Lily Tan thought the pace of life in Singapore was pretty fast. But that was before she went abroad to work in the finance industry. First she stopped in Tokyo, Asia's undisputed financial hub. But then she moved to a city that claims the title of being No. 2 - Hong Kong.
After nine years living and working in the former British colony, Ms. Tan now says her hometown of Singapore probably has a way to go to supplant Hong Kong as a finance center. She finds the pace of life in Singapore to be, well, more leisurely than in Hong Kong. "Even the subway moves slower," she says.
Hong Kong and Singapore have long been rivals. But the region's economic crisis has ratcheted up the historic competition between these Asian city-states.
Both have prospered because of the energies and talents of their hardworking residents, not because of any natural riches. Both are overwhelmingly Chinese. But being former British colonies, they are English-friendly and have attracted an important segment of expatriate professionals.
Each has carved out its own special niche in the financial markets. Singapore surpasses Hong Kong in foreign-currency trading, with a daily turnover of about $100 billion. But Hong Kong bests Singapore in the number of investment funds.
Says a Hong Kong investment banker, "Singapore is still very much a regional financial center, while Hong Kong is a junior partner to New York, Tokyo, and London ... and if Tokyo doesn't do something about its financial system, Hong Kong may not be a junior partner much longer."
The current financial turmoil in Asia has hit both cities, but not nearly as hard as elsewhere in the region. In part, that is because both have a reputation for highly professional, incorruptible banking authorities. Moody's Investor's Services ranks three Singaporean banks as the strongest in Asia.
Another reason is that they both have learned hard lessons in the past. Hong Kong's stock exchange ignominiously suspended trading for four days in the wake of the October 1987 stock-market crash. Experts from the Bank of England were brought in to help restore confidence.
Singapore was embarrassed when a young securities trader named Nick Leeson managed to bankrupt the venerable British Barings Securities in 1995 by running up nearly a billion dollars worth of debts by trading in derivatives.
Still, there are important differences. In Hong Kong, laissez faire capitalism and nonintervention in the economy are practically a credo. It was seen as a significant departure when the government, certainly with one eye on Singapore, recently announced plans to build an expensive science park to foster high-tech industries.
By contrast, Singapore is closely managed by a paternalistic government, which involves itself in details of everyday life, down to banning the importation of chewing gum. The Singapore Monetary Authority lays down the law, and banks obey. Aware that some of its regulations are harming competitiveness, Singapore has of late moved to relax some restrictions on mutual funds in order to boost its competitiveness as a fund-management center.
The main difference between these cities lies in their markets, however. Traditionally, Singapore is oriented more toward Southeast Asia, while Hong Kong is the gateway for China. That gives Hong Kong an advantage for the time being since China's economy has suffered less from the Asian economic turndown than Southeast Asia's. "Hong Kong has a very lively backyard, while Singapore's has kind of died," says the investment banker.
Both have prospered, however, because they can exploit a vast and potentially rich hinterland without the burden of actually having to administer them or to deal with the problems of raising the living standards of enormous peasant populations.
In both cities, expatriates and other professionals are not only welcome but also are critical to their success. So certain other factors and intangibles come into play when a foreign company decides in which of the two cities to set up operations.
Singapore has a large advantage in lower costs and a reputation for being a much more livable city than Hong Kong. Lily Tan says she rents an apartment in a prime residential area for about a third of what she used to pay for a similar apartment in Hong Kong.
But for many, the deciding factor is not such lifestyle issues, but rather the kind of business one wants to do.