1. Comparing Singapore & Hong Kong

2. Singapore & Hong Kong Area Population Singapore: 697 km2
Hong Kong: 1,108 km2
Population
Singapore: 5.7 million
annual growth 1.9%
Hong Kong: 7.1 million
annual growth 0.4%

4. Singapore and Hong Kong
Each is separated from the mainland by a narrow waterway
Singapore’s relationship with Malaysia has been volatile
brief merge in
disputes about water delivery, islands, etc.
Hong Kong benefits from mainland China’s cheap labor and market

5. Singapore and Hong Kong
Both are mostly ethnic Chinese societies
Singapore: 77%
Hong Kong: 94%
both had over 100 years of British rule
Singapore:
Hong Kong:
both were occupied by Japan

6. GDP (purchasing power parity)
Singapore:
US$445 billion (2014)
Ranked 40th in the world
per capita 7th in the world
Hong Kong:
US$401 billion (2014)
Ranked 45th in the world
per capita 17th in the world

8. Singapore and Hong Kong
Both are newly industrialized economies
GDP composition:
Sector Singapore Hong Kong
agriculture 0% 0%
industry 25% 7%
service 75% 93%

9. Singapore and Hong Kong
Exports:
Singapore: 13th in the world
Hong Kong: 8th in the world
54% to mainland China
Imports:
Singapore: 14th in the world
Hong Kong: 7th in the world
47% from mainland China

10. Exports of G.&S. (% of GDP)

11. Economic development Singapore and Hong Kong
have achieved similar economic success
through very different economic approaches
path of economic development diverged after World War II
similar experience under British colonial rule
divergent political development after WWII
divergent economic models after 1960s

12. Colonial legacies Both became entry ports to mainland
both benefited from British management and technological expertise
both attracted inflow of Chinese emigrants
Chinese population in Singapore doubled in 1820s
Chinese population in Hong Kong quadrupled between the two World Wars

13. Divergent paths after WWII
Singapore gained independence (1959)
Lee Kuan Yew’s People’s Action Party
economy grew at a slow pace in 1950s
still based on intermediary trade
boosted by the Korean War of

14. Divergent paths after WWII
Hong Kong restructured its economy
population quadrupled
large-scale relocation of capital, entrepreneurs, and assets from mainland China
trade embargo against mainland China after Korean War broke out actually benefited HK
relative political stability
popular political apathy

15. Divergent development model
Singapore’s People’s Action Party
faced severe internal and external conflicts in 1960s
PAP became a elitist and paternalistic party
neo-Confucianism?
government intervention in the economy
drew up a state development plan

16. Singapore’s development 1960s
New institutions
Economic Development Board
promote industrial development
Housing and Development Board
develop industrial estates
Development Bank of Singapore
provide industrial financing
Jurong Town Corporation
acquire, develop, and manage development sites

17. Singapore’s development 1960s
Restructured from trading port to manufacturing base
government intervention to attract foreign investment
in labor market
in providing public housing
in improving educational facilities
in developing a social security system

18. Singapore’s development 1960s
produced phenomenal economic growth
achieved full employment by early 1970s
ventured into high-tech, capital-intensive industries and high value-added services

19. Hong Kong’s development
Hong Kong also enjoyed phenomenal economic success
rapid expansion in manufacturing in 1960s
industrial diversification in 1970s

20. Hong Kong’s development
government’s laissez-faire principle
reactive, selective, & reluctant intervention
development of public housing
provide lower-middle-income families with access to home ownership
social expenditure & community development
development of human resources
intervention to maintain competitiveness

21. Convergence since 1980s?
Singapore reconsidered its development strategy
economy diversified from manufacturing to financial and professional services
aims to surpass Hong Kong as an international center of finance & business HQ
government relaxed intervention in economy
free capital flows and foreign investment even after Asian Financial Crisis of 1997

22. Convergence since 1980s?
Hong Kong government moved in the opposite direction
became more interventionist
to cope with the political uncertainty during the negotiations between PRC and UK
intervened in stock and currency market
has linked HK$ to US$ since 1983

23. Convergence after crisis?