April 16, 1987

I am here to meet with you today for just one purpose. It has been nearly two years since we last met, and I should like to thank you for all your hard work.

The committee has been working for a year and eight months. Thanks to your perseverance and intelligence, your work has been making good progress, and you have been cooperating with each other very well. This will facilitate a smooth transition for Hong Kong. The success of our "one country, two systems" formula should be guaranteed by the basic law of the Hong Kong Special Administrative Region. This law will serve as a model for Macao and Taiwan. It is therefore very important. It is something new, without precedent in world history. You still have three years in which to draft the best possible document.

Today I should like to talk about some things that will not change. Our policy on Hong Kong will not change for 50 years after it is reunited with the motherland in 1997. That policy, along with the basic law you are now drafting, will remain in force for at least 50 years. And I want to add that there will be even less need to change them after the 50-year period. Hong Kong's status will not change, nor will our policy towards Hong Kong or Macao. After Taiwan is reunified with the mainland under the "one country, two systems" formula, our policy towards Taiwan will also remain unchanged for 50 years. There will be no change either in our policy of opening up at home and opening to the outside world.

By the end of this century China's per capita GNP will reach between US $800 and $1,000 -- we have hopes that it will be $1,000. I am afraid that China will still rank below 50th place among the more than 100 countries in the world, but there will be a difference in its strength. Our population will have reached 1.2 to 1.25 billion, and total GNP will be between $1 trillion and $1.2 trillion. Since our socialist system is based on public ownership, and since our goal is to achieve common prosperity, we shall then have a society in which the people lead a fairly comfortable life -- that is, everyone's standard of living will have been raised. More important, if with this as a foundation we can continue to develop, in another 50 years we shall again quadruple our per capita GNP to $4,000. This will put China among the moderately developed countries, though its place will still be lower than that of dozens of others. At that time, with a population of 1.5 billion producing a GNP of $6 trillion (calculated in accordance with the 1980 exchange rate of the renminbi yuan against the US dollar), China will surely be in the front ranks of the countries of the world. And thanks to our socialist system of distribution, not only will there be a change in China's national strength, but the people's standard of living will be higher.

What conditions are necessary for us to achieve this goal? First, China needs political stability. Why did we take the student unrest so seriously and deal with it so quickly? Because China could not afford any more disorder or unrest. We must put the overall national interests above all else. The key to China's development is political stability. The second condition is that the current policy must remain unchanged. As I have just said, the importance of that can be seen from the goals we have set for the next few decades. For example, right now people are talking about the problem of privately hired labour. I have said to many comrades that it is not worth showing that we are taking action on this question and that we can wait a couple of years. At first I said we could wait two years; now two years have passed, and I'd say we should still wait. In general, it is only small enterprises and peasant households working under the contracted responsibility system that are hiring outside help. Compared with the more than one hundred million workers and administrative personnel in public enterprises and institutions throughout the country, the number of privately hired workers is very small. In terms of the overall situation, there are only very few of them. It would be easy to take action against the practice of hiring labour, but if we did that, people might think we were changing our policy again. Of course, we must take action, because we do not want polarization. But we have to consider carefully when and how to do it. By taking action I mean attaching some restrictions to the practice. In dealing with matters like this, we should bear in mind that we must not unthinkingly cause uncertainty or confusion. That is what I mean by taking the overall situation into consideration. It is important for us to encourage people to use their heads and find ways to develop our economy in a pioneering spirit. We should not dampen their initiative; that would not be good for us.

So, both the political situation and the policy should remain stable. Making no change means stability. If the policy is successful, yielding the desired results in the 50-year period after 1997, we shall have little reason to change it then. That is why I say that after the motherland is reunified under the "one country, two systems" formula, our policy towards Hong Kong, Macao and Taiwan will not change for 50 years and that it will remain unchanged even beyond that period. Of course, I won't be around at the time, but I am convinced that our successors will understand this reasoning.

There is something else that will not change. People are happy that the Communist Party and the government of China mean to keep the policy of opening to the outside world unchanged. But whenever they hear the leaves rustling in the wind -- as now, when we are opposing bourgeois liberalization -- they wonder if the policy is changing. They overlook the fact that there are two basic aspects to China's policy. When we say there will be no change, we refer to both aspects, not just one. The aspect that people overlook is adherence to the Four Cardinal Principles, which include upholding the socialist system and leadership by the Communist Party. They suspect that China's open policy is changing, but they never ask about the socialist system. That system will not change either!

