In the same period, 1.6 million Taiwanese came to Hong Kong, a rise of 1.7 per cent - making the city their most popular destination, ahead of the mainland and Japan.

In the first half of this year, Taiwan was Hong Kong's sixth biggest export market, worth US$4.27 billion, and its fourth biggest source of imports, which reached US$14.35 billion.

The mainland and Taiwan started direct flights in 2008. Now, more than 100 flights a week link Taipei with 15 mainland cities. As a result, the number of Taiwanese visiting the mainland via Hong Kong fell 20 per cent.

'Good cross-strait relations are positive for ties between Hong Kong and Taiwan,' Lo said. 'They lead to an increase in activities of many kinds between the two and China.'

Many Hongkongers have an intimate knowledge of Taiwan, Lo said.

'A salesman in a shop selling French chocolate told me that he had been to Taiwan five times and visited a street stall that few people even in Taiwan had heard of. Hong Kong people like to go cycling on our east coast, visit the aborigines in the mountains of the southeast and shop at our bookshops.

'For their part, Taiwan people love Hong Kong popular culture - music, films and magazines - although it has lost some market share to the cultures of Japan, South Korea and Thailand,' he said.

Going to Taiwan became even simpler for Hong Kong and Macau residents from September 1, after the National Immigration Agency said they could apply for visas on the internet. Print-outs can be presented on arrival at airports in Taiwan. This was announced during a visit by Financial Secretary John Tsang Chun-wah to Taiwan in August. He was the highest-ranking Hong Kong official to visit since the handover.

Official ties have lagged far behind unofficial ones, in part because it is Beijing and not Hong Kong that decides on the level of contact with Taiwan. The Trade Development Council is the only government body with an office on the island.

Hong Kong's ties with Taiwan reflect those of the central government. During the Democratic Progressive Party's rule from 2000 to 2008, Beijing-Taipei relations were frozen and Hong Kong followed suit. Since the election of Taiwanese President Ma Ying-jeou in March 2008, relations have greatly improved with both Beijing and Hong Kong, making the visit by Tsang possible. Many senior Kuomintang figures have visited Hong Kong and been warmly received by Donald Tsang Yam-kuen.

Lo said his government would welcome more Hong Kong institutions to open offices in Taiwan.

For Hong Kong, any fall-off in Taiwanese visitors has been more than compensated by the flood of mainland travellers. According to the Tourism Commission, Hong Kong received 16.9 million visitors in the first half, up 23.1 per cent from a year ago. Of those, 10.5 million came from the mainland, a rise of 27 per cent.

'With 34 million visitors a year, Hong Kong is one of the great tourist cities of the world, like Venice,' Lo said. 'To handle such a large number of people in so small an area is a miracle of urban management.'

He said individual travel by mainlanders to Taiwan was inevitable and the next stage in relations. 'It would be a good thing for us. It would spread the economic benefits more widely than the travel companies, hotels, shops and restaurants that tour groups are restricted to now.

'But we will have an overall ceiling to ensure that we have sufficient hotels, restaurants and other facilities to deal with the numbers.'

With no official status in Hong Kong, Lo's mission is different to that of a conventional diplomat. He was reluctant to talk about the level of access he has to official society - including mainland government agencies - but said relations were very friendly.

His main role is as a bridge to civil society in Hong Kong, with a particular focus on media and culture. This is his area - a graduate of National Taiwan University's philosophy department, he spent 16 years at China Times, one of Taiwan's two best- established newspapers. He then moved into television, radio and magazines. He published his first volume of poems in 1975 and has written many poems and novels since.

'Hong Kong is the best place in the world to promote the soft power of Taiwan, to reach the people of Hong Kong and the 20 million mainlanders who come every year,' he said. 'Here, there is no language barrier and Hong Kong media and people are very interested and well-informed about Taiwan. In Tokyo or New York, Taiwan is marginalised.'

Although cultural events organised by Lo's centre attract a full house, he sees Taiwan as more diverse and culturally rich than Hong Kong.

'Here, the most important value is money. Rich people are aloof and consider themselves better than other people. In Taiwan, there are different values - money, charity, creativity and individuality. Rich people and business leaders are humble and do not look down on others,' he said.

'Aboriginal people account for a small minority of the population and are not so well off but are proud of their identity and culture. You need a very progressive society for this.'

But he noted Hong Kong's efficiency and status as an international city. 'No one feels a foreigner here. ... There are very few places like this in the world - a global city like New York. Hong Kong and Taiwan complement each other.'

Cultural bridge

Unofficial bodies are using soft power to promote Taiwan in HK

In the first eight months, this many Taiwanese visited their most popular destination choice - Hong Kong: 1.6m