Top spot for economic freedom welcomed but there are worries

BUSINESSMEN are warning that the high cost of doing business in Hong Kong may impair its competitiveness, even though the territory is said to have the world's most-free economy.

For the second consecutive year, the Heritage Foundation, a United States research institution, has placed Hong Kong at the top of its 1996 Index of Economic Freedom.

Government officials and the private sector welcomed Hong Kong's top placing among the 142 countries surveyed. This year Hong Kong managed to edge out Singapore. Last year the two tied for the top spot.

President of the American Chamber of Commerce Frank Martin said the maintenance of the rule of law and an independent judiciary were crucial to Hong Kong's competitiveness as a Special Administration Region.

The Heritage Foundation report gave high marks to the territory for a free and open market devoid of Government interference, and taxes that are low and predictable.

Governor Chris Patten, after meeting Heritage Foundation delegates at Government House yesterday, said it was encouraging to see Hong Kong receiving top score in key areas under assessment.

He said: 'It remains our ambition to do everything we can to safeguard all those attributes and hope we will be able to keep up with the index both before and after 1997.' Financial Secretary Donald Tsang said: 'We firmly believe in private enterprise and small government so that business will have the freedom and the opportunity to generate the wealth our economy needs.