LETTER FROM HONG KONG / Clifford Coonan: Hong Kong is booming. After the triple whammy of the bursting of the handover bubble, 9/11 and SARS, hotels are booked solid and cranes have risen again, adding to the territory's already awe-inspiring skyline.
Millions of tourists from mainland China are visiting, many of them expected for the May Day holiday, which is a week long here and a great opportunity for the well-heeled and fat-walleted from the People's Republic to shop till they drop in the world's shopping capital.
All this cheerful economic news means it's hard to find signs of major anguish in Hong Kong about the way efforts to introduce more democracy are being scuppered by a central government in Beijing which is equally set on showing the headstrong territory exactly who's boss.
This week, Beijing decided that Hong Kong will not be allowed to directly elect its leaders in 2007 or 2008, crushing hopes in the territory for a speedy move towards more democracy. The decision did not cause widespread demonstrations in Hong Kong like those seen last July, but it did annoy a lot of people.
Leading democrats stormed out of a meeting with Qiao Xiaoyang, deputy secretary general of the Chinese parliamentary committee which passed the law, to protest at what they dubbed "Beijing officials ruling Hong Kong". A group of more than 30 democrats, including most of the 22 pro-democracy legislators and their local government allies, stood up when Mr Qiao entered a meeting in Government House.
They waved a banner condemning Beijing's decision to deny universal suffrage in 2007.
Then the chairman of the Democratic Party, Mr Yeung Sum, read a stinging statement to Mr Qiao in Cantonese - a Chinese dialect which Mr Qiao, as a northern Chinese, doesn't understand - while Chief Secretary Donald Tsang Yam-kuen tried to stop him.
"The voices for democracy in Hong Kong have reached the heavens. We will never give up the fight for democracy, although the NPC scrapped universal suffrage by working in a black box. We will never give up our freedom," Dr Yeung said afterwards.
While Hong Kong's mini-constitution, the Basic Law, allows for the territory to change its election laws from 2007 to introduce more democracy, Beijing now insists no changes can be made without its say-so.
Chinese Premier Wen Jiabao, keen to allay fears that China is blocking democracy in Hong Kong, has pledged that Beijing will ultimately allow the direct election of the territory's leader and legislature, although he gave no timetable.
"The objective stipulated in the Basic Law has not changed - to ultimately realise election by universal suffrage of the chief executive and the Legislative Council of the Special Administrative Region," Wen said. Pro-democracy activists have been calling for universal suffrage in Hong Kong as dissatisfaction with the territory's Beijing-backed chief executive Tung Chee-hwa grows.
The decision by a committee of China's parliament, the National People's Congress, underlines China's strengthening hold on the former British colony, which was handed back to China in 1997.
Hong Kong's political system was shaken in July last year when half a million people marched against a controversial anti-subversion bill, forcing the unpopular Mr Tung to withdraw the proposal which had been introduced to please Beijing, which has draconian subversion laws of its own.
Beijing has been rattled both by the scale of the protests in July and uncertainty in Taiwan following its close-run election last month. Beijing views Taiwan as a renegade province, to be re-taken by force if necessary.
As it currently stands, half of Hong Kong's parliament, the Legislative Council, is returned via direct election, while the other half is chosen by pro-Beijing professional and business groups. Leading democrats in Hong Kong believe China has overstepped the constitutional mark and jeopardised the territory's promised '50 years no change' system, which was introduced after the handover to China and which gives the former British colony wide-ranging autonomy.
China's response is to insist that Hong Kong's system of even partial democracy gives ordinary people more say than they had under 156 years of British colonial rule. So far no one has pointed out a salient irony - that Beijing should judge itself by the standards of Hong Kong's former colonial ruler, Britain.
It's a David and Goliath situation and everyone knows that whatever the promises of autonomy, Beijing's word will carry the day. Some are appealing to Beijing to be magnanimous.
"Being in the driving seat, Beijing is in a position to do what Hong Kong people want to see most - a dialogue between Beijing and the democrats. Beijing can reach out as it has the relatively stronger power position," says political analyst Christine Loh.
Loh says this row is far from over. "Even though the endgame is clear, politically incorrect chatter will likely continue, perhaps with a sharper and more creative focus in Hong Kong."