In a poignant luncheon address, Hong Kong’s democratic leader Martin Lee warned that “Hong Kong is beginning to lose its freedoms,” political, economic, and religious. Lee, chairman of the Democratic Party in Hong Kong, described the awarding of the Cyberport contract to Li Ka‐​shing’s business interests without competitive bidding as “cronyism” and saw the refusal by China of the Pope’s proposed visit to Hong Kong as the first step in the curb of religious freedom. Lee said that the rule of law in Hong Kong “is going downhill and that the Chinese crackdown on the Falun Gong will spread to other groups in China, including the practice of Tai Chi.” (Excerpts from Lee’s remarks are on the September edition of CatoAudio.)

James R. Lilley, former U.S. ambassador to the People’s Republic of China, delivered the keynote address. Lilley contended that one key to improving relations with China would be American support of China’s accession to the World Trade Organization this year. “That would be a testament to the fact that we have recovered a sensible and pragmatic approach to China,” Lilley said, adding that it would be a signal to the Chinese that Washington was serious.

The first panel discussion covered the many domestic, economic, social, and political changes that have occurred in China since 1949. Kate Xiao Zhou of the University of Hawaii at Manoa argued that China has gone through a “spontaneous” civil rights movement in which the people have “followed no leaders and formulated no explicit credo or doctrine.” William McGurn of the Wall Street Journal said that China has opened, not because its leaders want it to, but because modernization is necessary for the country to survive.

The second panel dealt with such issues as the PRC’s claims to the South China Sea islands, relations with Japan and Taiwan, and relations with the United States. Ted Galen Carpenter, vice president for defense and foreign policy studies at Cato, noted that “Washington’s policy toward [China] is increasingly notable for its lack of consistency and clarity. A struggle is now under way between those who want to perpetuate the cooperative U.S.-PRC relationship of the 1970s and 1980s and those who see China as a repressive dictatorship and an emerging adversary of the United States and therefore favor a more hard‐​line approach in dealing with it.” Selig Harrison, a senior scholar at the Woodrow Wilson International Center, contended that “China’s conventional force posture and nuclear weapons deployments are defensive in character and are likely to remain so in the absence of grave provocation.”

Panel three focused on the political and economic reforms that are still needed if China is to become a prosperous democratic country in the first decades of the 21st century. Minxin Pei, senior associate at the Carnegie Endowment for International Peace, argued that while the Chinese Communist Party is celebrating 50 years of socialist control, it must thank market reforms for its continued survival. “Pro‐​market reforms have seriously eroded the broad social base of the CCP. This change has come about, ironically, precisely because of the relative success of the economic reform under Deng Xiaoping,” Pei said. University of Pittsburgh professor Thomas Rawski argued that China isn’t a market economy yet and that the lack of market mechanisms for investment means that China will have trouble rekindling high‐​speed growth without major policy shifts. Hong Kong University professor David Li said that reformers in China at times are obsessed with short‐​term issues when they should be pushing for long‐​term reforms.

Trade, security, and human rights were the themes of panel four. The key issues were WTO membership for the PRC, whether the trade deficit should be a matter of concern, whether trade should be linked to improvements in Beijing’s human rights record, and whether tighter export controls are needed for national security reasons. Jim Dorn, vice president for academic affairs at Cato, argued that China needs a “constitution of liberty” to provide citizens protection from the government. Robert Manning of the Council on Foreign Relations argued that we must recognize China as an “ambiguous situation,” not as the evil replacement of the USSR or as an ally. University of California at San Diego professor Barry Naughton contended that the economy has globalized to the point that Americans shouldn’t worry about trade deficits with China or any other country.

The papers presented at “Whither China? The PRC at 50” will be published as a book early next year. In addition, the conference, broadcast live on the World Wide Web, can be viewed online or downloaded for viewing later.

This article originally appeared in the November/​December 1999 edition of Cato Policy Report.