Last week, the International Institute for Management Development Business School issued its World Competitiveness Yearbook 2025. Hong Kong’s global competitiveness rose to third place globally from fifth place in the previous year, while our neighbor, Singapore, fell one place to second. To my surprise, Singapore’s “government efficiency” ranking was third, lower than Hong Kong’s. On closer look, under “government efficiency”, Hong Kong ranks first in tax policy, much higher than Singapore’s 15th. Hong Kong also ranks first in “business legislation”, just beating Singapore’s second-place position.

I know why Hong Kong’s tax policy ranking is so high. Hong Kong has no sales tax and our top marginal salary tax rate is 17 percent. Singapore has a goods and services tax and its top marginal salary tax rate is 24 percent. But does this necessarily imply Hong Kong’s government is more efficient?  I do not think so. Hong Kong has many things to learn from Singapore to improve its government efficiency. Government efficiency has many dimensions. In fact, as per the IMD report, Hong Kong falls short in public finance (sixth to Singapore’s fourth) institutional framework (10th compared to second) and societal framework (30th compared to  Singapore’s 12th ).  

The world’s interest in global competitiveness rankings may suggest that the economies of the world are competing for supremacy. I noticed that a Wall Street Journal article had this shocking title: We Can’t Beat Beijing if We’re Dependent on It. It sounds like we are all playing American football, just trying to beat our rivals. In reality, each country should just do its best to serve its people, while the larger economies that have greater ability should shoulder more responsibility to help the poorer countries and the cause of sustainable development. We trade with and invest in each other’s countries. Economics teaches us that such trade and investments will be mutually beneficial.  

Economists have long learned that the market serves humans well. However, governments need to address market failures while admitting that government failures can also happen. So while addressing market failures governments need to be wary of their misjudgments. China’s famous leader and an architect of China’s modernization and “one country, two systems”, Deng Xiaoping, advised that China must be humble and tackle challenges like “crossing the river by feeling the stones under the water apprehensively”. Policymakers are human. Mistakes are inevitable. So we must never be arrogant, and we must learn from our mistakes. Governments must know their place and be prepared for challenges, and must let science guide their policies. In 2004, then-president Hu Jintao proposed the Scientific Outlook on Development, which puts people first and seeks comprehensive, coordinated, and sustainable development. This was written into the Constitution of the Communist Party of China at the 17th Party Congress in October 2007.   

Today China has embraced science and the laws of the market. Its ideology is to serve the people and to serve the world. Today, the US is mired in an ideological struggle between “capitalism” and its imagined “communist rival”. Pray that governments of the world, regardless of the country, will focus on doing their best to serve their people and humanity

My China Daily article titled China’s Governance Ensures Plan Execution, published on June 11, began with an observation that China’s economy is the world’s most resilient. It is a statement of fact. China just wanted to do the best it can. Against all odds, it has delivered. An example of our self-correction is that China has tamed its excessively speculative property market in the last few years, and adjusted its possible excesses by changing policies. Another example is that recently the authorities have issued warnings against cutthroat price competition. Interestingly, excessive competition is not just in the electric vehicle industry or clean energy, both of which are often described as having been hit by “overcapacity”. The warnings apply equally to the food delivery industry, which has nothing to do with excess capacity. Excessive competition is indeed a concern.   

While excessive competition can be a problem, China has always preferred openness and fair play. I had for a long time thought that the United States, which has the world’s most winners of the Nobel Memorial Prize in Economic Sciences, would naturally champion free trade and openness. As early as 1942, Joseph Schumpeter proposed the idea of “creative destruction”, which is made possible by innovations that are in turn a result of competitive markets. It is ironic that the US today has turned protectionist.

I am very happy that China embraces multilateralism and has hosted so many expos in different areas. I have made a note of all such expos or fairs hosted by China over the years. Here is a list: the China International Fair for Trade in Services; Shanghai International Carbon Neutrality Expo in Technologies, Products, and Achievements (third, Shanghai); the World Manufacturing Convention (in Hefei since 2018); the China International Import Expo (eighth, held in Shanghai in November 2025); the China-CEEC (Central and Eastern European Countries) Expo and International Consumer Goods Fair (fourth, Ningbo); the China International Consumer Products Expo (fifth, Haikou); the China International Supply Chain Expo (third year, Beijing); and the China Beijing International High-Tech Expo (27th, Beijing); among others. 

Before China kicked off its reform and opening-up process, it was mired in an ideological struggle between the socialist road versus the capitalist road. Today China has embraced science and the laws of the market. Its ideology is to serve the people and to serve the world. Today, the US is mired in an ideological struggle between “capitalism” and its imagined “communist rival”. Pray that governments of the world, regardless of the country, will focus on doing their best to serve their people and humanity.

The author is an honorary research fellow at Pan Sutong Shanghai-Hong Kong Economic Policy Research Institute, Lingnan University, and an adjunct professor at the Academy for Applied Policy Studies and Education Futures, Education University of Hong Kong.

The views do not necessarily reflect those of China Daily.