The scenario is not imaginary. Projections released by the Census and Statistics Department last month revealed that 27 per cent of the city's population of 8.38 million will be 65 or over by 2033. The next three decades will also see a slowdown in population growth. The number of deaths will have exceeded births by 160,000 and the median age will have risen drastically from the current 38 to 49. Life expectancy will reach 82.5 years for men and 88 years for women.

Since the early 1970s, projection figures have steadily declined as the government realised that having children was no longer as attractive an option for couples as before. It estimated in 1996 that the population size would reach 8.21 million in 2016. However, the 2003 projections suggested it would take at least 10 more years to reach that level.

Despite showing more acute symptoms in places such as Hong Kong, declining and ageing populations have now become a global problem. The world's population will rise from today's 6.3 billion to nine billion in 2300, not the 16 billion projected only 14 years ago, according to estimates released last year by the United Nations. The median age of the world will almost double from 26 to 50 years over the same period. Anti-ageing experts also suggested that life expectancy could reach 200 years in the 22nd century. And in less than 40 years, the world's fertility rate will have fallen to below replacement levels.

The UN report, entitled World Population in 2300, also indicated that in three centuries' time, 28 countries in developed regions - including Italy, Japan, Poland, Spain, the Russian Federation and Ukraine - would see their populations drop to between one-tenth and one-third of their size in 2000. China's share of the world population will plunge significantly from 21 to 14 per cent between 2000 and 2300.

The far-reaching implication is increasingly fierce, global competition for skilled labour and creative talents over the next few decades. National strategies are designed everywhere to encourage procreation and an inflow of highly skilled people.

Peter Hills, director of the Centre for Urban Planning and Environmental Management at the University of Hong Kong, and a member of several think-tanks within the SAR government and the UN, said a shift of focus from quantity to quality was necessary to cope with demographic changes in Hong Kong.

However, despite an expected decline in demand, the construction of roads, highways and flats has not slowed - a remnant of the city's 'build, build, build' strategy to cope with the population boom a few decades back.

'There is still a kind of carry-over to this way of thinking. It's almost certain that any future population growth will be much lower than we were used to in the 1980s and 1990s. But the system has not adjusted to that,' he said.

'The government also says they expect Hong Kong to be a magnet that draws [skilled] people in. But they don't say how that will happen.'

An unprecedented population policy released by the government last year grants foreign families the right of abode status if they are willing to invest $6.5 million on real estate or financial assets. The Immigration Department said the scheme had attracted 391 applications by the end of last month, including 185 overseas residents of Chinese origin, 157 foreign nationals and 38 Taiwanese. Formally approved cases totalled 139.

But critics doubt the impact of such an expensive residency scheme. They say other international cities also offer similar, if not more attractive schemes.

Professor Hills attacked the government's change of policy for overseas professionals, which he said had further restricted the inflow of talent. Since last July, the spouses of professionals can no longer take for granted that they can work in Hong Kong. They can only work if their own skills prove to be in shortage in the SAR.

Professor Hills urged the government to launch a more liberal immigration regime, including issuing work permits or one-year visas for overseas professionals who are required to come with a return air ticket and a certain amount of money. 'If you are successful, you get a job or start your own business. If you are not, you get your return ticket anyway,' he said.

Latest findings by the centre showed that Hong Kong was among the least diversified when it came to the racial and ethnic composition of international cities.

About 95 per cent of Hong Kong's population is Chinese, compared with a 46.5 per cent white population in New York, a 71.2 per cent white population in London, and a 76.5 per cent Chinese population in Singapore.

A spokesman for the Immigration Department said the policy change was made to reduce competition in the gloomy job market, but added that the number of overseas professionals coming to Hong Kong every year remained stable at about 16,000.

However, Francis Lui Ting-ming, director of the Centre for Economic Development at the Hong Kong University of Science and Technology, argued that the number meant little if the government did not count the number of overseas professionals who left Hong Kong for good every year.

Professor Lui, who has sat on various government think-tanks on population, education and economic policy, argued that Hong Kong lacked a diversified education system to cater for the children of overseas professionals.

