Guangdong's party boss, Wang Yang , has floated the idea of a free-trade zone between Guangdong, Hong Kong and Macau. A feasibility study would soon begin on setting up a Guangdong-Hong Kong-Macau special co-operation zone aimed at lower customs barriers and smooth cargo and capital flow between the three regions, said Liang Guiquan, head of the Guangdong Academy of Social Sciences.

Mr Liang said nearly 30 government departments in the province, including the Development and Reform Commission and the Foreign Economic Relation and Trade Commission, attended a recent meeting with Mr Wang. 'Now each region has its own customs,' Mr Liang said. 'If the customs could merge, the efficiency of logistics would be greatly enhanced.'

Guangdong governor Huang Huahua said yesterday that Shenzhen should make use of its proximity to Hong Kong and consider forming 'twin cities'. 'There are many examples of twin cities in the world ... Shenzhen could explore such a possibility,' Mr Huang said on the sidelines of the National People's Congress meeting.