Sophia Haller

Sarah Lim Comparing between the economy of Hong Kong and Norway 15/03/2019

Comparing between the economy of Hong Kong and

Norway

Figure 1 Wikipedia. “Flag of Hong Kong.” Wikipedia, Wikimedia Foundation,

Figure 2 Wikipedia. “Flag of Norway.” Wikipedia, Wikimedia Foundation,

&

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Sarah Lim Comparing between the economy of Hong Kong and Norway 15/03/2019

Contents
Introduction ...................................................................................................................... 3
Norway ............................................................................................................................. 3
Introduction ............................................................................................................................. 3
General Facts ............................................................................................................................ 4
Human development ................................................................................................................. 6
2008 global financial crisis .......................................................................................................... 6
Global competitiveness .............................................................................................................. 6
Summary ................................................................................................................................. 6
Hong Kong ........................................................................................................................ 7
Introduction:............................................................................................................................. 7
Human Development ............................................................................................................... 8
Hong Kong and it’s GDP ............................................................................................................. 8
Import and Exports: ................................................................................................................. 11
Sanctions: ............................................................................................................................... 13
Key statistics: .......................................................................................................................... 13
The response of Hong Kong to the 2008 global financial crisis ...................................................... 14
Comparing ...................................................................................................................... 14
GDP and other key statistics ................................................................................................... 14
GDP composition by sector .................................................................................................... 16
Public debt and External dept................................................................................................. 16
Budget and Budget surplus..................................................................................................... 17
Human Development Index (HDI) and its key statistics ............................................................ 17
Population ............................................................................................................................. 18
Additional Information........................................................................................................... 18
Summary ............................................................................................................................... 18
Which economic system is better? ......................................................................................... 18
Work cited....................................................................................................................... 19
Norway .................................................................................................................................. 19
Hong Kong ............................................................................................................................. 20

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Introduction
Karl Marx and Sam Smith represented communism and capitalism and argued for their own system.
Today, all economies are mixed economies and they have elements of both the planned economy
and the free market economy. But which system is better? Neither of them is perfect and there are
no pure planned or free market economies in the world, but we can compare two countries by the
economic data available to find the better system. Hong Kong is closer to the free market economy.
It has received a high degree of autonomy by China to preserve its economic system. Norway is
closer to a planned economy and a constitutional monarchy, in which the King is the head of the
state, but often only has representative and ceremonial duties.

Norway

Introduction
Norway, a high-income country located in the north of Europe, has a total population of 5.3 million
people and has a mixed economy which is however closer to a planned economy than to a free
market economy. The country is not part of the EU, but part of the European economic area, which
gives Norway most of the single market rights, but very little ability to influence in EU decisions. The
currency is the Norwegian krone. Figure 3 shows the Location of Norway within Europe.

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Figure 3: Theeuro, Location Map of Norway within Europe

General Facts
In 2017, the GDP was $381.2B, the GDP growth was 1.7%, the GDP per capita was $72,100 and the
GNS was 34.3% of the GDP. There was 1.9% of inflation (cia). The Labour force was 2.797 million,
the unemployment rate was 4.2%, no people are living in poverty, the Budget was 217.1 billion for
revenues and 199.5 billion for expenditures, the Budget surplus was 4.4% of the GDP and 36.5% of
GDP was public debt. Norway exported $102.8 billion and imported $95.06 billion (CIA). Taxes
and other revenues make 54.7% of GDP. The industrial growth rate (which includes mining,
manufacturing and construction) is 1% and the external debt (which is the total public debt and
privet debt that is owed to non-residents and is repayable in international accepted currencies, gods
or services) was $642.3 billion in 2016 (indexmundi). Figure 4 shows the GDP composition, by sector
of origin. Agricultural products are barley, wheat, potatoes, pork, beef, veal, milk and fish and the
industrial growth rate was 1.5% in 2017. (CIA)

Figure 4: GDP composition, by sector of origin

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Trade
As the 36th largest export economy, Norway exported $106B in 2017. Its top exports are different
forms of petroleum, sourced from major oil reserves in the North Sea, fish and raw aluminium.
These products mainly go to the UK, Germany and Sweden. Norway also is the 35th largest importer.
The country imported $84.8B in 2017, however, imports have decreased at an average of 0.8% per
year and exports have decreased at an average of 7.4% per year during the last five years. The three
top imports are cars, iron structures and refined petroleum, which mostly come from Sweden,
Germany and China. Figure 5, 6, 7 and 8 show charts of the export products, the import products,
the import origins and the export destinations retrospectively. Norway’s trade balance of $21.2B in
net exports is positive. (CEO). However, since Norway relies so heavily petroleum and natural gases,
they are very sensitive to fluctuations in oil and gas prices. In addition, we don’t know how long the
exploitation of the oil reserves can go on. At some point there is nothing left.

