HONG KONG: THE BIG HANDOVER

FOR THE FIRST TIME BRITAIN IS GIVING A COLONY TO A COMMUNIST STATE. THE PEOPLE OF HONG KONG ARE BOTH PROUD AND ANXIOUS

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No one has quite done this before. Oh, yes, the British are long practiced in the solemn rites of lowering the imperial flag. For the 68th time this century, the Union Jack will slide permanently down a colonial flagpole, amid skirling Black Watch bagpipes, phalanxes of Gurkha soldiers and the measured paces of the Prince of Wales. But for all its high-toned honorability, the midnight ceremony on June 30 handing Hong Kong over to the People's Republic of China leaves the West feeling guilty, ignoble and very anxious. In those 67 prior cases, the world's greatest modern empire was setting free its territories to be democratic, at least in theory. What the West cannot quite stomach this time is that the stunningly prosperous enclave of Hong Kong, home to more than 6 million Chinese, most of whom fled or whose parents fled the mainland since the 1940s red revolution, is being given into communist hands. This is the era of democracy; we are supposed to have won the ideological war. So how come Hong Kong is being voluntarily handed back to the devil?

Look at it, for just a minute, the other way round. China recently published an "Atlas of Shame" cataloging its abasements at the hands of colonial powers over the past 155 years. First on the list: Britain, abetted by American merchants in 1840, turned its battleships and guns on Canton in order to ram opium down Chinese throats and open China to foreign exploitation. The humiliating siege ended when the Emperor capitulated and ceded Hong Kong Island to Britain.

At one minute after midnight on July 1, as the red-and-yellow flag of the People's Republic rises in the glare of artificial rockets, a proud nation will wipe away the stain of shame. President Jiang Zemin himself will preside as the motherland reclaims a piece of itself, instantly replacing the councils and crown symbols of British rule with the new authority of the Hong Kong Special Administrative Region. The Chinese feel that a historic wrong has been righted. It showed in the faces of the elderly pensioners who gathered a few weeks ago in the mainland city of Shenyang for their own humble handover ceremony. The Old People's Singing Group of Xinghur Park caroled their joy at Hong Kong's return: "100 years is a long time/But now Hong Kong is coming home."

If only it were that simple. The people of Hong Kong embrace neither of these extremes. They share pride in the reunification of China, and they harbor some misgivings about their new landlords, but they're ready to give their new system a chance. The awkward title of Special Administrative Region, HKSAR as it will be known, signals just how hard it will be to implement Deng Xiaoping's promise of "one country, two systems" with a "high degree of autonomy." At issue for Chinese on both sides of the new internal border is not only whether Hong Kong's system of advanced capitalism under the rule of law can be grafted onto the stunted system of Chinese socialism, but how, over the long term, the motherland and the former colony cope with the new realities. For the rest of the world, only beginning to come to terms with the prospect of China as a 21st century superpower, Beijing's management of Hong Kong will serve as the litmus test of its ability to operate within the constraints of the community of modern industrialized nations.

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