There is an urgent need for a vision for Hong Kong in the coming years and decades for the central government, the SAR government and people in Hong Kong. Vision is different from development strategy or economic positioning. It should embrace the many facets and milieus of the society and it should tell the future, both idealistically and realistically (that is achievable albeit with great efforts).

At present, 16 years after the sovereignty handover, there have only been vague ideas about the nature of society of Hong Kong, and the basic principles of the Basic Law has been based on these vague and contestable principles. No wonder after so many years we have not seen any development strategy in Hong Kong emerging from the sovereignty change and the change of administration in the SAR government. Every policy is either a continuation of the colonial regime or piecemeal alterations that are not contextualized in broader perspectives and serve little purpose except administrative convenience and political expediency. This is a political and policy environment that breeds government incompetence and gradual taking over by oligopolistic vested interests both locally and overseas.

A vision of Hong Kong that may guide the society and people forward needs to clarify some fundamental concepts that are cornerstones of the Basic Law.

The first is capitalism. What is capitalism and what capitalism is more appropriate for and beneficial to the social progress of the local society in Hong Kong? In history, there have been mercantilist capitalism that was built upon and created colonialism, industrial capitalism that entails mass commoditization of labour, and financial capitalism of neo-liberalism founded on political, social and economic polarization and exclusive growth amidst frequent crises for the masses.

As capitalism has always been an institutionalization of the market economy and its consequences, institutions are always spatially bound and historically embedded. It is therefore plausible to talk of Anglo-Saxon capitalism based on common laws versus the German and Japanese capitalism based on continental laws with many countries' capitalism falling between the two major tendencies. What variety of capitalism should the post-colonial Hong Kong adopt? The Singapore model? The Taiwan model? Or a non-existent free-market model? At least a reasonable understanding of the history of capitalism should know that 21st century Hong Kong could neither return to the Victorian capitalism in England, nor the robber lord era of American capitalism.

Hong Kong has inherited a partial welfare system from the British. This should be a base to start thinking about what kind and what degree of welfare capitalism should be pursued in the city. Sixteen years after the handover it is clear to the local population that Hong Kong needs to have more welfare rather than more reserves storing in financial houses overseas for the aging society.

There should be a discussion and debate about the variety of capitalism that Hong Kong should adopt in order to decide on major policy issues, such as the role of government in society affairs and governance, economic development strategies, social welfare and etc.

Democracy and liberty are not vague concepts. They are concrete ones that are embodied in these policy issues. Universal suffrage is only one element of democracy and relates mainly to the method of representative election rather than real decision-making in major milieus of society. Deep-rooted and sustainable democracy is a culture embedded in institutions and history of the society and penetrates every area of human activities. Political democracy in the form of popular election could not be materialized if there is no democracy among and within parties and groups, and in schools, firms, community organizations, as well as in families. Democracy also means organization to practice collective decision-making and compromises, and requires enforcement of law and its organizational arms, police, courts and government.

The discussion and debate on the variety of capitalism to be adopted for Hong Kong will inevitably involve democracy. Discussion and debate are parts of the democratization process, and the capitalism to be chosen has also to be founded upon the consensus and compromises on major policy issues, but not exclusively. They will definitely touch upon the current structure of vested interests and practicing modes of distribution and redistribution, the foundation for democratic institution and socio-economic-political liberty.

As a world city of Asia, Hong Kong is in competition with other global cities. And in the 21st century the contest for economic superiority depends on the sophistication of the knowledge society. If Hong Kong is to become a sophisticated knowledge society it needs to understand itself properly and have its policy regime transparent. The first step is to know what kind of capitalism Hong Kong has been practicing and on this basis what variety should be pursued for the betterment of the majority of the local population as well as for the nation at large in a sustainable way.

The author is head of the China Business Center at Hong Kong Polytechnic University.

(HK Edition 07/18/2013 page1)