MUMBAI: Hong Kong has ascended to the third spot in the world’s most competitive economies, according to the World Competitiveness Yearbook 2025 (WCY 2025) published by the Swiss-based International Institute for Management Development (IMD). This marks the second consecutive year the city has climbed two places, reaching its highest ranking since 2019 among the 69 assessed economies.
The IMD report highlights Hong Kong’s gains across all four key factors of competitiveness: “government efficiency” (second), “business efficiency” (second), “economic performance” (sixth), and “infrastructure” (seventh). This broad-based improvement underscores Hong Kong’s effective strategy in attracting private sector investment.
Chief executive John Lee affirmed the positive trajectory, stating, “The World Competitiveness Yearbook shows that Hong Kong’s scores in overall terms and in many areas have improved, indicating that the Hong Kong Special Administrative Region (HKSAR) Government’s policy directions are on the right course and that various policies have yielded results.” Hong Kong has consistently ranked among the top 10 globally for over two decades, since the WCY 2003.
Lee further emphasised the city’s “world-class business environment,” citing the rule of law, independent judiciary, a simple and low-tax regime, efficient markets, a robust financial system, and the free flow of capital, information, goods, and talent as key strengths recognised by the business community.
Despite global economic uncertainties and geopolitical turbulence, Hong Kong recorded solid year-on-year GDP growth of 3.1 per cent in the first quarter of 2025, with full-year GDP growth anticipated to be between 2 per cent and 3 per cent.
The city saw a record 145,053 new local companies registered under the Companies Ordinance last year, bringing the total to an unprecedented 1,460,494 by the end of 2024. Additionally, 1,079 new non-Hong Kong companies were registered, pushing that total to an all-time high of 15,126.
Lee reiterated Hong Kong’s unique “one country, two systems” advantages, positioning it as a “super-connector” and “super value-adder.” He affirmed the government’s commitment to strengthening international exchanges, expanding regional trade, and exploring new markets to foster a vibrant economy and improve livelihoods.
To further bolster its appeal, the government recently launched new legislation for company re-domiciliation, providing a streamlined mechanism for companies to relocate to Hong Kong. Already, two major insurance companies, AXA Hong Kong and Macau and Manulife (International) Limited, have announced plans to re-domicile under the new regime, pending regulatory approvals.
Hong Kong is actively pursuing reforms to solidify its standing as an international financial, trade, and shipping hub. The Office for Attracting Strategic Enterprises has successfully drawn over 80 strategic enterprises, projected to bring in HK$50 billion in investments and create more than 20,000 jobs.
Among the WCY 2025 sub-factors, Hong Kong secured top positions in “tax policy” and “business legislation,” and ranked second in “education,” “international investment,” and “finance.”
As a top-three global financial centre, Hong Kong’s stock exchange remains a vital indicator of market performance. By May 30, 2025, stock market capitalisation had surged by 24 per cent year-on-year to over $5.2 trillion. The Hong Kong Stock Exchange has also emerged as a leader among major global exchanges in initial public offerings (IPOs), with total funds raised nearing HK$79 billion ($10.12 billion) so far this year.