China Tightens More Screws On a Panicky Hong Kong

AS the 500 supporters of Hong Kong's elected legislature paraded past his camera shop yesterday, Louis Wong watched briefly and then shook his head.

"They say they want democracy. They will only get themselves in trouble," he said.

"The majority of the people are fearful because they feel they can't change anything, anyhow," says protester Au Loong-yu. "We could be thrown into jail [after 1997]. But in the long run, I'm optimistic because [Beijing] can't resist democracy forever."

Pro-democracy demonstrations through Hong Kong capped a week that has rattled the British colony's confidence in preserving its free-wheeling way of life after China takes over in July 1997.

Twelve years ago, Britain agreed to turn back to China the colony it has controlled for more than a century. In exchange, China had guaranteed to grant Hong Kong a large measure of political and capitalistic autonomy for 50 years after the turnover.

This past week, though, China announced measures that have raised doubts as to whether Beijing's ruling Communists will stand by their word. Beijing has been on edge about the colony's future ever since British Governor Chris Patten pushed through some democratic reform.

Confirming its oft- repeated threat, China said it will dissolve the colony's first-elected Legislature Council (known here as Legco) and replace it with a "provisional" one, comprised of existing pro-mainland legislators and business community loyalists.

One appointee to the Beijing-appointed, 150-member Hong Kong Preparatory Committee, Frederick Fung, opposed the plan and was barred from future participation.

"We don't want to see the Chinese government dismantle Legco because it would be just like a coup d'etat in a banana republic," says Emily Lau, an outspoken legislator and a demonstration organizer.

Beijing has denied the elected Hong Kong Legco any say in approving the last British government budget, raising fears of fiscal disruption. The Democratic Party, the largest and most popular in Legco, was banned from taking any seats in the post-July, 1997 Chinese-appointed parliament.

And in what some analysts see as a major blow to a smooth transition, Beijing said civil servants in Hong Kong must back Chinese plans to abolish the elected Legco by taking a "loyalty oath." Until now, China has gone to great lengths to keep the colony's influential civil-service structure intact and ensure a smooth transition. This drew widespread outcry from senior government officials in the colony because it implies civil servants would have to resign if they refused to go along. Among them was Secretary Anson Chan, who has proposed meeting with Beijing on the matter and is a contender to become the first chief executive after the 1997 transfer.

China tried to temper its comments by denying that civil servants would face resignation if they refused to pledge loyalty. But observers say the colony's atmosphere has already been damaged. "Right now, China has a strategy to put into place a shadow government," says Christine Loh, a legislator leading yesterday's demonstration. "This is a test of political correctness."

"This is not good for confidence in the colony," said an investment banker who explained China could trigger capital flight and an exodus of professionals. "No one thought China would risk undermining the economic future of Hong Kong."

The mood turned panicky last week as thousands of colony residents rushed to beat a deadline to register as British Dependent Territories Citizens. Before the registration period expired at midnight Saturday, more than 20,000 people waited in a line that snaked through parts of central Hong Kong.

More than 120,000 people have registered this month for the status, which if approved, would allow them to apply for a British National Overseas passport, although not the right to live in Britain. The passport would give visa-free access to 80 countries. The number of registrants was one-third higher than expected.

Analysts say that China still wants a problem-free transition, but the atmosphere has soured in recent months. Relations with Britain have declined so much that the two sides may even be unable to agree on holding a joint ceremony for the transfer, Hugh Davies, Britain's chief negotiator said.

Analysts also say that China is increasingly jumpy about the turnover in the wake of its recent tensions with Taiwan. After its threatening military war games failed to influence the outcome of Taiwan's first-ever democratic presidential elections, Ms. Lau says Beijing is "in a disarray."

"Maybe the Taiwan election has made them more fearful," says Ms. Loh. "The Taiwan experience is an inspiration to us as well as Taiwan."