We decided long ago to uphold the socialist system and the Four Cardinal Principles, and that decision has been written into the Constitution. It was also on the understanding that the main body of the country would adhere to the Four Cardinal Principles that we formulated our policy towards Hong Kong, Macao and Taiwan. If it were not for the Communist Party and China's socialist system, who would have been able to formulate a policy like that? No individual or political party would have had the courage and farsightedness. Isn't that so? Nobody could have done it without courage and resourcefulness. But courage and resourcefulness must have a basis, which in this case consisted of the socialist system and socialist China under the leadership of the Communist Party. We are building socialism suited to Chinese conditions, which is why we were able to formulate the policy of "one country, two systems" and why we can allow the two different systems to coexist. We would not be able to do this if we lacked courage, the courage that comes from the support of the people. Our people support the socialist system and leadership by the Party.

Any view that neglects the Four Cardinal Principles is one-sided. When considering whether China's policy will change, one must also take into consideration whether this aspect will change. To be honest, if this aspect changed, it would be impossible to keep Hong Kong prosperous and stable. To keep Hong Kong prosperous and stable for 50 years and beyond, it is essential to maintain the socialist system under the leadership of the Communist Party. Our socialist system is a system with Chinese characteristics. One important characteristic is our way of handling the question of Hong Kong, Macao and Taiwan, or the "one country, two systems" policy. This is something new. It was created not by the United States, Japan, the Soviet Union or any European country, but by China; that is why we call it a Chinese characteristic. When we say the policy will not change, we mean the policy as a whole -- that no aspect of it will change. If any aspect changes, the others will be affected. I should therefore like to ask you to explain this principle to our friends in Hong Kong.

Try to imagine what would become of Hong Kong if China changed its socialist system, the socialist system with Chinese characteristics under the leadership of the Communist Party. That would be the end of prosperity and stability for Hong Kong. To make sure the policy remains unchanged for 50 years and beyond, we must keep the socialist system on the mainland unchanged. By combating bourgeois liberalization, we mean to ensure that our socialist system does not change and that the whole policy and the policy of opening up domestically and internationally do not change either. If they changed, we would have no hope of building a society in which our people lead a fairly comfortable life by the end of this century, or of reaching the level of the moderately developed countries by the middle of the next. At present, the entire world economy is under the control of international monopoly capital, and the world market is dominated by it. It would be difficult for any country to break out of this situation, and especially for a poor country like China. Without the policies of reform and opening to the outside, we would never be in a position to compete. You know this better than we do; it is exceedingly difficult. People have been talking a great deal about whether or not China's policy will change, and I think they will still be talking about it at the end of this century and into the next. We shall let facts speak for themselves.

Some people are saying that China is pulling back on its policies of reform and opening to the outside world. I must say that there are some problems with commodity prices and that we have slightly reduced our investment in capital construction. But we should look at this problem from an overall point of view. It is only natural that when taking a step forward we should contract some things and expand others. Overall, what we want is to open up domestically and internationally. Our open policy will certainly continue; the problem is that we have not yet opened wide enough. Carrying out reform and opening to the outside are difficult tasks, requiring great courage and resolution. But unless we persevere in them, we shall have no way out and no hope of modernizing the country. Still, in dealing with specific matters, we must be cautious and learn from our experience as we go along. After we have taken a step, we must review what we have done to find out what needs to be speeded up, what needs to be slowed down and what needs to be contracted. That is the way we have to proceed; we must not rush headlong into things. Whenever we introduce restrictions somewhere, there are people who think that we have changed our policy, but that is not true.

There are also two aspects to the policy of "one country, two systems". One is that the socialist country allows certain special regions to retain the capitalist system -- not for just a short period of time, but for decades or even a century. The other is that the main part of the country continues under the socialist system. Otherwise, how could we say there were "two systems"? It would only be "one system". People who advocate bourgeois liberalization hope that the mainland will become capitalist or "totally Westernized". Our thinking on this question should not be one-sided. If we don't attach equal importance to both aspects, it will be impossible to keep the policy of "one country, two systems" unchanged for several decades.

Mike Wallace, an American journalist, once asked me why Taiwan should want to be reunified with the mainland, since the economic level on the mainland was so much lower. My answer was that there were two main reasons. First, the reunification of the country has long been the aspiration of all the Chinese people, an aspiration they have shared for a century and several decades, nearly a century and a half. Ever since the Opium War, reunification has been the common desire not just of one political party or group but of the whole Chinese nation, including the people in Taiwan. Second, unless Taiwan is reunified with the mainland, its status as a part of China's territory would remain uncertain, and it might someday be seized by another country. Internationally, many people have been making an issue of Taiwan for their own purposes. Once Taiwan and the mainland are reunified, even if everything in Taiwan, including its current system, remains the same, its situation will be stable. Therefore, the people on both sides of the Taiwan Straits believe that the settlement of this question will be a great event, a great contribution to the country and the Chinese nation.

