There are reasons for Hong Kong to feel optimistic these days. The stock market is gaining momentum, the government has reported a higher-than-forecast budget surplus, and an international credit rating agency gave Hong Kong its strongest ever vote of confidence.

The credit rating upgrade is in recognition of the city's strong economic fundamentals, according to financial secretary John Tsang.

Things certainly didn't seem so assured a few months ago when many Hong Kong economists and business leaders were fretting about the erosion of competitiveness, especially in capital intensive economic sectors, in the face of rising challenges from mainland cities, particularly Shanghai and Shenzhen.