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

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.