A year before Hong Kong reverts back to China, its supermarket tabloids are battling it out for the lion's share of the newspaper market. Key combatants are two economic titans, one flamboyant, the other elusive, but both with rumored underworld connections. PNS correspondent Carol Hui, now based in Tokyo, worked for several years as a Hong Kong journalist.

Hong Kong is experiencing a guerrilla newspaper war which has already claimed a range of victims, from brutalized newspaper sellers to over 550 laid off journalists. With only one year before the transition of Hong Kong back to China, the turbulence in the media here has some political analysts worried about a less diverse press to act as a government watchdog.

Hong Kong's supermarket tabloids have taken the brunt of the casualties. Long the dominant media in the territory, these Chinese-language papers compete for sales with grisly murder tales, pin-up girls, movie star sexual orientations and -- only in Hong Kong -- horse racing tips determining sales figures. While bilingual Chinese elites skim through one of the colony's three English-language dailies for political and economic reports, they relax with papers like the National Enquirer, the Star, or the World Daily News -- the top sellers.

Jimmy Lai, who carved out a casual wear empire before entering publishing, sparked the newspaper war when he launched his Apple Daily last June at HK$2. Even after doubling the paper's newsstand price to $5, Apple Daily still rocketed to being Hong Kong's second largest-circulation newspaper at 310,000 copies.

Lai's success did not sit well with the Oriental Press Group (OPG), the powerhouse of the Hong Kong press. Late last year, they fought back by slashing their flagship Oriental Daily News (circ. 400,000) newsstand price to $2. Other newspapers followed suit, and soon small publications began to fold. The distributors of the two competing papers have threatened and roughed up small vendors to gain an edge.

Much of the media focus of the newspaper war has been on Jimmy Lai -- at 43, a press darling because of his easy accessibility, flamboyance and outspoken personality. The Chairman of OPG, by contrast, Mah-Ching Kwan, remains as elusive as he is notorious.

The Oriental Press building has tighter security than some Canadian banks, journalists employed by its English-language daily Eastern Express have joked. An electronic security center videotapes every floor and tape recorders capture everything including mundane elevator conversations. Armed guards comb the premises. Identity cards must be clipped on at all times. Employees are fined if they are repeatedly caught without displaying their card.

Rumor is that the tight security came about because of an armed attempt by a triad group to kidnap Chairman Mah from his office. Although this event has never been confirmed, it is not implausible. Rumors also circulate that the Mah patriarch is the notorious drug dealer White Powder Mah.

In the Chinese gossip press, it is often hard to discern fact from fiction. But it is certain that the patriarch of the Mah family was extradited by the Hong Kong government and banished to Taiwan for unspecified crimes. His son, Ching Kwan, was a puppet chairman from the start. A chubby, boyish 39-year old, Ching Kwan is often accompanied by OPG's shrewd managing director Herman Mah and the family's feng-shui geomancer.

To put the shady nature of the Oriental Press Group into perspective, Jimmy Lai is also rumored to have extensive underworld contacts. The Sing Tao Group, which publishes the third largest circulation newspaper (Sing Pao: circ. 230,000), also suffers from the ill-repute of its founder, Tiger Balm king Aw Boon Haw.

In the staff cafeteria of the Oriental Press Group, it is hard to tell the difference between editors and truck drivers. The dress, the language, the table manners are identical.

In fact, the core of journalism in Hong Kong is not a lofty field of intellectuals and social reformers. Critics who bemoan the current chaos should rejoice at seeing free enterprise at its Hobbesian best. It is economic Darwinism -- those who cannot compete will perish. This is the mentality that gave Hong Kong its financial success and it's no wonder that the major players also rank among the economic giants of the territory.

While this war has been a great benefit to newspaper readers, and an economic fat-trimming of the media industry, political analysts like Tam Chi Keung worry that a more concentrated news media "will make China's job that much easier. Less competition could mean less provocative news about China."

About the only thing Mah Ching-Kwan and Jimmy Lai have in common is a disdain for communism. Like the complex twists and turns of a Chinese historical saga, as 1997 approaches, the two leading publishers may put politics ahead of economics and ally themselves against a much larger opponent.