Hong Kong has always been proud of its economic achievement of the past decades. However, the economic turmoil that swept over East Asia has revealed the weakness in its economy, which, in turn, urges Hong Kong to reform its education system to meet the challenge of this era of information technology. There are many problems in Hong Kong's education system, including elitism, teacher-centered classrooms, outdated curricula, and ambiguous language policies. At the same time, Hong Kong is faced with fierce competition with its neighboring cities, notably Shanghai and Singapore. There is concern that Hong Kong cannot produce the suitable manpower to meet the needs of the changing economy. Reform proposals were first introduced in May 2001, with "student-focused learning,""no-loser,""quantity,""life-long learning," and "society-wide mobilization" as guiding principles. This paper aims at examining the reform proposals, their problems and possibilities, and their implications through contextual analysis and literature review. The significance of Hong Kong's education reform may help shed some light on education reform in other parts of the world facing similar problems in the process of rapid economic and social change. (Contains 40 references.) (RT)