Has HK beaten Singapore due to foreign labour uproar?
Singaporeans noisy disapproval of foreign workers within their midst could have cost the country in its race to competitiveness against Hong Kong, with the former British territory now under Chinese rule, emerging as a clear winner.
The simple fact is Hong Kong is rising on world rankings for competitiveness knocking the US off the No 1 list, while Singapore slides from third, to fourth.
This is based on IMD, a Swiss business school, that defines competitiveness as the ability of a country to create an environment in which businesses can generate sustainable value.
Both Hong Kong and Singapore boast low taxes, good infrastructure and easy procedures to open a business, so why the divergence in competitiveness, asked Bloomberg.
One of the reasons is Singapore’s weakening economy as exports in the trade-reliant nation have come under pressure. But another key factor may be Singapore’s stricter rules on hiring foreign labor, which adds to business costs.
The ruling People’s Action Party (PAP) took steps to stem the flow of foreign labour in the country, following massive discontent among locals, who felt foreign workers were invasive and disruptive. Could that be the reason for the nation’s downfall in competitiveness?
The index flags Hong Kong’s labor market as more competitive than in Singapore, with the China-controlled territory improving from 2015 on scores such as working hours, skill levels, unemployment legislation and immigration levels.
Hong Kong also leads Singapore on business efficiency, including productivity and management practices, according to IMD.
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