"In 2023, Hong Kong's total GDP will be US$383.5 billion, while Singapore's will be US$501.3 billion, and the GDP gap between the two places will widen to US$117.8 billion. ”
Text / Ba Jiuling
Singapore's rulers are about to change.
On April 15, Singapore's Prime Minister's Office announced that Lee Hsien Loong would resign as prime minister on May 15 and Deputy Prime Minister and Finance Minister Lawrence Wong would be sworn in as prime minister.
Since coming to power in 2004, Lee Hsien Loong has become a very good politician in his two decades as prime minister, like his father Lee Kuan Yew and his predecessor Goh Chok Tong. Under the leadership of these three prime ministers, Singapore has transformed from a poor and dilapidated "small country" to a developed country with a per capita GDP of more than 80,000 US dollars, and has created two golden national business cards - "global tourist destination" and "international financial center".
Just a month before Lee Hsien Loong announced his resignation, Singapore also attracted global attention with these two business cards.
In Singapore, many tourists visit Merlion Park
First of all, the prime minister personally stood on the stage and used an "exclusive agreement" to bring in the famous American singer Taylor Swift (nicknamed "Mildew") for a week-long concert, bringing a total of 500 million Singapore dollars (about 2.67 billion yuan) of tourism revenue to Singapore;
Later, in the 35th edition of the Global Financial Centres Index (GFCI), Singapore ranked third in the world (behind New York and London) ahead of Hong Kong.
With the success of Singapore's concerts and the leading financial industry, our eyes have also turned to its biggest rival - Hong Kong, China. Asia's once-unshakable financial center seems to be increasingly unable to compete with Singapore, which is under the Lee family, in the 21st century.
Recently, most of the heated discussions about Hong Kong are due to the soaring transaction volume of its property market, which has led to economic recovery. But netizens who saw the news did not bless Hong Kong, but ridiculed Hong Kong for having "real estate dependence".
In recent years, there have been more and more comments on the Chinese Internet that degrade Hong Kong. Some people say that "Hong Kong is falling, Singapore is full", and others say that "Hong Kong is becoming a ruin of an international financial center".
In today's article, we will make a comparison from several dimensions, such as the financial industry, port trade, manufacturing, and emerging industries, and draw an objective and pertinent conclusion.
Finance: Hong Kong remains the biggest cornucopia
The financial industry, which is the first battlefield between Hong Kong and Singapore, is very competitive.
First of all, Singapore's financial situation is really good. Since the geopolitical upheaval, more and more wealthy people have emigrated to Singapore, and the rate of hot money pouring into Singapore has been getting faster and faster.
There are data to back it up. The number of single-family offices (single-family offices (agencies that manage assets and mobilize resources for wealthy families) in Singapore surged from 28 in 2018 to 400 in 2020 and soared to 1,400 by the end of 2023.
According to the 2023 Global Rich List released by Forbes, the total number of the world's richest people has decreased by 28 compared with 2022, while Singapore's richest people have bucked the trend by 9.
However, after all, Hong Kong has been the "big brother" for decades, and its family foundation is still a little thicker than Singapore.
At the end of 2021, the market capitalization of the Hong Kong stock market was HK$42.4 trillion, Singapore's HK$4.6 trillion, and Hong Kong was more than nine times that of Singapore. In 2021, the daily turnover of the Hong Kong stock market was HK$41 trillion, compared to only HK$1.9 trillion in Singapore, and Hong Kong was 22 times that of Singapore.
At the end of 2021, Hong Kong's total RMB deposits totaled $900 billion, compared to Singapore's $175 billion, five times the former.
HSBC Headquarters in Hong Kong
Hong Kong's insurance industry has assets under management of over US$4.5 trillion, ranking first in Asia and second in the world. 12 of the world's top 20 insurance companies are authorized to carry on insurance business in Hong Kong.
According to the Global Wealth Report released by BCG, a U.S. consulting firm, Hong Kong manages US$2.2 trillion in foreign assets and US$1.5 trillion in Singapore.
It is worth noting that investment bankers who moved to Singapore during the pandemic are returning to Hong Kong one after another. About a third of UBS's more than 20 former Hong Kong employees have returned.
Financial professionals prefer Hong Kong because it offers higher treatment.
According to Bloomberg Industry Research, the average annual salary of an investment bank analyst in Hong Kong is about US$92,149 (about HK$718,400), about 46% higher than that of Singapore.
The area around Central, Hong Kong
It can be said that whether it is stocks, bonds, foreign exchange, asset management, or wealth management, Hong Kong's financial market data is stronger than Singapore's.
When asked, "Are you worried that Hong Kong's status as an international financial center will be replaced by Singapore?", the Secretary for Financial Services and the Treasury of the Hong Kong SAR Government, Mr Christopher Hui, replied categorically: "I have no such worries at all." ”
How strong Hong Kong's financial position is depends critically on the global influence of the Chinese economy. As long as China's economy continues to prosper and insists on opening up to the outside world, the demand for Chinese enterprises to go overseas will become stronger and stronger, and the ability of Hong Kong financial institutions to "make money" will become stronger and stronger.