Figure 5: Export products

Figure 6: import products

Figure 7: import origins

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Figure 8: export destinations

Human development
The Human development index of Norway is 0.953. The HDI is made up of different indicators,
including life expectancy (health), years of schooling (education) and other. The life expectancy is
82.3 years and 17.9 years of schooling are expected. The GNI per capita is $68,012, the Gender
development index is 0.991 and the employment to population ratio for 15 years and older is 61.5%.
The Homicide rate per 100,000 people is 0.5%, export and imports make 68.5% of the GDP, 97.3% of
the population uses the Internet and the carbon dioxide emissions per capita are 9.3 tons or 13 tons.
(HDR)

2008 global financial crisis

Because foreign trade is so critical to Norway’s economy and without a large domestic market, the
effect of the worldwide recession of the early 1980s had a big impact on the economy. Norway also
had a banking crisis in 1991-1931 (rethinking economics) which taught both the financial authorities
and the banking industry and minimised the impacts of the global financial crisis in 2008.
Economic growth picked up after only one year, while other countries felt a 10-year stagnation. The
global financial crisis was started by the collapse of the mortgage market in the US. While House
prices were increasing, it was easy to refinance, and millions of people obtained loans with interest
rates and no repayment. The mortgages were said to be a safe investment, but the banks were left
with the houses when the market turned around and millions abandoned their loans.

Global competitiveness
The restrictive immigration policy and the social welfare system, that taxes the small population very
high, restricts the global competitiveness of Norway. As mentioned earlier, Norway is closer to a
planned economy than to a free market economy. The Government controls most of the country’s
economy and invests in education, healthcare and agriculture. Norway’s government owns over 50%
of domestic businesses, employs 35% of workforce, ownership in manufacturing is 10%.

Summary
The economy of Norway is closer to a planned economy because the government makes many
decisions to influence the economy instead of letting the “invisible hand” deal with stuff. The
government taxes the population very high and makes it almost impossible for individuals to get
rich. This has a negative effect on the global competitiveness because the population does not have
much motivation to work hard. This is one disadvantage of communism. There is no motivation to
work hard and push the economy because it is almost impossible to get rich and the government
provides for those who do not earn enough money. This however is also an advantage of the
planned economy. Those who cannot supply for themselves, like the old and sick people, do not live
in poverty or do not have to put strain onto their family. The Norwegian government provides free

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healthcare and education for their citizens. The free education means that the government pays for
the school. Also, children, whose parents could not afford an education for them, have the
opportunity to have a better life.

Hong Kong

Introduction:

Figure 9 “Datei:Hong Kong on the Globe (Japan Centered).Svg.” Wikipedia, Wikimedia Foundation,

Hong Kong is the 101st largest country in the world. It covers 1,054 square kilometers and is located
in Asia. In Figure 9 you can see the rough location of Hong Kong on the globe. It is the 33th most
complex economy. (OEC) (ECI) Hong Kong has a population of 7.392 million people, calculated in the
year 2017. It is a free market economy, which depends on international trade and finance.

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Their currency is in US Dollars and it has a quite stable GDP rate. Hong Kong’s exports are estimated
to be at $540 billion per year and the imports are also estimated at $561.4 billion.

Hong Kong has a free market economy, which means that the prices of the goods and services in
Hong Kong are determined by the open market. It means that they are free from the intervention by
the government or any person that is above you.
A lot of people live in Hong Kong, and there’s enough money, in order for everyone to live a good
life. But this is completely wrong. The small country located in Asia suffers from poverty. Over 1.37
million people are struggling to live. Some people said that there is not a lot being done, so that
everyone in Hong Kong lives equally. (Chiu, Peace.) The Hong Kong Population below Poverty line was
at 19.6% in 2012. (indexmundi.) These were calculated by surveys that were done by subgroups.

