Singapore pips Hong Kong as most globalised city

Ernst & Young Globalization Index 2009 also finds globalisation slowing.

In cooperation with the Economist Intelligence Unit (EIU), Ernst & Young has released Redrawing the map: globalization and the changing world of business and named Singapore as the top country among 60 on the Globalization Index 2009. Failing to grab the coveted spot are Hong Kong SAR and Ireland which came in second and third respectively.

The Globalization Index, one of the three sources of original research in the report, covers the period from 1995 to 2013 and measures the countries' openness to trade, capital movements, exchange of technology and ideas, labor movements and cultural integration. The index does not measure the absolute or relative impact a country has on global commerce or the global economy but instead ascertains the country's relative level of global engagement. The Globalization Index measures 60 countries according to their degree of globalisation relative to their GDP.

Ernst & Young LLP Country Managing Partner Steven Phan said, "Generally, smaller countries that rely heavily on exports and world trade appear at the top. Singapore has further distinguished itself by being top scorer for the trade category, and excelling across all the other criteria. This top ranking is a reflection of Singapore's long-standing commitment to operate a free and open economy, underpinned by its dual-pronged strategy of attracting foreign investments and talents, and enabling our local enterprises and workforce to grow and internationalise."

Another significant finding of the report is the sluggish pace globalisation has taken since 2007. After reaching its peak of 4.12, the scores for the average annual overall level of globalisation dropped in 2008 by around 0.1 points and fell further by 0.4 points last year. Although economic recovery is underway in 2010, the pace of globalisation growth is expected to be at a slower pace in comparison to that of the last ten years.

Phan commented, "The halt to the globalisation trend is unsurprising – it's a reflection of the global financial and economic crisis, which had resulted in a dramatic reduction in international capital flows and volume of world trade. 2010 will be a transition year where we expect some modest economic recovery before markets fully stabilise to achieve some semblance of pre-crisis days."