The second system: Institutional compromise or compromised institutions in the Hong Kong special administrative region

Making the concept of ‘one country, two systems’ operational in Hong Kong has been a significant challenge for China. The institutions of government put in place for the Hong Kong Special Administrative Region (HKSAR) had to satisfy a delicate balance between the Communist Party's need to ensure that the HKSAR poses no threat to its continued pre‐eminence in China and providing an environment whereby Hong Kong's economy would continue to prosper. The arrangements settled upon represent a compromise which gives the Party much less control than it is accustomed to exercise, yet is far from being democratic. One key element had been the ability to recruit a Hong Kong leadership which sees it as in its interest to work within the institutional compromise. The forces which shaped that compromise are outlined and the record of the HKSAR examined.