Reuters: Gloomy Hong Kong prepares for quiet handover party

The once seemingly unshakeable confidence of Hong Kong's people has been shattered by two recessions in four years and everywhere the mood seems grim. Unemployment is at a record high, bankruptcies are mounting and suicides are on the rise.

Reflecting the sombre mood, the government has promised celebrations marking the handover in mid-1997 will be modest.

Apart from a variety show starring local cultural groups and a fireworks display paid for by a private sponsor, there will be few signs of merrymaking.

Still, this July 1 could be more significant for the territory of nearly seven million than most. The city's leader, Tung Chee-hwa, will be sworn in for a second term and political analysts predict he will tighten his grip on the former British colony in the next five years.

The former shipping tycoon, who owes his position to strong support from Beijing, will be sworn in with a new team of 14 cabinet ministers whom he handpicked this month to run the government and report to him alone over the next five years.

Critics say the new ministerial system will increase Tung's clout and ultimately mean more control for Beijing over Hong Kong, which was promised a high level of autonomy under Chinese rule.

With a broader power base, Tung will be better placed to push through controversial new laws like an anti-subversion bill and possibly new taxes in his second term, analysts say.

Chinese President Jiang Zemin and other top Chinese officials are expected to be present at the swearing-in ceremony.

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Critics of Beijing have also received ample warning that they would be unwelcome in the territory for the handover anniversary.

Immigration authorities barred Chinese dissident Harry Wu and at least six followers of the […] Falun Gong spiritual movement from entering over the last 10 days.

Falun Gong has been banned on the mainland but remains legal in Hong Kong.

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More than a dozen different groups, involving 2,500 people, are expected to stage protests to mark the handover anniversary, police said.

Under Hong Kong law, large public demonstrations must be approved by police. Protesters are often assigned to designated areas off the beaten track and well out of sight of any visiting Chinese dignitaries.

Some of the groups will urge more democracy for the territory while others are expected to decry Beijing's crackdown on political dissidents and groups like the Falun Gong.

Most, however, are expected to blast the government for its inability to tackle unemployment and the protracted economic slowdown.

Some 60 percent of 751 respondents in an April survey said they were dissatisfied with the performance of Tung's government, up from 27 percent in a similar poll just before the handover. The study was released on Friday.

Thirty-seven percent of the people polled were pessimistic about Hong Kong's future, up from seven percent just before the handover.

The survey was carried out by the Hong Kong Transition Project, a team of academics which has followed public opinion since before the handover.

Tung's new team has pledged to combat unemployment and boost the sick economy, tasks that will be far from easy.

Chris Yeung, political editor at the South China Morning Post, says pressure is on the government to deliver quick results.

"But faced with a community shocked by the prolonged economic downturn and troubled by a deep sense of defeatism, the new team will find it extremely difficult to manage public expectation and ascertain public demands," he wrote in the Post this week.