Three international credit-rating agencies have recently issued "amber" warnings. Once such warnings turn from amber to red, Hongkongers will pay a dear price for missing the opportunity to rejuvenate the economy.

Standard & Poor's, Moody's and Fitch are all renowned credit-rating agencies whose rating decisions are based on facts and devoid of any prejudice.

It is undeniable that political disputes have persisted; and it is a reasonable prediction that the "pro-democracy" camp may prevail in the upcoming September LegCo election and proceed to obstruct the government's effort to eliminate the budget deficit.

For this very reason, neither Financial Secretary Henry Tang's complaint nor Democratic Party leader Yeung Sum's defence is able to influence the agencies' judgments.

Frankly speaking, the controversy surrounding universal suffrage is the main reason for the negative rating. This fact has indirectly brought out two points: First, acute political wranglings have caused worries among international investors which, if not allayed in time, would bring about appalling consequences to the business environment.

Second, it was a wise move on the part of the Standing Committee of the National People's Congress (NPCSC) to act resolutely to stop the political disputes and clarify the situation through its interpretation of the electoral provisions of the Basic Law and its decision on the chief executive's report. The NPCSC's action was in line with Hong Kong's overall and long-term interests.

The agencies' warnings have once again attested to the well-known truth that there is no prosperity without stability.

Economy is the foundation of society, and its stagnation hampers the robust development of politics.

That is why Deng Xiaoping said that economics was the biggest politics.

If constitutional development hinders the revival of the local economy, the faster the process of democratization, the emptier Hongkongers' purses will be. Such a development is not the original intention of constitutional development.

When meeting with unionists from Hong Kong, Vice-President Zeng Qinghong tried to enlighten Hong Kong people with a lesson drawn from the cultural revolution which led to an economic depression. Unfortunately, Zeng's good intention was distorted by some Hong Kong legislators as a "threat" and "censure".

It is true that imperfections in the governance of the Tung administration have led to general discontent. Fortunately, Tung Chee-hwa and the SAR government are now well aware of this problem and are sparing no effort to make improvements in order to regain popularity.

Since last year, the Hong Kong government has quickened the pace of economic co-operation with Guangdong Province, and has been lobbying the central government into giving more support to the SAR. It has also put forward a number of measures to narrow the fiscal deficit and improve the job market.

All these efforts have finally resulted in a strong rebound of the local economy.

Not long ago, the NPCSC made a decision on Hong Kong's constitutional development, allowing the election methods in 2007 and 2008 to be amended. It can be said that Hong Kong's political situation has entered a new stage of development.

(China Daily HK Edition May 11, 2004)