A major thrust of the reflation package is to boost high technology in Hong Kong and Shenzhen, regarded as virtual twin cities by planners on both sides of the Shenzhen River.

The hi-tech strategy seems promising because it is one area where there is a near-perfect match between the inclinations and aspirations of the SAR and Beijing leaderships.

According to insiders, Chief Executive Tung Chee-hwa has an intense personal interest in advanced know-how. The former shipping magnate shares the views of industrialists that it is dangerous for Hong Kong to put all its eggs in the services basket, particularly the speculatory stock and property markets.

'When my tenure is up, I shall leave office with regret if I have not done something to revive Hong Kong industry, particularly high technology,' Mr Tung reportedly told a senior Beijing cadre recently.

Despite the budget deficits, Mr Tung unveiled a dazzling, $5 billion hi-tech blueprint in his Policy Address this month. Close advisers such as Professor Tien Chang-lin and Edgar Cheng Wai-kin, who head respectively the Commission on Innovation and Technology and the Central Policy Unit respectively, have been asked to spare no effort to engineer a leap forward in this sector.

Most initiatives, however, will have to come from the mainland which already boasts formidable research and development facilities. The supply of land north of the Shenzhen River is virtually unlimited.

Mr Tung's zeal dovetails with that of Mr Zhu, an engineer-turned-economist who has told subordinates China would only avoid succumbing to the Asian financial crisis if it could boost the technological content of its products.

The two visions come together in Shenzhen. Together with Shanghai, the Special Economic Zone (SEZ) has been designated China's premier technology centre. After touring two ultra-modern plants in the SEZ last week, Mr Zhu pronounced himself satisfied that local bureaucrats had caught the technological bug.

'Everybody is swept by a hi-tech fever,' said a Shenzhen planning cadre. 'Thirty-five per cent of the SEZ's industry already belongs in the hi-tech category. Educational level is so high that chauffeurs working for top companies have master's degrees.' The cadre said Shenzhen might abolish its popular lychee festivals, where Hong Kong and foreign businessmen and journalists are treated to the succulent fruit every summer.

'We shall instead stage hi-tech displays to showcase our products, perhaps in the planned two billion yuan [about HK$1.87 billion] exhibition centre.' Officials and experts see exciting scenarios in three areas. Thanks to Beijing, a number of prestigious research laboratories and hi-tech facilities - including those affiliated with the Chinese Academic of Sciences (CAS) - have been transplanted from northern China to Shenzhen.

The zhongyang have at least committed themselves in theory to several science parks for 'joint Shenzhen-SAR hi-tech expansion'.

Secondly, Shenzhen and Hong Kong bureaucrats are studying the feasibility of an 'SEZ-SAR science park', to be created along the sparsely populated strips of land on either side of the Shenzhen River.

To be jointly administered by both governments, the so-called 'hi-tech buffer zone' will accommodate mainland scientists who otherwise would not be allowed to work in Hong Kong.

Apart from officials, this bold proposal is backed by top academics such as CAS president Lu Yongxiang and numerous heads of large state-owned enterprises (SOEs).

Thirdly, road maps have been sketched that show links between Hong Kong and other Pearl River boom towns. According to Guangdong party secretary, Li Changchun, a Hong Kong supporter, the SAR should go after a 'let both wings flap' strategy.

Mr Li said Hong Kong should look to both sides of the Pearl River. Instead of focusing on cities on the east side such as Shenzhen, equal attention should be paid to those on the west such as Zhuhai, Zhongshan, Jiangmen and Shunde.

As with most blueprints of this magnitude, this 'twin cities leap forward' scheme is up against practical and ideological hurdles.

Foremost is money. Given the tight finances in Chinese banks and SOEs, it is envisaged investments will have to come from Hong Kong companies - and those overseas financiers the latter could rope in.

'The formula is that the mainland will provide the land and technology, and the SAR will look after cash flow and marketing,' said a Shenzhen planning professor. 'Several hi-tech SOEs might move their headquarters to Hong Kong to tap the capital markets there.' Hong Kong tycoons, however, are famously allergic to projects with pay-back dates of more than two years. And many foreign executives would prefer to build theme parks, resort facilities or container ports in this area rather than a Guangdong-style Silicon Valley.

Questions of dollars and cents, however, pale beside political obstacles. Opposition to the hi-tech rose garden is being posed on the ground that it will jeopardise Hong Kong's tradition of laissez faire and government non-intervention, written into the Basic Law.

In the Asian context, the concept of hi-tech empires presupposes massive government injections and 'guidance'.

Mr Zhu, a fan of the Japanese and South Korean take-off models, has indicated it will not do for the private sector to handle sophisticated know-how. On the mainland, the sector is the preserve of the scores of Chinese-style chaebol Mr Zhu is propagating.

Paradoxically, it is Mr Zhu and his advisers who have raised this point with the Tung team.

'We must ensure that Hong Kong's hi-tech programme does not impair its tradition of a free economy,' a senior Zhu aide reportedly told Mr Tung.

Then there is the worry, at least among purists, that the concept of Guangdong-Hong Kong synergy and vertical Hong Kong-Shenzhen integration goes against the principles of 'one country, two systems', or 'well water not mixing with river water', despite the accepted view that 'one country, two systems' should mainly apply to the political arena.

The so-called Shenzhen River Joint-Administration Zone might appear to be a model for merging, rather than separating, systems. As Professor Tien pointed out, there are other questions concerning immigration, customs regimes, and the discrepancies between the roles and mind-sets of both 'partners'.

In the final analysis, the SAR must stay on top of the tricky pyrotechnics called mainland-SAR relations. In the 1950s, 60s and even 80s, the former colony benefited much from the fact that the mainland was a closed economy and largely left Hong Kong alone.

Not just Hong Kong's hi-tech dream but its survival hinges on how well the SAR ensures that its creativity and energy will not be stifled by the bear-hugs of the leaders of an increasingly open China.