Human Development

The Human Development Index of Hong Kong is 0.933, (“List of Countries by Human Development Index.” )
and had a positive change since the last year by 0.003. The life expectancy years that Hong Kong has
in total is 84,28 years. These means that Hong Kong has a good health care. In fact the health care is
the best in the world. It won over the Singapore, Japan and Norway health care and is the first in the
ranking list. The GNI per capita was seen to be 60090 PPP, the Gender Development Index is 0.965
and the expected years of schooling are 16.3 years. The unemployment rate for Hong Kong was 2.6%
in 2017 and in the year before, the unemployment rate was the same. This is good as the
unemployment rate did not raise in a year. The Employment to population ration for people of the
age 15 years and older is 58.5%. The Labor force in Hong Kong was high in 2017. It was estimated
that 3.965 million were in Labor force.

Hong Kong and it’s GDP

The Hong Kong Growth Domestic Product lies at around the 341. 45 billion US Dollar mark and is the
highest GDP. The lowest GDP rate that there was ever been was 1.32 Billion USD in 2017 (Trading
Economics.) The GDP consists of Agriculture, Construction, Manufacturing, Public Administration,
Services, Transport and Utilities. The Agricultural GDP in June of the year 2017 calculated that it was
430 million HKD, from construction 29412 million HKD, manufacturing 7140 million HKD and from
Public Administration the GDP was calculated to be 118396 million HKD. From Services the GDP is
607235 UKD Million, from Transport 40448 HKD Million and from Utilities it increased up to 9895
UKD Million. (Trading Economics.) The Growth National Savings of Hong Kong are 24.9% of the GDP in
2017, in 2016, 26.4% of the GDP and in the year before that 24.9%. (indexmundi.)
The GDP is also categorized into sectors. Agricultural, industry and services. The agricultural takes
0.1 % of the whole GDP, the industry 7.2% and the services the most: 92.7 %. (indexmundi.) This
was estimated in the year 2017. In the following Diagram labeled as Figure 10 shows the
percentages of the GDP in Agricultural, industry and services.

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Figure 10, shows the Agricultural, industry and services percentage that makes up the GDP.

The Gini Index of Hong Kong is 53.70. A Gini Index meaures the extent of distribution of income
from individuals or households in the Hong Kong economy deviates from a equal distribution. A Gini
Index of 0 is for perfect equality and the opposite is when the Index shows 100. Hong Kong is in the
middle, which means that it is both inequality and equality.

The overall public dept from the GDP was 43.6% in 2017 and 44.8% in 2016. (indexmundi.) These are
all the borrowings of the Hong Kong governments and the less repayments. In Figure 11 you can see
the general government growth debt of 2001 until 2014.
The external dept of Hong Kong is 13.05 trillion US Dollars.

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Figure 11 “World Economic Outlook Database.”

The Taxes and other revenues lied by 19.8% of the GDP in 2017. (indexmundi.) These taxes include
personal and incorporate income taxes.

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Import and Exports:
The main trading partners that Hong Kong has are the mainland China, USA, Taiwan, Japan,
Singapore, Korea, India and Thailand.

Figure 12 HKTDC Research. “Economic and Trade Information on Hong Kong.” Economic and Trade Information on
Hong Kong

The main origins, where Hong Kong gets their products, are China, Singapore, Other Asia, South
Korea and Japan. From China they buy their goods for $225B, Singapore $60.8B, Other Asia $40.8B,
South Korea $34.8B and Japan $32.1B. The top import countries are China, with 42% from all import
countries, Singapore (10%), Other Asia (6.7%) and South Korea 5.7%. The top imports that Hong
Kong has, are Integrated Circuits for $168B, Broadcasting Equipment for $45.4B, Gold for $35B and
office machine parts for $28.6B. The top imports are integrated Circuits which makes up 27.7% of all
import products and that is then followed by the Broadcasting Equipment that makes up 7.45%.
Hong Kong is known for being the 6th largest importer in the world. In the last five years imports have
increased an annualized rate of 4.8%. In 2012 the money they used to import products was $477B
and in 2017 $608B. Figure 12 shows the service trade value of imports and exports in US $ Billion
from 2012 until the past year of 2018. (OEC.) The trade balance is 2.20% and they are in negative
rates: -61.9 Billion US Dollars.

