All That Glitters Is Still Found in Hong Kong

Five years ago this month, Great Britain returned Hong Kong to the Chinese government. It seems only yesterday that the world anxiously awaited the change: What would happen to this glittering city on the South China Sea?

As it turned out, not much.

Eternally hitched to the star that is the Asian market, Hong Kong, now part of a Special Administrative Region of China, has continued to thrive, albeit with decreasing rights to democratic elections and free speech.

In early June the city held its annual Victoria Park vigil in honor of the anniversary of the massacre at Tiananmen Square--but with thinner crowds than ever and amid warnings from Hong Kong’s Chinese masters that next year the protest will be banned.

Although the mainland city of Shanghai is eclipsing Hong Kong as China’s cash cow, there are still signs that the former British holding will continue to be a powerhouse.

In fact, the city’s densely packed Central District is being gradually overshadowed by what will be Hong Kong’s tallest skyscraper, the 88-story Two International Finance Centre, to be completed next year.

For tourists, Hong Kong is more expensive than many cities in Asia. The U.S. dollar is permanently linked to the Hong Kong currency, eliminating the chance that tourists will enjoy windfalls from improved exchange rates. And some of the priciest real estate on Earth makes daily costs there far above standard Asian prices: Rooms at major hotels are geared to business travelers and can cost more than $300 a night.

But Hong Kong is still worth a visit, and its multicultural wonders can be yours for a song if you know where to stay. The city hosts what might be the best budget lodging in the world: the Salisbury YMCA, 011-852-2268-7000, www.ymcahk.org.hk, across Victoria Harbour on the leading edge of Kowloon.

Forget what you expect of Y accommodations. The Salisbury is as plush as a luxury hotel--three phones in each room, daily paper, fruit basket, room service, two restaurants, a pool, beauty salon--and many rooms have panoramic harbor views. During the summer, when the climate gets sticky, rooms range from $78 to $112 a night. The legendary Peninsula Hotel, right next door, charges three times as much for the same view.

For food, it’s easy to plunge into the city’s many markets (the most popular is probably the Night Market, on Temple Street west of the Jordan metro station), where the short-order chefs at “cooked food” stalls will prepare whatever you point to, and prices are $3 to $6 per heaping portion. Unlike in American restaurants, meats are always fresh; the chicken you eat was probably clucking around the kitchen when you ordered it.

The city is also chockablock with dai pai dong, or food stalls, which are humble storefront eateries, many run by folks who don’t speak English but know how to whip up an inexpensive meal.

Hong Kong’s subway is another bargain. The MTR, www.mtrcorp.com, goes everywhere you want for $1.40 or less. It is cool and quiet, and wired throughout for cell phone reception.

When it’s time to leave town, you can even check your luggage at two locations in the city and board a direct train to the airport for about $10.

Outside the markets, bargain shopping is not what it used to be. Catering to wealthy financiers, Hong Kong is stocked with expensive outlets like Burberry, Gucci and Fendi.

Electronics are often priced at U.S. levels, and increasingly, you must be careful what you buy, because manufacturers are creating compatibility conflicts to force consumers to purchase items in their home countries.

At particular issue are DVDs, which were once harvested by the dozens by bargain-hungry Americans but, like videotapes, are usually coded to malfunction on your home player. VCDs, low-resolution movies you play on your home computer, are an exception; you can buy the latest releases, with Chinese subtitles, to play at home for $1.90 to $6.50 at the discount stalls.

Pacific Delight Tours, (800) 221-7179, www.pacificdelighttours.com, sells vacations including flights from Los Angeles and six nights’ lodging at a mid-level Kowloon hotel for $890 during the summer. China Focus Travel, (415) 788-8660, www.chinafocustravel.com, maximizes touring time by combining a stay in Hong Kong with tours of five mainland cities; that 15-day tour, including air from the West Coast, is $1,799 during most months.