Hong Kong's return to Chinese rule has ended its role as an open marketplace of ideas where China's Communists and Taiwan's democrats could compete to sell their alternative political visions.
Now, with Beijing in charge of the tiny capitalist enclave and clamping down on pro-Taiwan activities, Hong Kong is taking on a new role: Its leader, Tung Chee Hwa, has strong business ties in Taiwan and is seen as a potential peacemaker between the island and China.
Hong Kong has long stood at the crossroads of "Greater China," the loose economic grouping that includes Taiwan and the mainland, and has grown rich by facilitating trade between the former combatants of the Chinese civil war.
Besides being a major player in the pan-Chinese economy, "Tung Chee-hwa has broad political ties with both Taiwan and China, and could be the perfect link between the two sides," says Ma Ying-jeou, a former justice minister in Taiwan.
"Tung could help restart peace negotiations between Taipei and Beijing that were frozen in 1995," when Taiwan's drive to raise its diplomatic profile caused China to begin staging war games near the island, he adds.
Since its July 1 takeover of Hong Kong, China has adopted tactics of both confrontation and conciliation toward Taiwan.
"Beijing has allowed Taiwan's mission here to remain open, but it has also issued ultimatums to nations that recognize Taipei to close their consulates in Hong Kong," says Allen Pun, a Taiwan diplomat here.
And while Mr. Tung outlined a post-handover ban on protests promoting Taiwan's independence, one of his first acts as Hong Kong's chief executive was a meeting with Taiwan's top cross-strait peace negotiator.
Taipei has an enormous economic stake in preserving its trade and political ties with Hong Kong, which in recent years has edged out the US as Taiwan's top export market.
Taiwan's almost 50-year ban ban on direct contacts with the mainland has made Hong Kong the main conduit for investment in China, and the three regions' economies are becoming increasingly interdependent.
"The [Communist] Party hopes to see the economic union of China, Hong Kong, and Taiwan evolve into a political grouping," says a Chinese intellectual with high-level government contacts. "Tung Chee-hwa could become a major power broker if he helps make that happen."
Tung's father was a close friend of Nationalist leader Chiang Kai Shek, and Tung himself is strengthening his ties with Beijing's Communist leaders.
"Tung Chee Hwa has a deep background in Chinese culture and Confucian ideals," says Tu Weiming, a China scholar at Harvard University.
"Tung's emphasis on harmony and consensus," rather than ideology, could help him bridge the political barriers that divide China's authoritarian leaders and democrats in Taiwan, says Professor Tu.
Contacts based on a common civilization are spreading across Greater China, but nationalism on the mainland and in Taiwan is fanning the flames of the cross-strait conflict.
Scholars, officials, and citizens on both sides of the strait say that the potential futures in China-Taiwan relations range from a reignition of the 1949 civil war to a political reconciliation.
Wang Jianxian, a leader of the pro-reunification New Party in Taiwan, says the island's moves toward nationhood could spark a second cross-China war, and devastate Taiwan in the process.
"If Taiwan declares independence, mainland China does not need to invade Taiwan to destroy it," he says. "China could target its missiles at Taiwan's petroleum centers, its industrial centers, and other strategic sectors."
"The Chinese Army could bomb Taiwan back into a primitive economy without ever stepping foot on the island," he says.
On the other hand, he adds, building on the two sides' cultural and economic links could see the rise of a Chinese common market and, eventually, a confederation with postcommunist China.
He and other politicians in Taiwan say Tung is trusted on both sides of the strait, and could become the impartial mediator Taiwan and China need to end their decades-old cold war.
WITHIN China, nationalists in the Chinese Army are debating with more moderate leaders about whether to use force to crush Taiwan's independence movement or use persuasion toward peaceful reunion, says the Chinese intellectual.
Chinese President "Jiang Zemin and other party leaders selected Tung to head Hong Kong largely due to his strong connections with Taiwan," he says.
"If the party decides to take the path of peace with Taiwan, then Tung is the most likely candidate to head that mission," he adds.