The Anti–Hong Kong Dollar Campaign and the Remaking of Economic Life in South China, 1949–1951

Abstract: Before the Chinese Communist Party came to power in 1949, about half of the total of 800 million Hong Kong dollars in circulation were in China. This article examines how the new regime carried out an anti–Hong Kong dollar campaign to enforce the use of renminbi currency in economic life. In contrast to the many early campaigns of the People's Republic of China that relied on moral suasion, the leaders of the anti–Hong Kong dollar campaign learned that they needed to adopt economic incentives for people to change their behavior. Even so, Communist leaders faced limitations in their attempts to adjust the exchange rate, which led to uneven impacts on different social groups. Furthermore, local leaders found that they needed a timely supply of goods to sustain the purchasing power of the renminbi, goods they were only able to obtain through trade conducted in Hong Kong. This article thus demonstrates the entanglements between domestic economic life and foreign economic relations in China's revolutionary transformation.