There certainly will not be much crying on the Taiwan side. The Taiwanese will gain by far the most from direct links - which is ironic, as their government has put up the most resistance to their establishment.

For the record, a ban on direct transport, trade, and postal links, which was imposed by the Kuomintang as it fled the mainland after losing the civil war in 1949 to the communists, is still technically in place. Companies and individuals on both sides have had to find creative ways to get round it.

To their credit, the authorities in Taiwan have been changing as quickly as they can - again, ironically - since the election of the supposedly pro-independence Chen Shui-bian as president in 2000. Although Mr Chen still seems unwilling to use up his political reserve and meet Beijing halfway on the full establishment of direct air links, his administration has cleared away many other obstacles to direct trade and investment on the mainland. Progress has even been made on traffic going the other way, allowing more mainland goods and people into Taiwan.

Necessity being the mother of change, direct air links cannot be much further away. When they materialise, the boost to the Taiwan economy will be tremendous.

How so? First, for the most obvious reason: a reduction in costs for Taiwanese companies operating on the mainland. Considering that more than US$100 billion (HK$780 billion) of Taiwanese money (by fairly conservative estimates) has been pumped into mainland factories to date, that is not inconsequential.

Peter Kurz, a long-time investment adviser in Taiwan, believes direct air links will ultimately result in a broad re-rating of the Taiwan Stock Exchange. This is primarily because hi-tech companies depend on air cargo services, which will become cheaper with direct flights and will improve their time-to-market capability. But it is also due to less visible factors, such as increased efficiencies in the distribution of labour.

Which brings up the second most important gain from direct air links: the smooth and timely movement of people across the strait. A two-hour flight from Taipei to Shanghai makes it more realistic to base people where they can be used best, or moved at a moment's notice; the current day-long trek makes this extremely difficult.

It follows logically that more people travelling more frequently across the strait will stoke demand for air services and boost the tourism industry.

It will not only be consumers opening their wallets wider under such a scenario. Companies that have been holding out in Taiwan, for ideological or marginal cost considerations, will likely take the leap across the strait once cheaper and quicker flights are available. This, in turn, will stimulate demand for ancillary and go-between services among mainland (not to mention Hong Kong) service providers. It is a win-win situation all round.

Individually, the biggest winners will probably be the mainland airlines. Why? Because Hong Kong and Taiwan airlines already have a lock on cross-strait flights through Hong Kong and Macau. If flights are going to be taking place between, say, Chongqing and Taichung, there is no need to guess which side's airlines will get the lion's share of new business.

There will doubtless be losers, too. Jobs will vanish in Taiwan among blue-collar workers. Hong Kong middlemen will be cut out of the loop. But overall, Greater China will gain. And in the longer term, those jobs will be replaced with better-paying ones, while the middlemen will find more lucrative niches.

It is not Hong Kong citizens who should be worried about the future, but those who would compete with the growing economic entity of which they are a part.

Anthony Lawrance is the Post's managing editor

Graphic: LAWR09GET