In 1997, we knew the big news in advance
By Muhammad Cohen
HONG KONG - It didn't get much better for news reporters and producers than
Hong Kong at the start of 1997. We already knew what would be the biggest story
of the year.
Whether you called it the return of Hong Kong to the loving embrace of the big
motherland or the craven surrender of free people to "Communist" China, it was
a once-in-a-lifetime news event where media had advance word on the players,
time and place for coverage.
Deng Xiaoping's death in February gave the story a dimension of irony
previously missing. Deng was the architect of the "one
county, two systems" formula for Hong Kong's reunification that he wouldn't
live to see. He was better known, then and now, as the driving force behind
"socialism with Chinese characteristics" that turned the mainland into a global
economic powerhouse.
It's worth remembering - and hard to forget for those of us in Hong Kong - that
mainland China was not the world's most dynamic economy in 1997. It wasn't even
considered the most important economy in Greater China.
Deng's famous 1991 visit to Guangdong province reignited the spirit of reform
that had languished in the wake of the 1989 Tiananmen Square crackdown. While
introducing welcome market elements to China's state-dominated economy, reform
also unleashed all manner of scams aimed at enriching Communist Party members
and their cronies at the expense of state coffers and private investors. The
end of Iron Rice Bowl (cradle-to-grave security provided by the state)
threatened massive social turmoil, with cutbacks in state industries putting
millions out of work and threatening tens of millions of additional unemployed.
President Jiang Zemin was no expert in economics. ("Only Zhu Rongji understands
economics," Deng said, and Zhu didn't replace Li Peng as premier until March
1998.) In 1997, China's worst case was a fitting sequel to the Great Leap
Forward and Cultural Revolution: 100 million angry, desperate jobless with no
social safety net to catch them. Tiananmen Square would look like a picnic.
The best case cast China as Alice in Through the Looking Glass, forced
to run as fast as it could to stay in the same place. And in 1997, the notion
that China could sustain double-digit growth despite its bankrupt political
structure and unsound financial system seemed truly the stuff of Wonderland.
There was an Asian century coming, but it would belong to Southeast Asia's
tigers plus the industrialized, revitalized emerging democracies South Korea
and Taiwan. Perched at the crossroads of this Asia, Hong Kong would ride these
tigers to its new burst of post-colonial, 21st-century prosperity.
As the handover approached, Hong Kong was not just at the center of Asia, but
at the center of the universe, a global melting pot bubbling with pure gold.
Legions of freshly minted overseas investment bankers sported housing and
travel allowances bigger than their classmates' salaries on Wall Street (where
the dot-com bubble was still just a pimple).
China was the big story about to ripen - but China had been "about to ripen"
for foreign businesses for more than century by then. While waiting for this
China business to fatten on the vine, there were banking deals to be done in
Manila, Seoul, Bangkok and Jakarta.
These bankers and their bosses back home were the people we wrote the news for
in Hong Kong during those heady pre-handover days. When July 1 came, we
lavished the event with every bit of reverence and weight lent by Britain,
China and the thousands of reporters parachuted in. But in the end, we
journalists knew it was more sound and fury than substance.
Like fireworks that celebrated it, the handover streaked across the sky and
made spectacular viewing, but within minutes it was over and the sky was
unchanged. For journalists, that's the easiest news story to cover, even if it
leaves you hungry for more an hour later.
While we were sleeping off the handover celebrations, Thailand devalued the
baht, triggering a financial earthquake across Asia. Decades of economic
progress seemed to dissolve in weeks. Urban sophisticates whose fathers drove
oxen saw the Mercedes they'd been driving repossessed. Middle classes had their
jobs and their status splattered in the currency and stock-market carnage.
The crisis quickly reached Hong Kong as deals dried up and bankers fled, taking
with them demand for premium-priced housing. That was enough to burst the
property bubble, dragging down the stock market pumped to record levels by
tycoons eager to show their confidence in Beijing's rule. With demand from
overseas also contracting, Hong Kong's economy fell into recession.
As the crisis grew, news media in Asia had a real, unanticipated story even
bigger than the handover. But it wasn't a story anyone wanted to hear,
especially overseas viewers, networks and their sponsors paying the bills. As
market liquidity shriveled, so did demand for news from Asia. An even bigger
story was just ahead, as China, insulated from the regional crisis by currency
controls and unsophisticated financial institutions, replaced the wounded
tigers as the factory floor to the world.
Of course, by then the world's attention had turned far away from Hong Kong.
The real biggest story of 1997 broke on August 27 in a Paris tunnel, the death
of Diana, Princess of Wales. That year, with its biggest story already written,
became the summer of unexpected bad news.
Former broadcast news producer Muhammad Cohen is special correspondent
for Macau Business and author of Hong Kong on Air (Blacksmith Books), a
novel set during the 1997 handover and Asian economic meltdown featuring
television news, love, betrayal, high finance and cheap lingerie.
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