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The Deal Sealed, Hong Kong Waits and Hopes

The New Year's celebration was lavish, but many residents are keeping the option to emigrate before or after China takes over

HONG KONG entered the Chinese New Year in February with an enthusiasm that overrode the coldest weather in memory. The current Year of the Rat is not all that auspicious. Its hallmark is austerity and simplicity. Not so the celebration, with Dragon Dancers and Lion Dancers, fireworks in the spectacular harbor and, for the first time, a procession with floats and bands in the Kowloon district - all, perhaps, more hectic than before because of what lies ahead. Hong Kong's jeweled fingers are crossed.

On July 1, 1997, Hong Kong returns to China after more than 150 years as a British colony. Britain's lease will simply have expired. But the transfer of sovereignty is historic in the true sense of the word. Hong Kong's 6 million people have made this speck of land one of the great modern money machines. It is the world's eighth-largest trading economy. Its gross domestic product is one-fifth that of China's.

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Economically, Hong Kong and China are quite compatible. Politically, they are poles apart. To be sure, it was not until last year that Britain empowered a fully elected Legislative Council. This infuriated Beijing, which does not want to inherit political democracy and has promised to eliminate the council. The bargain that China and Britain solemnly struck in December 1984 is that Hong Kong will, for 50 years after 1997, retain its capitalist system and lifestyle, its independent judiciary as well as the rights and freedoms the people have enjoyed. China has promised, ''one country, two systems.''

China's assurances have not dispelled the doubts of many Hong Kongers; sometimes they've done the contrary. The city will, of course, have a Chinese military garrison. On July 1, 1997, an elite unit, the Red First Regiment, will march in, expecting a warm welcome. It has reportedly learned a song, ''I love you, Hong Kong.'' In early February, Beijing introduced these men to specially invited Hong Kong business leaders and pro-Chinese figures. The troops fixed bayonets, shouting ''Kill, Kill, Kill.''

This does not necessarily betoken an oppressive regime. The tension that has marked Beijing's approach to Taiwan is absent from its dealings with Hong Kong. Here the transfer of sovereignty is set. The Chinese have no need to hurry. They have refused Portugal's suggestion to move ahead the date for taking over the much older, much smaller nearby colony of Macao, scheduled for 1999. They appear to be avoiding the risk of killing the goose that lays golden eggs and, one might add, of thereby also losing an example that could swing the future of Taiwan in their favor. Nevertheless, as things stand now, China will not permit practical democracy nor acknowledge the Bill of Rights written into the laws and administrative codes of the British colony.

Uncertainty pervades the city, marking family and business decisions. Many who can are sending at least one member abroad. Britain is preferred, but I met relatives of some who have visas to Singapore or to Australia. The Philippines is actively wooing Hong Kong firms with tax and other incentives.

Britain, with more than $100 billion invested in Hong Kong, is eager to promote stability through the transition. Damping any urge to escape before the transfer, it has ensured the people's right to leave after 1997. Apart from the 200,000 who are British citizens, it has promised just about every resident visa-free visits to Britain. Implicit is the possibility of their then asking for asylum should the new regime be intolerable.

Not everyone wants to leave Hong Kong. An estimated 30 percent of the population is quite happy to see China take over. They are Chinese, after all, and have in recent years developed the most intimate ties with the special economic zones in China's adjoining southern provinces. More than 3 million workers in Guangdong are employed by or on behalf of Hong Kong firms. Some 64,000 Hong Kongers work regularly in China.

Serious misgivings remain. Many had fled China to Hong Kong when the Communists seized power or during the chaos of the Cultural Revolution. When Beijing suppressed the Tiananmen uprising in 1989, more than 1 million people in Hong Kong took to the streets in protest. Pro-democracy forces are the largest block in the Legislative Council today. Among businesspeople, who might be more worried about money, there is fear that the corruption rampant in China could poison their prospects.

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The hope is that the rule of law, so deeply ingrained under the British, will have its own inertial strength and that Hong Kong's membership in dozens of international organizations in its own right (starting with the World Trade Organization, which has not yet admitted China) will keep its economy on an even keel. It may all hinge on whether China, having won its victory, can relax with its prize and resist the temptation of nationalist triumph.

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