Are Hong Kong and China too close for comfort?

Chinese business has caught a virus that will be contagious to Hong Kong.

Now how do you describe China's business relationship with Hong Kong?

Whatever metaphor you dream up, or fancy adjectives you choose, the phrase you'll wind up creating will simply be another version of ". . . as close as lips and teeth." Because that's what this relationship really is.

Chinese Premier Wen Jiabao's pronouncements that business conditions in China may be “relatively difficult” this quarter and that China sees ". . . downside pressure on our economy and elevated inflation at the same time,” while startling, were nothing compared to his kicker: “We also face problems of weakening external demand and rising costs for companies.”

Put in another way, Chinese business has caught a virus that will be contagious to Hong Kong.

China's domestic investors, already reeling from a 2-1/2 year slump in the mainland’s markets, were understandably aghast. And the stock market showed their pain.

The Shanghai Composite fell 1.4 percent, dragging down stocks in Hong Kong's Hang Seng, which immediately lost about a third of its gains on Jan. 2. The Hang Seng index closed lower at 0.8 percent on Jan. 4.

This example of extreme closeness is bound to be repeated in the weeks ahead if China's cold turns into a raging fever.

Wen hinted that hinted the government is not ready to implement another massive stimulus package as it did during the 2008/09 global crisis. He did, however, say China would fine tune its policies as slowdown concerns increase.

Chinese shares have underperformed its Asian counterparts for two successive years since Beijing implemented policies to tame inflation and deflate ballooning property prices.

The Shanghai Composite ended 2011 lower by more than 21 percent. The Hang Seng lost 20 percent of its value in 2011.

It's a glaring example of how close China and Hong Kong are. Perhaps, too close.