Port Trade and Manufacturing: Hong Kong is not as good as Singapore
Although Hong Kong's financial sector is larger, Hong Kong's economy is not as large as Singapore's.
As early as 2010, Singapore's GDP surpassed that of Hong Kong. By 2023, Hong Kong's total GDP will be US$383.5 billion, while Singapore's US$501.3 billion, widening the GDP gap between the two places to US$117.8 billion.
Why did Hong Kong, which has a larger population, a wider land area, and a deeper precipitation, lose out to Singapore in this area? The problem lies in port trade and manufacturing.
Singapore's port is busier than Hong Kong's. In 2023, the Port of Singapore will handle 591.7 million tonnes of cargo, more than three times that of Hong Kong. According to the container port rankings of maritime consultancy Alphaliner, Shanghai ranked No. 1 in 2021, Singapore ranked No. 2, and Hong Kong fell to No. 10.
The bigger difference between Singapore's port terminals and port trade is the manufacturing industry. Since 2020, the value added of Hong Kong's manufacturing sector has accounted for less than 1% of GDP.
Singapore, on the other hand, regards manufacturing as the foundation of the country. As of 2022, the four largest contributors to Singapore's GDP are manufacturing (21.6%), wholesale trade (18.6%), finance and insurance (13.5%), and transportation and warehousing (10.4%).
Roughly calculated, Singapore's manufacturing value added is 100 billion US dollars more than Hong Kong's. As mentioned earlier, the GDP gap between the two places is $107 billion.
In other words, the economic gap between Singapore and Hong Kong is mainly caused by the manufacturing industry.
In fact, historically, Hong Kong's industrial starting point was much higher than Singapore's.
At the end of the 40s of the 20th century, some mainland entrepreneurs transferred industrial equipment and capital to Hong Kong, which led to the development of Hong Kong's local manufacturing industry. At that time, Singapore was still an agricultural island through and through, and the outside of the port area was full of farmland.
In the sixties and seventies of the 20th century, the western developed countries represented by Europe and the United States began to transfer labor-intensive industries to Hong Kong, and Hong Kong became a first-class manufacturing base in Asia, giving birth to various "industrial kings", such as Li Ka-shing, the king of plastic flowers, and Tian Jiaping, the king of leather. At the same time, under the leadership of the Lee Kuan Yew government, Singapore has also initially established an industrial system.
The division appeared in the 1980s, when Hong Kong did subtraction and Singapore did addition. Due to the lower production costs and more effective investment promotion policies in the mainland, Hong Kong entrepreneurs have moved their factories to the Pearl River Delta.
At that time, Singapore was systematically upgrading its manufacturing industry, transitioning from the production of labor-intensive products to high-tech products.
By the 90s, Hong Kong's manufacturing industry had been hollowed out. Relevant data show that from 1991 to 1997, Hong Kong's stock price and house price appreciation totaled 7 trillion Hong Kong dollars, which is exactly equal to the total GDP of Hong Kong during these seven years.
At that time, Singapore's electronics industry had become the world's largest producer of disk drives and disk drive components.
Since the beginning of the new century, Hong Kong has been running blindfolded in the direction of "finance + real estate". Singapore, on the other hand, continues to promote the upgrading and transformation of its manufacturing industry, and eventually becomes a world-class science and technology innovation center.
In 2009, Lee Kuan Yew commented on Hong Kong real estate developers: "Have they made any products that market the world?
Emerging industries: Singapore has stepped on all the fronts
Integrated Circuits, Artificial Intelligence, Biomedicine, Precision Engineering, New Energy, New Materials...... But all the high-end industries we can think of, Singapore has a layout, and has achieved quite good results.
Singapore is the "chip capital". Singapore's semiconductor production currently accounts for 11% of the global semiconductor market. Singapore is home to more than 300 semiconductor companies, including multinational companies such as Texas Instruments, STMicroelectronics, Infineon, Micron, and GF.
GF fab manufacturing facility, Singapore
Singapore is the "Biomedical Capital". Four of the world's top 10 highest-yielding drugs are manufactured in Singapore. Singapore-made hearing aids account for about 30% of the global market share. Singapore is home to more than 50 pharmaceutical factories and more than 300 medical technology companies. Leading domestic pharmaceutical companies such as Sinopharm, Sinovac, GenScript and WuXi Biologics have also set up factories in Singapore.
In addition, Singapore, which does not produce a drop of oil, is actually the third largest oil refiner in the world. The refining and petrochemical industry is Singapore's pillar industry. In 2011, Singapore's petrochemical industry was worth US$77 billion, accounting for 34% of the country's GDP at that time.
The well-developed advanced manufacturing industry has also given a negative impetus to Singapore's science and education.