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Figure 13 HKTDC Research. “Economic and Trade Information on Hong Kong.” Economic and Trade Information on
Hong Kong

The goods that Hong Kong produces is exported to many different countries all around the world.
The top export destinations are China (12%), Thailand (9.2%), Other Asia (8.8%) and India (7.6%).
Some of the exports that Hong Kong produces are Gold (25.6B), Broadcasting Equipment ($45.4B),
Integrated Circuits ($7.53B), Diamonds ($5.4B) and Telephones ($3.79B). But the overall top Exports
are Gold, which makes up 18.8% of the overall exports and then closely followed by the
Broadcasting Equipment, which makes up 9.3% of the whole exports. The export of Hong Kong has
increased an annualized rate of 1 % of the last five years. (OEC.) This means that in 2012 the export
money that Hong Kong earned from their products were 130B and in 2017 the money increased by 6
Billion Dollars. Figure 13 informs us with the major export markets for Goods
Hong Kong imports much more than it exports and that is why Hong Kong spends more money tha n
it earns. This can lead to some serious problems, as they can fast get to negative numbers that they
need to pay off later. For example, in 2017 Hong Kong exported $136B and they imported $608B and
this resulted to a negative trade balance (OEC).

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Sanctions:
At this moment Hong Kong enforces UN sanctions against other 14 countries. These include
Afghanistan, Central African Republic, Cote d’lvoire, Democratic Republic of the Congo, Eritrea,
Guinea-Bissau, Iran, Iraq, Libya, North Korea, Somalia, South Sudan, Sudan and Yemen. (INCE)
Sanctions include the prohibition of certain sales like weapons and other specified good and
services. Some of the rules for some countries are the following: Supply, sale or transfer weapons or
other specific items/ luxury goods… Not following the rules when in Hong Kong, working, or acting,
there can be some serious consequences, such as penalty, or also having a high fine for money.

Key statistics:
The GDP growth rate in Hong Kong is currently by about -0.3%, when in the year 2017 it was at
3.8%. It decreased quickly. The GDP itself was calculated to be 341,4 Billion USD dollar in 2017. Hong
Kong produces and gets a lot of money but it seems like the country spends more than it can
actually earn. These also show the statement above and the GDP growth rate now, which are in
negative percentage.
The overall GDP that Hong Kong has lies in about US$ 340 billion.
The GDP per capita is 46. 193, 61 USD dollars. This is the overall GDP divided by the population in
Hong Kong. It is not as much compared to some other countries like Luxemburg or Switzerland. But
this is also because they have a much higher GDP or they have not much population in the country.
Inflation Rate: consumer prices: 2% (2017), 2.6% (2016) (indexmundi.)
Population: 7.39 million (end of 2017)
Visitors in the year 2017: 58.5 million people
Trade to GDP ratio in the year 2017: 309 percent
They are very open to the world, have a lot of trade, investment and tourism. (Ita.)
The US Exports that have been done from Hong Kong in 2019 have been calculated to be US$39.9
Billion.
As briefly mentioned above the main Trading Partners of Hong Kong are mainland China, the United
States, EU, Japan and at last India. (Ita.)

The Budget and their revenues are at about $66.19 Billion and the expenditures of Hong Kong was
at $62.86 billion in 2017. These numbers were calculated on an exchange rate basis. (indexmundi.)
The Budget surplus is by 2.20% of the GDP. This is not a lot, but still is a good saving so that it can be
used when it is needed.

The gross national income is $473.8 Billion KKP Dollar. It includes the investment profits that the
country makes, but it excludes the loans that were made with other countries and the incomes that
were made from foreign people that work in Hong Kong. It is the income from only the residence of
Hong Kong, the people that live there permanently.

The Gender Development Index is 0.965.

The main Key statistics of Hong Kong are the following:

 World class infrastructure
 Free flow of information
 No restrictions on inward or outward investments
 No foreign exchange controls
 No nationality restrictions on corporate or sectoral ownership
 Simple and low tax regime
 World financial hub

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The response of Hong Kong to the 2008 global financial crisis

The US financial crises became the global financial crisis and it had a huge impact on the Hong Kong
economy. The most effected was the financial part in Hong Kong. There were many differences,
increases and decreases in various things, such as the economy growth rate, property market,
exports and imports, the population of people in Hong Kong….
The economic growth rate has decreased rapidly from 6.4% in the previous year before the global
financial crisis in 2018, to 2.5% in 2018. (Sarah Y. TONG &, ZHANG Yang.) The last 7 years the economic
growth rate was increasing rapidly. The financial part of Hong Kong was hit very hard from the
financial crisis. There were challenges that were to be faced, as there were deadlines that could not
have been promised to finish at that time anymore. An Example is the international financial center
in Shanghai, that should have been done by 2020. Much more people were unemployed by the end
of 2008. The Unemployment rate was seen to be 5% in 2009 then the previous year, which was
3.3%. (Sarah Y. TONG &, ZHANG Yang.) Also, the exports also had a huge decrease.

