• Thu
  • Dec 18, 2014
  • Updated: 5:01am
NewsHong Kong
COST OF LIVING

It’s now cheaper to send expats to work in Hong Kong than the mainland

As city slips to fourth in global rankings, economists call for rethink on innovation

PUBLISHED : Wednesday, 21 May, 2014, 5:50pm
UPDATED : Thursday, 22 May, 2014, 4:16am

Hong Kong needs to rethink its approach to manpower and technological innovation, economists say, after it dropped out of the top three in a global competitiveness survey for the first time in a decade.

The city ranks fourth in the IMD World Competitiveness Rankings 2013 behind Singapore, which it lags in economic performance, higher education, English proficiency and adaptability to challenges.

The annual survey, which Hong Kong topped in 2011 and 2012, divides performance into four major categories - economic performance, infrastructure, government efficiency and business efficiency.

While Hong Kong is still ahead in business efficiency, its people are less open to foreign ideas, have less understanding of economic and social reforms, and do not value the idea of competitiveness as much, the report said.

It loses in a tight race on the economic front, due to a weaker domestic economy.

The Lion City surpasses Hong Kong in English proficiency and the proportion of adults having finished tertiary education. It also spends more on research and development.

Economist Andy Kwan Cheuk-chiu said Hong Kong's lower ranking did not mean a trend of decline. He said other reports such as the authoritative World Economic Forum's sometimes have opposite findings to IMD, but conceded that improvements were needed in R&D and education.

General Chamber of Commerce chief economist David O'Rear said Hong Kong remained competitive in the financial market and as a yuan offshore centre.

A labour shortage had been adding to costs, and the government must look to labour imports, he said. The US and Switzerland filled the top two spots.

Separately, an annual survey by resources consultancy ECA International shows that for the first time in five years it is cheaper for multinational firms to send expatriate staff to Hong Kong than to cities on the mainland.

Mainland cities leapfrogged Hong Kong to become the fourth most expensive place in the Asia-Pacific region for companies to send expat workers.

A middle-ranking manager sent to Hong Kong received benefits worth US$273,000 a year, while one sent to a mainland city received US$274,000.

 

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This article is now closed to comments

skywalker
mfchung, if you would understand something about Hong Kong, you would know that HK depends entirely on international business. Kick out expats, foreigners, visitors, international business travellers and introduce a visa for everyone and you will see Hong Kong going back to where it came from. A small and insignificant village on the banks of the Pearl River.
pierre.maunier@gmail.com
Japanese speak close to perfect english ?? Not the ones I met or work with... they need translators most of the time. HK english level is quite good in my opinion compared to them.
As for Singapore, I agree that HK is behind..
statman
It's not about qualifications. This is actually one of the main problems in HK as too much emphasis is put on academic qualifications and not enough on soft skills which are actually MUCH more valuable the higher up you go. I once interviewed a local who was academically brilliant and much more qualified than most yet he couldn't even look me in the eye or communicate. The interview was so disastrous that I ended it early.
zvichadashote
Hong Kong is self destructing if they want to remain as an "international" city. 30+ years ago HK started doing it right in terms of attracting expat and even local companies. Now between language deficiencies, pollution, racism against ****s (yes that is an issue), and government gridlock, businesses will start to flee. HK will slowly become another backwater Chinese city. If that is what Hong Kongers want, then it's OK. But if they want to keep international businesses here, it is doomed. I have run a small, successful business employing local Hong Kongers for close to 20 years. Eventually I will relocate this business out of Hong Kong because of the deterioration I stated above. Who will lose? Hong Kong...
chuchu59
2 decades or so ago Singapore didnt even come close to HK so far as English proficiency is concerned. For a report to state that Singapore has now surpassed HK in this area alarm bells should be set ringing. Standards are obviously slipping in HK whereas I am impressed by Singaporeans and Japanese who speak close to perfect English. Its an area we need to look at closely and improve without hesitation.
5359d7fb-6a28-4dc3-872c-34f80a320969
This is sad indeed. HK's level of English has fallen so much. As someone living here for over 20 years, I can see this in day to day life. It's sad to think we were once a British colony and now people on the street say "no engerlish". The government much change local education laws so that local schools can afford to hire and place importance on hiring proficient English teachers...and I do not mean those that speak CHINGLISH!!!
ed_kwok
This is the result of the disastrous mother tongue (Cantonese) teaching policy that was forced upon Hong Kong schools by the Education Bureau more than 10 years ago. What on earth were the bureaucrats thinking when they decided Cantonese would remain the main business/academic language even after 1997?
statman
This article is very misleading, i seriously doubt those middle managers 'received' $273k a year. More likely the total cost of their package to the company, including schooling, accommodation, partner support etc. came to that amount.
pjj
No, it is not 'cheaper' to send expats to Mainland. No, Mainland cities did not 'leapfrog' Hong Kong. The US$1,000 absolute difference translates to 0.4% of the total value of 'benefits received'. The authors should have pulled their pocket calculators.
viktorkwan
Singaporeans speak close to perfect English?
Hmm realli meh? Cannot be lah! Singapohreans speak Singlish and are veli proud of dat!!!

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