A science and engineering professor at a well-known university in Hong Kong told a reporter from Caijing
Universities in Hong Kong and Singapore generally do not accept their own graduates as professors, but only accept graduates from institutions that are one grade better than themselves. Twenty years ago, Hong Kong university graduates could go on to professorships in Singapore's universities, but now the situation is reversed. Graduates from Singapore universities can become professors in Hong Kong universities.
Hong Kong's strategy to break out
Singapore's industrial miracle has aroused infinite emotion among Hong Kong people.
In 1998, the Hong Kong government reflected on industrial development and initially reached a consensus on "shifting from processing and trade to high-tech high-tech services". Subsequently, the Hong Kong government and PCCW (the company of Li Ka-shing's son, Li Zekai) joined forces to launch the Cyberport project.
However, Hong Kong has just survived the Asian financial crisis, and the government does not have much surplus food in its hands, so it is difficult to "replenish blood" for Cyberport. What's worse is that Hong Kongers have changed the planning of Cyberport, 70% of the land has been built into residential buildings, and high-tech projects have become real estate projects.
Cyberport, Hong Kong
Hong Kong, which is overly reliant on real estate and finance, soon fell into a "strange circle": housing prices continue to rise, the gap between the rich and the poor is getting worse, the atmosphere of innovation and entrepreneurship is getting weaker and weaker, and the resentment of young people is getting heavier, which then leads to serious social problems.
Hong Kong has had to make changes. On April 29, 2022, Li Jiachao officially shouted the slogan "No Innovation, No Future".
In developing high-tech industries, Hong Kong is first faced with problems such as land shortage, shortage of qualified personnel, few enterprises, lagging technology, and insufficient funds.
In terms of land, Hong Kong wanted to follow Singapore's example and build public housing and modern industrial zones through large-scale land reclamation. However, due to the strong opposition of Hong Kong's environmental groups and the huge debt of the Hong Kong government, Hong Kong has had to suspend the reclamation plan.
But Hong Kong also has its own geographical advantages over Singapore – north of Hong Kong is the economically active and industrially developed Pearl River Delta. Therefore, Hong Kong is making use of Guangdong-Hong Kong co-operation platforms such as Qianhai in Shenzhen, Nansha in Guangzhou, and Shenzhen-Hong Kong Loop to solve the problem of the implementation of cutting-edge technologies.
In terms of talent, Hong Kong and Singapore are secretly competing with each other, and both have introduced residency policies for investors, professionals and young students.
At present, the two cities have reached a draw, with more investors going to Singapore and more professionals going to Hong Kong. In 2023, Hong Kong received about 200,000 settlement applications, more than 120,000 were approved, and about 70,000 people have arrived in Hong Kong.
In terms of enterprises, the Hong Kong government has changed its cold attitude and begun to join the "investment war".
Recently, the Hong Kong government set up a $10 billion "New Industry Acceleration Plan". According to the plan, the HKSAR Government will provide a subsidy of at least $100 million and a maximum of $200 million for each enterprise, and it is expected that the scale of the scheme of $10 billion can support up to 100 enterprises.
Nezha Automobile, which is mired in the crisis of losses and production cuts, took the lead in responding to the call of the Hong Kong government and announced that it would invest billions of yuan in Hong Kong to build an intelligent R&D center, a big data center and an automobile factory.
In return, the Hong Kong government promised to provide a subsidy of 200 million Hong Kong dollars for Nezha Automobile and assist in the investment of 200 million US dollars in the cornerstone round.
Although the investment amount is not very high, it shows the Hong Kong government's "love for the virtuous" and has the meaning of "a thousand dollars to buy horse bones". This sends a signal to entrepreneurs: an enterprise like Nezha, which has an annual revenue of only a few billion yuan and a cumulative loss of tens of billions of yuan, can get money from the Hong Kong government.
So far, Hong Kong's move has been quite effective: since 2023, Hong Kong has successfully introduced hundreds of innovative technology companies (including Huawei, JD.com, Meituan, and Lenovo) to settle down. The willingness of multinational companies to invest in Hong Kong has also increased.
In addition to land, talent and businesses, capital and technology are also important. However, there is no need to worry too much about Hong Kong, after all, Hong Kong is a first-class financial center and has several world-class universities (such as the University of Hong Kong, the Hong Kong University of Science and Technology, the Chinese University of Hong Kong, the City University of Hong Kong, and the Hong Kong Polytechnic University).
In fact, what Hong Kong lacks most is a spirit, a spirit of reverence for science, emphasis on research and development, pursuit of innovation, and courage to start a business. After the 2022 Hong Kong college entrance examination, 6 of the 8 "champions" chose to study medicine.
Lee Hsien Loong, who is about to resign as prime minister, also pointed out sharply: "The root of Hong Kong's problems is that young people have lost confidence in the future. ”
This is perhaps the primary issue facing Hong Kong.
本篇作者 | 饶祖分 | 责任编辑 | 何梦飞
主编 | 何梦飞 | 图源 | VCG