Hong Kong's Lost Decade, as Shown by These 12 Global Surveys
(Bloomberg) -- What’s ailing Hong Kong?
The Chinese enclave, long a favorite of the financial expatriate crowd for its low taxes, accessible beaches and vibrant nightlife, has seen its ranking slide across an array of international surveys in the past decade -- from the competitiveness of its airport to that of its best university. Singapore, which vies with Hong Kong, Tokyo, and Shanghai for supremacy among Asia’s financial centers, has held up somewhat better, while also suffering in some areas.
Hong Kong’s slumping ratings come at an awkward time for the city, which reverted to Chinese rule in 1997. A little over two decades later, closer ties with an increasingly assertive Beijing are raising difficult questions about everything from the independence of its judicial system to free speech.
Analysts, industry professionals and lawmakers have attributed Hong Kong’s declines in some areas to everything from lacking investment in higher education to the erosion of the "one country, two systems” principle that’s governed the city since its return to China, and a general sense of complacency brought about by the economic benefits from its ties to the mainland.
To gauge how Hong Kong’s position has evolved, Bloomberg News tallied up 12 international surveys that have been published annually or biannually for at least six years, where number 1 is the best ranking. It’s not all doom and gloom: Four of the surveys show Hong Kong gaining ground on competing destinations.
A notable area of concern for Hong Kong is education, with the city’s premier university being overtaken by that of Singapore in global rankings. “Investment in higher education isn’t diverse enough. It’s too focused on business and financial management and not on other subjects,” said Thomas Chan, director of the One Belt, One Road Institute in Hong Kong. It’s perhaps not surprising then that Singapore has widened its lead in innovation.
For a pair of low-tax havens, both Singapore and Hong Kong are doing poorly in terms of attracting talent. Hong Kong’s relatively poor showing in education may be part of the problem here -- along with living costs that are among the highest in the world. In terms of happiness, both cities lag far behind the Nordic nations, which have some of the most contented populations.
Companies raised $36 billion in first-time share sales in Hong Kong this year, more than anywhere else, helping the city edge up in a ranking of global financial centers. It’s also considered a safe place, especially for the tourists who flocked to Hong Kong in record numbers in 2018 -- many of them from mainland China.
Methodology: Current comparison used data from 2008 and 2018 except Rule of Law, Top City Destination for which most recently data available were from 2017, and International Logistics and Happiness Index for which the earliest available data were from 2007 and 2012 respectively.
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