Beijing OKs Economic Steps in Hong Kong, Nixes Democracy

BEIJING took a split stance on Hong Kong yesterday, vowing to dismantle newly approved democratic reforms when the colony reverts to Chinese rule in 1997 but signaling business-as-usual on key economic issues.

Although Hong Kong appears headed toward a stormy political future, Britain and China yesterday took the first step toward easing their standoff on economic matters by agreeing after seven years of negotiations to transfer military bases.

The pact and China's warning that it will scrap the colony's elected government bodies on July 1, 1997, came just hours after the Hong Kong legislature approved British Governor Chris Patten's plan to widen democracy in the territory.

The 32-24 vote early yesterday followed a marathon debate between democracy advocates who worry that China will undermine capitalism and their way of life, and pro-China legislators who fear that continued political confrontation will hurt the colony's economic stability.

The Patten plan provides for electing a 1995 legislature of 20 elected members, 30 representatives chosen by business, professional, and labor interests, and 10 appointed by a committee of elected municipal officials. Other uncontroversial issues such as lowering the voting age from 21 to 18 were approved by colony legislators in February.

``The Chinese side is still willing to cooperate with the British side,'' said Shen Guofang, a Foreign Ministry spokesman in Beijing. ``But the [political] differences over Hong Kong are bound to affect cooperation between the two countries on other issues. This is not what we wish to see,'' he said.

China's measured response contrasts sharply with the bitter recriminations and accusations directed at Britain and its Hong Kong government since Governor Patten unveiled his political reforms in October, 1992.

Fearing that democracy in Hong Kong could fuel political unrest on the mainland, Beijing wanted to limit the vote for the 30 specialized seats and exclude more than 2 million workers now included by the Patten plan.

China also objected to electing municipal councilors to the appointment committee. At present, 18 legislators are chosen by direct election, 21 are appointed by the government, and 21 represent the business, professional, and labor groups.

Staking his tenure as governor on passage of his political reforms, Patten predicts that China won't carry out its threat and dismember Hong Kong's elected government.

Although the British governor earned an international reputation as a populist and democracy crusader, many Hong Kong residents wearied of the political feud that was seen as endangering the colony's economic future.

Before the final legislative action, the Patten package narrowly escaped watering down from a challenge launched by a pro-China party of businessmen. Their amendment was narrowly defeated by a 29-28 vote.

``How can these reforms be relevant if China is just going to turn around in 1997 and overturn the entire system?'' asks an Asian diplomat in Beijing. ``Now, China wants to marginalize Patten as much as possible and get on with the business of a smooth transition on the economic front.''

BUT Patten also will have to respond to a core of democracy advocates who want him to go even further. They are urging the legislature to establish a human rights commission and pass antidiscrimination and freedom of information bills.

In the interest of winning Chinese accord on economic issues, the democratic reformers worry that the British administration will back away from further political change. ``Mr. Patten should not sacrifice human rights protection in order not to offend China,'' says Christine Loh, a legislator and outspoken advocate of broader democratic reform.

Britain, which wants to secure a stable niche for its businessmen in the booming Chinese market, is also anxious to finalize an agreement on financing the proposed $20.3 billion airport, which could be announced this week. Also pending are plans for a ninth container terminal at Hong Kong's crowded port and an agreement on how to handle Hong Kong's international treaty obligations.

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