Despite its standing as one of the most robust Asian economies, Hong Kong’s shortcomings in higher education and innovation have once again prevented it from outstripping regional rival Singapore in an annual survey of competitiveness.
Hong Kong retained second place in the 2016 Asian Competitiveness report, released on Thursday at the Boao Forum for Asia Annual Conference currently taking place in Boao, in China’s Hainan province.
It’s the third straight year that Hong Kong has taken the runner-up spot behind Singapore in the survey, having slipped from first to third place in 2013. The findings are in line with last year’s Global Innovation Index, which placed Hong Kong second among Asian countries behind Singapore which was only kept off the top spot internationally by Switzerland.
Hong Kong’s stable, efficient and trustworthy business environment and financial market once again earned big scores in the latest survey. The report also highlighted the city’s commercial and administrative efficiency, as well as its social stability and low unemployment rate.
However, it didn’t fare so well when it came to higher education and innovation, ranking 10th among the 37 economies included in the index. These areas stood in sharp contrast to the city’s leading positions in economic and financial developments, the report said, without elaborating.
The Chinese mainland remained the ninth most competitive economy in the survey, unchanged since 2013. Its overall economic strength and pace of growth – even in the face of a slowdown – shows that its prospects remain promising, according to the report.
The research behind the index was carried out by the China Centre for International Economic Exchanges, which examines factors such as infrastructure , economic strength, human capital and innovation capacity to determine the rankings.
Unlike Hong Kong, the mainland was praised in the report for its innovation-driven growth model, which includes healthy investment in scientific research and higher education.
The competitiveness of major Asian economies was unaffected by the turbulence in global politics and markets last year, according to the report.
Most of the top 10 competitive economies in the list for 2016 were unchanged from a year earlier. Taiwan remained in fourth place, behind South Korea. Japan moved down one place to eighth.
In the face of global uncertainties such as US economic policy and the fallout from Brexit, Asian economies should consider working more closely together to overcome their heavy reliance on European and US markets, Lin Guijun, a professor at the University of International Business and Economics, said at a press conference launching the report.
First launched in 2009, the competitiveness report looks at 37 Asia-Pacific economies including Australia and New Zealand. It excludes 16 smaller economies in the region.
Last year was not a great one for Hong Kong in terms of its performance in various global rankings of innovation and competitiveness.
It dropped two places to ninth in the Global Competitiveness Index, which highlighted challenges for the city to “evolve itself from one of the world’s foremost financial hubs to an innovative powerhouse”.
And it tumbled three places into 14th in the Global Innovation Index 2016 (GII), produced by Cornell University, INSEAD business school and the World Intellectual Property Organisation. Singapore jumped one spot to sixth and was the only Asian territory within the top 10 of the GII ranking.
Asia’s technology hub South Korea placed 11th on the list, up from 14th last year. Japan ranked 16th, up from 19th last year.
Hong Kong’s business community has frequently cited the capacity to innovate as a major concern.