Both were tipped as possible contenders in next year's leadership selection process against the Beijing-backed incumbent Donald Tsang.

But the summer appears to have dulled the fighting edge of the so-called "Handbag Brigade", with Ip recently stating outright that she would not run and Chan thought to be preparing a similar statement.

Ip says she will concentrate on her new conservative think-tank and may consider running for the legislature, while Chan is said to have been unable to get the support she needs to challenge Tsang.

"It's a reflection of the political reality here," said Professor Joseph Cheng of the Hong Kong City University Department of Political Science.

"Beijing supports Tsang's re-election and everybody expects him to win withut much difficulty," Cheng said. "What is the point in running against him?"

Tsang, Chan's successor and a former finance chief, was selected to lead Hong Kong after the first post-colonial leader Tung Chee-hwa stepped down early into his second term in March 2005.

Chinese leaders were said to be wary of him but in the absence of any alternative and given his huge popularity among Hong Kongers, they gave him their blessing.

Tsang is considered a shoo-in for re-selection in March as he is the only potential candidate that has the Chinese government's blessing.

Although Hong Kong was granted near autonomy when sovereignty was handed from Britain to Beijing in 1997, China still effectively controls the political scene.

It reserves the right to veto any legislation and effectively selects the territory's chief executive by means of an electoral college of 800 elites.

As well as China's support, candidates in the convoluted selection process are required to win the nomination of at least 100 of the electoral college delegates in order to go through to the selection round.

Democrats have long sought to dismantle the process and replace it with a direct election, a change China and the Hong Kong government have resisted despite the post-handover constitution's provisions for the introduction of universal suffrage.

Chan and Ip, say experts, were never going to be able to garner enough support to topple Tsang.

"I think their best hopes would have been to prevent Tsang from winning by default, as he did in the last selection when nobody ran against him," said leading pro-democracy legislator Ronnie Tong.

Ip's conversion to pro-democracy politics surprised all who remembered her as a hardline pro-Beijing security chief during her five years in office. As a result many democrats are reluctant to accept her into their fold.

Chan, however, was welcomed with open arms.

After a year of failing fortunes, the pro-democracy camp has been boosted by the backing of one of the city's most popular and articulate politicians.

Chan's retreat now puts renewed strain on democrats as they prepare to contest March's selection process.

"There's a chance she will continue to play a vital part in the movement," said Tong.

"Democrats are still committed to fielding a candidate, not to win, but to engage Mr Tsang in debate and the draw the public into the process," he said.

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