On July 1, 1997, Hong Kong returned to the embrace of the motherland after 150 years of British colonial rule. Since then, it has entered a new historical period featuring "one country, two systems" and Hong Kong governed by the Hong Kong people with a high degree of autonomy.

Fifth anniversary of Hong Kong's return

On July 1, 2002, then President Jiang Zemin attended the fifth anniversary of Hong Kong's return to the motherland and the inauguration of the second-term government of the Hong Kong Special Administrative Region (SAR). In his speech, Jiang said that over the past five years, the scientific conception of "one country, two systems" had become a reality. The SAR government headed by Mr. Tung Chee-hwa had made strenuous efforts to unite all walks of life in Hong Kong to surmount various difficulties. He pointed out that shortly after its return, Hong Kong encountered the severe impact of the Asian financial crisis, which resulted in unfavorable changes in the international economy. Backed by the Central Government, the SAR government, remaining calm and joining hands with all walks of life in Hong Kong, properly handled a series of social and economic problems and consequently maintained stability of the general situation.

The principles of "one country, two systems" and Hong Kong governed by the Hong Kong people with a high degree of autonomy have been fully implemented. The capitalist system remains unchanged and the local residents continue their lives in their accustomed ways. Hong Kong still maintains the characteristics of a free port and its status as a center of international trade, finance and shipping. It is still regarded as one of the most dynamic regions in Asia and even the whole world.

It has been fully displayed that the principle of "one country, two systems" is workable, Mr. Tung Chee-hwa and the SAR government under his leadership have the wisdom and capability to handle a complicated situation, and the Hong Kong people are capable of governing Hong Kong well, Jiang said.

Successful practice of "one country, two systems" plays an exemplary role for the Taiwan issue

For the fifth anniversary of Hong Kong's return to the motherland, Jiang Enzhu, Director of the Liaison Office of the Central People's Government to Hong Kong SAR, published an article stating that the successful practice of the principle of "one country, two systems" in Hong Kong is playing an exemplary role for the final settlement of the Taiwan issue.

In the five years, more than 10 million Taiwan compatriots visited Hong Kong or stopped at Hong Kong to visit the mainland. Through what they saw and heard, more and more Taiwan compatriots have gained a better understanding of the principle of "one country, two systems," and that this might also be a good solution to the Taiwan issue. With Hong Kong continuing to be prosperous and stable on the basis of "one country, two systems,¡± Taiwan compatriots would see that the principles of "peaceful reunification" and "one country, two systems" are a feasible solution to settle the Taiwan issue.

Hong Kong in the big family of the motherland is receiving more attention from the international community. Authorized by the Central Government, Hong Kong SAR has signed 63 bilateral agreements with other countries and regions. By May 31, 2002, altogether 112 countries and regions had waived the need for visas to Hong Kong SAR passport holders, which fully demonstrates the cognizance of the "one country, two systems" practice in Hong Kong by the international community.

The number of emigrants notably decreases

According to statistics of the Census and Statistics Department of the Hong Kong SAR Government, prior to 1997, an average of 50,000 Hong Kong people emigrated annually. But this figure fell to 10,500 in 2001, a drop of 11 percent compared with the figure in 2000. In addition, more than 110,000 emigrants have come back to Hong Kong so far. Some said they had emigrated originally because they had no confidence in Hong Kong's return to China, yet they found Hong Kong has better political environment than expected after the return. Some people rushed to change their passports as British or other nationals before the return, but now such a scene is nowhere to be seen. Of its population of 6.8 million, 2.3 million have applied for the SAR passport.

Instead of migration, it has become a new trend for Hong Kong residents to go northward for work and investment. A survey of the SAR Government Planning Department shows some 41,000 Hong Kong residents have settled in the mainland, while about 25,000 Hong Kong residents plan to settle there in the next 10 years.

A base for doing business

So far more than 3,200 foreign companies have set up regional headquarters or offices in Hong Kong.

Thanks to the economic restructuring in recent years, the rents of both office and residential buildings have fallen to an acceptable level, while wage readjustment has also greatly improved the environment for business operations. The Investment Promotion Service summed up five major reasons for the SAR's appeal to foreign investment: The simple and low-rate tax system, freedom of information, political stability and good public security, honest government, and fine communications, transportation and other infrastructure.

All facts show that Hong Kong's status as an international metropolis has not faded with the return. The Hang Seng Index has surpassed the Nikkei Average, ranking first in Asia, while the container handling capacity of Hong Kong has led the world for years. Recently, Hong Kong was rated for the sixth successive year as the region with "the world's freest economic system," which once again confirmed its international status.

Mainland residents do business in Hong Kong

The number of mainland residents engaged in business activities in Hong Kong has doubled and redoubled over the years. Mainland residents with permits to go to Hong Kong and Macao numbered 650,000 in 2000, 1.09 million in 2001 and 2.27 million in 2002. Currently, more than 6,200 mainland residents visit Hong Kong on business daily.

Mainland tourists account for over 40 percent

Due to the loosening of controls on travel to Hong Kong, of the 16 million tourists recorded there in 2002, mainland tourists approximated 6.83 million, accounting for 41 percent. It is predicted that the number will increase 15 percent to reach 7.86 million in 2003.