Many thanks for your comments, there is an ongoing discussion about all of this under "5 year old won't sleep in own room". There are many of us out there!
My 8 year old daughter has had the same problems at night for the past 5 months. We are seeing a pediatric counselor and we've made small positive steps in only 3 visits. She is learning to deal with her anxiety and we've been able to do things for her (like putting a lite in her closet since she was afraid of it) based on the counselor's suggestions. It is not a quick process but it will certainly make you feel like there is hope for normal nights in your future. Hang in there...
Thanks for your comments. This is what I thought we would have to do but as we live in Hong Kong most of these types of treatment and counselling are way too expensive. Also we don't want to put our daughter on any drugs at the moment. We will definitely think about counselling though.
This version of separation anxiety tends to persist without some intervention. Separation anxiety is a type of anxiety disorder. With some children it is evident at a very young age, but with others it starts later in the school years. It would make sense to have her see a pediatric mental health professional. This person can evaluate her condition and guide you in how best to treat it. Sometimes a sytematic program of behavior management will suffice; at other times a course of cognitive-behavioral therapy (in addition to the behavior management) is warranted; and sometimes the above interventions in combination with medication is useful.