Holding an enviable world title for almost two decades in an increasingly competitive global environment is a remarkable achievement. So there is every reason for Hong Kong to take pride in being named the freest economy for the 19th straight year. The top ranking is a welcome affirmation that we continue to be the most business-friendly economy. But the US-based Heritage Foundation also rightly cautioned that the city's standing might be eroded if more populist measures were to be introduced. The remarks should be food for thought for the government amid growing concerns over its ruling philosophy.
In his maiden policy speech, Chief Executive Leung Chun-ying did not shy away from adopting a more active approach. He stressed the government must be "appropriately proactive" in promoting economic development. While he agreed that the government should not intervene when the market functions efficiently, it must take action if the market fails. His approach has understandably aroused fears of over-intervention.
This is not the first time the foundation has expressed concerns about our commitment to economic freedom in recent years. The HK$28-per-hour minimum wage introduced by Leung's predecessor, Donald Tsang Yam-kuen, was already seen as a dent in our crown. With Leung under growing political pressure to deliver on his campaign promises, it will not be surprising if he rolls out more measures in future.
Whether it is proactive or interventionist is open to debate. Leung rightly introduced tougher measures to tackle soaring property prices. The locals-only land policy and special stamp duty introduced over the past six months are clear examples. On the whole, they have been well received by the community.
Leung's approach has yet to affect the city's ranking. But it does not mean there is no cause for concern. According to the foundation, our score slipped 0.6 from last year to 89.3, the lowest in seven years. The narrowing gap with Singapore is a reminder that we cannot rest on our laurels.
Although the credo "market leads, the government facilitates" has served us well, demands on the government to do more continue to grow. Populist measures seem inevitable. As the chief executive, Leung should run the city according to its needs. But at the same time he should be mindful of international perceptions of our economic freedom. After all, a free economy is what makes Hong Kong tick.