Hong Kong and Singapore are the top two most investor-friendly economies in the Asia Pacific underpinned by effective governments, “generous tax breaks” and openness to trade, according to a survey conducted by Singapore-based consulting firm Vriens & Partners Pte.
Hong Kong takes the top spot and Singapore ranks second among 18 regional economies covered by the firm’s Good Governance for International Business – Asia Pacific 2010 report.
The poll asked 100 executives from telecommunications, oil and gas, mining and consumer goods companies to judge the markets in the areas of openness to international trade and business, rule of law, taxation, public sector quality and effectiveness, corruption and fiscal and monetary administration.
“We see companies and governments are often miles apart and don’t necessarily talk to each other, except in Singapore and Hong Kong,” said Managing Partner Hans Vriens. “There is a correlation between openness, success and GDP per capita.”
The survey centres on Southeast Asia, where Singapore is set to surpass Malaysia as the region’s largest economy this year after Indonesia and Thailand.
Singapore’s gross domestic product (GDP) may rise 15 percent to around $277 billion this year, while Malaysia may expand 7 percent to $270 billion, government estimates show.
In addition, foreign direct investment in both Singapore and Malaysia may pick up with the conclusion of free trade talks in the next two years with the European Union, said Vriens & Partners.