In the story, the swallow is shocked when he sees a statue crying. After all, it is supposed to be an inanimate object. However, the swallow does feel sorry for the statue. So, the swallow's reaction is first shock and then sadness.
The swallow is then motivated to inquire about the statue's identity. For its part, the statue proclaims that it is the Happy Prince.
Surprised to see a statue with such a name crying, the swallow inquires as to the reason for the statue's tears. In response, the Happy Prince explains that he did not know the meaning of tears when he was alive. He was always happy, and this is why he was christened the Happy Prince. Accordingly, he lived a happy, privileged life on earth. After his death, however, his countrymen erected a statue in his memory.
The Happy Prince tells the swallow that he can now see the unhappiness in his city from his vantage point. This is why he is sad. Even though his heart is made of cheap metal, he can still feel emotions that were once foreign to him. Despite the swallow's initial reaction, the bird agrees to stay and help the prince realize his dreams for his city.