First we had a commission, appointed in March last year, recommending that several industrial and technology initiatives be merged and making suggestions about how to spend a HK$5 billion Investment and Technology Fund.

It was mostly ho-hum stuff chiefly notable for implicitly conceding that Cyberport and Science Park are flawed initiatives and for recommending that we spray public money at small entrepreneurs who can make themselves look like technology firms.

Welcome to the sheepfold, you wolves out there.

Dress yourselves up in sheepskins and you too will be invited to a $500 million mutton dinner.

Then came the important announcement. A US venture capital firm, Hambrecht & Quist, is to lead a consortium including such names as IBM, Intel, Sun Microsystems and Hewlett Packard in setting up a US$1.2 billion semiconductor plant in Hong Kong.

Now think about that. Everywhere across Asia, governments are desperately pleading with foreign investors to set up hi-tech facilities of this sort in their countries.

They are on their knees offering free land, tax breaks, investment grants, special roads, subsidised power, everything they can pull out of their bags and yet the biggest of these projects recently has gone to Hong Kong.

The details of what we are offering have not yet been revealed but it seems to involve little more than making available a cheap site graced with the name 'Silicon Harbour'.

It would not actually be a concession. Industrial land is worth very little anyway when all the industries that were meant to have occupied it have moved across the border. The Tai Po Industrial Estate is practically marked down to zero to get anyone to occupy it.

So here we are lamenting that Hong Kong is not keeping up with the regional competition in technology and that soon we'll be relegated to the economic dung heap unless we rush to throw billions of dollars at electronic fancies.

Well, the evidence is in and it's just not so. We have a project to tell us that Hong Kong, in just the state it is, rates as a fine place for big name technology ventures, thank you.

We have the low costs in industrial land, in tax, services and communications, we have the infrastructure, the central port, the political stability and those absolute requirements, a sound legal system and an entrepreneurial tradition.

Most of all, we have one of the world's biggest industrial centres right across the border, just where you want it for the flexibility, the engineering consultations and the quick shipments that a capital intensive project like this needs.

As much to the point, the innovation and technology recommendations we got on Monday would make no difference at all to our getting a project like this. It was our boring old plus points that got it for us, the ones that so many people say are no longer enough.

No longer enough? They are the fundamental basics, always have been, always will be and we have them.

It is rather the innovation and technology proposals that are peripheral. The only way we can ever be a big name in technology research without a military budget is to spend billions upon billions with no concern about the commercial return we get from the money.

We are too small a place. Any truly viable ideas we come up with will inevitably be put to work somewhere else and someone else will make the money from them.

We will wind up brilliant but impoverished, just like the academics who came up with these proposals.

What is more, such a wastage of effort will endanger our real advantages. Our boring old market economy principles are all we need. The Chief Executive has his thinking cap on the wrong way here.

mont1glo