Fruit Chan seems to like working backward. For his latest release, The Longest Summer, the Hong Kong director initially filmed footage of real-life events surrounding the city's 1997 "handover" to Chinese rule--including People's Liberation Army tanks rumbling across the border. He weaved in the plot a year later. "I just shot the scenes, without knowing what the story would be about," says the stocky, affable Chan, who also wrote the screenplay. Looking backward once more, he has decided that Summer will be the second film in a trilogy exploring the former British colony's return to China, a historical moment that he fears is having dire social consequences.

Chan, 38, is not the first director to take on the subject. Peter Chan's Comrades, Almost A Love Story (1996) examined the strained relationship between Hong Kong and mainland people as the transition approached. And Wayne Wang's disappointing The Chinese Box (1997) planted a lovesick and dying British journalist at the center of various handover-related events to probe local issues of identity.

Summer is the most ambitious exploration to date of the handover's impact. The film follows a group of Hong Kong soldiers demobilized after the British garrison disbands. Brothers Ga Yin (Tony Ho), one of the former military men, and Ga Suen (Sam Lee), a triad member, plan a bank heist with four other ex-soldiers. Besides being unemployed, Ga Yin has an ulterior motive: he wants to persuade his younger brother to give up the underworld but knows he needs cash as an incentive. Desperate for work in economically depressed Hong Kong, Ga Yin himself ends up joining the triad, rationalizing: "It's just a job." Trying to cope with the uncertainty of civilian life, however, leads him to a breakdown.

Chan excels at gritty depictions of how the city is changing. His Made in Hong Kong (1997) explored the grim lives of displaced triad youth. For that, Chan used a cast of amateurs (Sam Lee made his debut here), a skeletal five-member crew, footage salvaged from films he had previously worked on and a shoestring budget of $80,000. Summer had a $1 million budget, but Chan still employed a mix of experienced and amateur actors, including two former British soldiers he chanced upon at a military surplus sale.

The new film, which debuted in Hong Kong in February and will open elsewhere in Asia this year, looks anything but bargain basement. Chan is adept at creating quirky, ironic snapshots of everyday life using an ensemble of secondary characters: a rambling taxi driver, a wisecracking triad boss, cliques of giggling, bullying schoolgirls. Summer tackles weighty issues, like Hong Kong's obsession with money. But a subplot involving romance is refreshingly unpredictable--much like the outcome of the bank robbery. Above all, Chan wants to explore the political and economic challenges Hong Kong faces. "No one is concerned with how our value system is changing," he says. "For Hong Kong to go from prosperity to this collapse calls for reflection." With Summer, Hong Kong has a filmmaker who understands its plight.