Gift to a Former Mentor: Hong Kong's Contribution to the Rise of China and the Consequences of That Rise for the Current Relationship

Abstract

Hong Kong made a crucial contribution to China's rise, but in the last fifteen years the balance of influence has shifted. Quantitative dominance in foreign investment since reforms began in 1979 was, and apparently still is, a key part of Hong Kong's contribution to China's rise. The qualitative significance of Hong Kong's role in integrating China with the global capitalist economy through providing market knowledge and contacts was even more critical. The central importance of Hong Kong investment in the 1980s was that it provided not what China wanted (higher technology and modernization of state enterprise} but what it needed (a way to take advantage of China's vast stocks of unproductively utilized labour). However, our focus is not on Hong Kong's contribution to China's rise. Instead, we concentrate on the implications of that rise for Hong Kong.