Opinion | Hong Kong and Singapore, so similar yet so different – it’s all about housing, money and politics

Political power is supreme in Singapore, while money dominates politics in Hong Kong. Why can’t Beijing see how the dreams of Hong Kong youth are being crushed?

With housing so out of reach, any spark can trigger uncontrollable riots. Instead of being amazed by city’s turmoil, one should wonder why it took so long

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Published: 12:00pm, 1 Aug 2019Updated: 12:01pm, 1 Aug 2019

Even as Hong Kong is engulfed in seemingly endless turmoil, Singapore remains as tranquil as its sleepy self ever was. Many Westerners, often quite naïve, tout both cities as paragons of free market economy to criticise their own governments. The two often top their list of the freest economies.

But the stark contrast in their political fortunes tells us that the two cities are very different. In Hong Kong, money dominates politics, while political power is supreme in Singapore. This difference can explain much of what we see.

Hong Kong and Singapore thrive by providing a playground for people from everywhere to take advantage of opportunities elsewhere. Low tax and lax regulation are the main attractions. Inevitably, their labour and asset markets are global. How could their people compete for good jobs or housing against the whole world? Singapore has figured that out, while Hong Kong’s ruling elite refuse to recognise this.

Singapore or Hong Kong’s economic model is largely about arbitraging the inefficiencies, or loopholes, in their larger neighbours. To some extent, money laundering is the core business. It doesn’t take a genius to come up with this economic model. How hard could it be? You just need a powerful friend for protection. Singapore has the United States. China just lets Hong Kong get away with it. It believes that what’s in Hong Kong stays in China anyway. And some powerful vested interests need Hong Kong to get their ill-gotten wealth out.

When the money rolls in, how the spoils are divided determines stability. Singapore recognised early on that locals couldn’t compete against the world for housing.

Private-sector apartment blocks on the waterfront in Singapore. The Singapore government has recognised early on that there needs to be a housing market that caters specifically to locals. Photo: Reuters