Now I should like to say something more about the drafting of the basic law. I have said the law should not be weighed down with too much detail. Furthermore, Hong Kong's system of government should not be completely Westernized; no Western system can be copied in toto. For a century and a half Hong Kong has been operating under a system different from those of Great Britain and the United States. I am afraid it would not be appropriate for its system to be a total copy of theirs with, for example, the separation of the three powers and a British or American parliamentary system. Nor would it be appropriate for people to judge whether Hong Kong's system is democratic on the basis of whether it has those features. I hope you will sit down together to study this question.

So far as democracy is concerned, on the mainland we have socialist democracy, which is different in concept from bourgeois democracy. Western democracy includes, among other features, the separation of the three powers and multiparty elections. We have no objection to the Western countries doing it that way, but we on the Chinese mainland do not have such elections, nor do we separate the three powers or have a bicameral legislature. We have a unicameral legislature, the National People's Congress, which best conforms to China's realities. As long as it keeps to the right policies and direction, such a legislative body helps greatly to make the country prosper and to avoid much wrangling. Of course, if the policies are wrong, any kind of legislative body is useless.

Would it be good for Hong Kong to hold general elections? I don't think so. For example, as I have said before, Hong Kong's affairs will naturally be administered by Hong Kong people, but will it do for the administrators to be elected by a general ballot? We say that Hong Kong's administrators should be people of Hong Kong who love the motherland and Hong Kong, but will a general election necessarily bring out people like that? Not long ago the Governor of Hong Kong, Sir David Wilson, said that things should be done gradually, a view that I think is realistic. Even if a general election were to be held, there would have to be a transition period -- it would have to be a gradual process. I once told one of our foreign guests that general elections could be held on China's mainland half a century from now, sometime in the next century. At present, indirect elections are held for posts above the county level, and direct elections are held for those at the county level and below. Because we have one billion people, and their educational level is not very high, conditions are not yet ripe for direct elections. The truth is, not everything that can be done in one country can be done in another. We must be realistic and determine our system and our methods of administration in light of our own specific conditions.

There is another point that I should make clear. Don't ever think that everything would be all right if Hong Kong's affairs were administered solely by Hong Kong people while the Central Government had nothing to do with the matter. That simply wouldn't work -- it's not a realistic idea. The Central Government certainly will not intervene in the day-to-day affairs of the special administrative region, nor is that necessary. But isn't it possible that something could happen in the region that might jeopardize the fundamental interests of the country? Couldn't such a situation arise? If that happened, should Beijing intervene or not? Isn't it possible that something could happen there that would jeopardize the fundamental interests of Hong Kong itself? Can anyone imagine that there are in Hong Kong no forces that might engage in obstruction or sabotage? I see no grounds for taking comfort in that notion. If the Central Government were to abandon all its power, there might be turmoil that would damage Hong Kong's interests. Therefore, it is to Hong Kong's advantage, not its disadvantage, for the Central Government to retain some power there.

You should soberly consider this point: Isn't it possible that there might some time arise in Hong Kong a problem that could not be solved without Beijing's intervention? In the past when Hong Kong ran into a problem there was always Britain that could intervene. There will always be things you will find hard to settle without the help of the Central Government.

It is the policy of the Central Government that the interests of Hong Kong should not be harmed, and we also hope that nothing will happen in Hong Kong itself that will harm its interests or the interests of the country as a whole. But what if something did happen? I should like to ask you to think this over and take it into consideration when drafting the basic law. You should also consider a few other things. For example, after 1997 we shall still allow people in Hong Kong to attack the Chinese Communist Party and China verbally, but what if they should turn their words into action, trying to convert Hong Kong into a base of opposition to the mainland under the pretext of "democracy"? Then we would have no choice but to intervene. First the administrative bodies in Hong Kong should intervene; mainland troops stationed there would not necessarily be used. They would be used only if there were disturbances, serious disturbances. Anyway, intervention of some sort would be necessary.

In short, the concept of "one country, two systems" is something new. In applying it we may run into many things we don't anticipate. The basic law will be an important document, which you should draft very carefully, proceeding from realities. I hope it will be a good law that truly embodies the concept of "one country, two systems" and makes it practicable and successful.