He said tuition fees for international schools were high, not to mention that the schools often had long waiting lists. Mainstream schools, meanwhile, lacked the diversity to cater for the different needs and ethnic backgrounds of their potential overseas intakes.

University admission quotas for overseas and mainland students should be expanded from the current eight per cent to 30 to 40 per cent, as universities played a vital role for attracting overseas talents who could be the future link between Hong Kong and their hometown, said Professor Lui. 'A lot of mainland students preferred our universities to Beijing and Tsinghua universities. However, not that many of them can afford an annual tuition fee of over $50,000,' he said.

But the financially stretched government is hesitant to agree to such changes because of the resource implications. While the government is trying to merge and specialise the existing eight universities, Professor Lui said that Hong Kong needed more universities for its population of 6.8 million.

'Ideally, 70 per cent of Hong Kong's population should be professionals in order to ensure its competitiveness. But we only have 30 per cent now,' he said. 'The average number of years of schooling reaches about 15 in US, Europe and Canada, while Hong Kong only has 11 years.' He added that the US, which has about 40 times the population of Hong Kong, has more than 5,000 universities.

The UN's Human Development Index released this month showed Hong Kong had the least-educated population of countries at similar levels.

Apart from importing high-skilled foreigners, many developed countries have recently launched aggressive strategies to encourage couples to procreate. These include generous maternity allowances and the setting up of government dating agencies.

Many experts consider the impact of these strategies is limited. However, Daniel Shek Tan-lei, a professor of social work at the Chinese University of Hong Kong, said a revamp of family planning policy was urgently needed in Hong Kong to encourage couples to have children. He said that raising children today was rarely associated with enjoyment because of expensive housing, long working hours, job insecurity and the volatile education system.

'We are far from the days when the Family Planning Association hailed the slogan 'Two [babies] are enough'. The government and the association should consider from the macro level how to make marriage and birth a more attractive option for the younger generations,' said the professor.

'Financial incentives for pregnancies cover only the very basics. There needs to be lots of policy co-ordination to raise the quality of family life, including the provisions of better working and living conditions.'

Professor Shek said he was concerned about the use of the daily quota of 150 mainlanders to settle in Hong Kong on one-way permits as a major way of boosting population statistics.

'Without being discriminatory, the government has to understand that the majority of the migrants have a poor educational background. If it wants to raise competitiveness, it either has to do something to help this group, or think about whether the practise should go on non-stop,' he said.

And what about the white-haired group which is drastically growing in size? Cindy Lam Lo-kuen, associate professor of the family medicine unit at the University of Hong Kong, urged the city to move towards a paradigm shift in its treatment of the elderly.

'Physically or psychologically, Hong Kong is by no means a friendly place for the elderly. Apart from steep staircases and fast traffic, the group is always seen as the burden of the society,' she said. By contrast, countries such as Australia built 'elderly villages', a residential area with tailor-made entertainment, safety, and health facilities for old people.

Dr Lam said that the community - rather than only family members or the government - should shoulder the cost of elderly care. The community should soon address whether it can foot the cost of elderly welfare in the form of tax, insurances or other medical schemes, as well as define areas that should be publicly funded, she said. She also urged the government to mirror some western countries by deferring the retirement age from the current 60 to about 70, because of longer lifespans. Chua Hoi-wai, business director of Hong Kong Council of Social Service, urged the government to establish a fund which required the tripartite contributions of the government, employer and employee to ensure that an employee could live without financial difficulties after retirement age.

He criticised the Mandatory Provident Fund scheme for failing to enable many retired elderly - especially those who lost their jobs before the age of 50 - to be self-sufficient.

All things considered, it may take 30 or 40 years before the full impact of the population problem could be felt.

'Whether there will be enough men or women, or whether the age dependency ratio is high, is not something that most people ever give a thought to ... It's not perceived as being a mainstream livelihood issue because it is a long-term issue,' said Professor Hills.

'We need some bold and imaginative policy initiatives to open up access to Hong Kong economically and socially to a wider cross section of talented people from around the world.'