Hong Kong's International Financial Centre: Retrospect and Prospect

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GFC 8 (2010) Rankings of Areas of Competitiveness
Rank People Business Market Infrastructure General
Environment Access Competitiveness
1 London New York New York London London
2 New York London London New York New York
3 Hong Kong Hong Kong Hong Kong Hong Kong Hong Kong
4 Singapore Singapore Singapore Singapore Singapore
5 Tokyo Chicago Tokyo Tokyo Tokyo
6 Shanghai Tokyo Shanghai Chicago Shanghai
7 Chicago Shanghai Chicago Washington Chicago
8 Zurich Zurich Zurich Zurich Zurich
9 Geneva Sydney Seoul Boston Toronto
10 Boston Geneva Toronto Geneva Sydney
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All things considered, the compilers of the GFC surveys conclude that over the past
decade, and especially over the past two years, the reputational gap between London and New
York, one the one hand, and Hong Kong, Singapore, and other Asian centres, on the other, has
been diminishing rapidly. Within the region, Hong Kong and Singapore are today locked in their
own competition for regional leadership, but Shanghai and Shenzhen enjoy rapidly improving
reputations. Comparisons are worth examining in more depth in this changing regional context.
Hong Kong and Singapore
Although striking differences exist in the underlying political economies of Hong Kong
and Singapore, they share many historical characteristics. Both entered the modern era as
colonies of Great Britain, Singapore in 1819 and Hong Kong in 1842. The main legacies of
relevance to both of their financial markets today are the British common law tradition and the
English language. Luckily for both, the British and then the Americans built the foundation of
the global economy as it has evolved since the nineteenth century upon those legal and linguistic
building blocks. Chinese emigres seeking a better life for their families adapted well to those
traditions and, without losing their own cultural heritage or personal networks, they built
adaptable and successful societies.
Breaking from Great Britain in 1959 and from the Federation of Malaysia in 1965,
Singapore became an island-state dominated by overseas-Chinese. Of its current population of
4.8 million, 75% claim Chinese roots. For its part, Hong Kong’s relative autonomy from China
was guaranteed in 1997 upon the basis of a population now comprising 6.9 million, 95% of
which is Chinese. By 2009, Singapore’s booming economy recorded a GDP of US$177 billion,
or US$37,000 per capita, while Hong Kong expanded to US$210 billion, or US$30,000 per
capita. Certainly in comparison with regional neighbours, two ‘economic miracles’ accounted
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