Technology policy and the re-industrialization of Hong Kong

The great economic successes of Japan, especially in the decades of the seventies and eighties, pose a challenge to the traditional model of how investment in scientific research enables a nation to gain an industrial advantage. For an economic power with a great technology base, Japan has made relatively little investment in basic research. Instead, it has gained its competitive advantage by focusing on advanced development and manufacturing. Is this the model for the economies of East Asia? Are the United States and the countries of Europe wasting their resources by their large investments in basic research, the fruits of which must be shared with world anyway? Should the nations with emerging economies invest in basic research? For Hong Kong these issues are particularly timely, In twenty years the manufacturing sector in Hong Kong has declined from 30% to 10% of GDP. Re-industrialization of Hong Kong would require a far more advanced technology base than that which exists now. Can that be achieved without changing the traditional free-market and laissez-faire policies of Hong Kong?