The government was a good help, so that it could put the Hong Kong citizens back onto their feet.
The Financial Secretary announced two pre-emptive measures in October 2008. This is a measure
against something that is feared. The first one was to use the Exchange Fund to secure the
repayment of all deposits held with authorized institutions in Hong Kong. The second preemptive
measure was to establish the Contingent Bank Capital Facility so that there would be an additional
capital to local people in Hong Kong and their locally incorporated banks. (Yang, ZHANG.) These helped
to stable the financial business of Hong Kong for a while. They also announced that the government
promised to give more than 60,000 employment jobs opportunities in the year after the whole
financial crisis (2009). This would be done by expedition projects, recruiting civil servants, creating
temporary or other posts. (Yang, ZHANG.)

But after the global financial crisis in 2008, the economy of Hong Kong picked up after a while, and
found there halt.

But there was one economy crisis in 1998, which was called the Asian Financial Crisis. Also in this
crisis there were some severe damages and changes that were done. Like at the global financial
crisis in 2008, there was a negative growth rate. The unemployment rate was higher, even doubled,
then before. Poverty prices went up to 40% and share prices fell. (“Chief Executive's Statements.”)

Comparing

GDP and other key statistics

The GDP per capita is much higher in Norway than it is in Hong Kong, which means that the people in
Norway earn on average more money than the people in Hong Kong. Figure 14 shows the GDP of
Hong Kong and Norway and you can see the difference between these two GDPs.

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Figure 14, GDP of Hong Kong and Norway

As the GINI index shows, there also is 53.45% less of an inequality in income in Norway than in Hong
Kong. Norway is closer to a planned economy and the government taxes the population very high
and makes it almost impossible for individuals to get rich. The money is invested in the health care
and education of the citizens. This however doesn’t have a positive impact on the global
competitiveness of Norway. The GDP growth of Norway is 1.7%, while the GDP growth of Hong Kong
is 0.3% negative. This could be explained with Hong Kong's negative trade balance, which is –61.9
USD billion: They import more than they export. Norway on the other hand has a positive trade
balance of $21.2B in exports. Hong Kong’s inflation rate is also higher (2.4%) than Norway’s (1.9%). It
looks like communism achieves equality and stops the rich from getting richer more successful than
capitalism.

Hong Kong has a Gross National Income of $473.8 Billion KKP Dollar and has a difference of 138.2
Billion Dollar with the GNI of Norway ($335.6 Billion). The GNI measures the income of the country.
From the two countries Hong Kong has the higher income. It shows that the citizens of Hong Kong
earn more money than the residence of Norway.

The Labour force of Hong Kong (3.965 million) is almost the double of the Labour force in Norway
(2.797 million). This could be because there are also a little less population in Norway than in Hong
Kong. But still in Hong Kong the unemployment rate is at 2.6% and in Norway 4.2%. There is a steady
increase of the unemployment rate in Norway. More and more people get unemployed because
they can’t find a job or are not able to work because they are some of the people that are not
included in the Labour force calculation. Because Hong Kong is helping unemployed people with
projects and introduced the employment support, the unemployment rate does not rise at the
moment.

The Inflation rate of Hong Kong is 2.40% and for Norway 1.9%. They are both in the range that the
inflation rate is good. The Hong Kong Inflation rate is higher than the one in Norway, but still is in a
good range that the prices are not too high that people can’t afford them. Figure 15 shows the
Inflation rates from Hong Kong and Norway.

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Figure 15, Inflation Rate

GDP composition by sector

The GDP composition by sector is divided by three: agricultural, industry and services. For both
countries the highest rate of GDP is services. Hong Kong uses more then 90 percent for the service.
This shows that they care and spent a lot so that the service part is at its best, also for the tourists to
see when they come to visit. For the agriculture and industry they spent only a little bit of their GDP.
Norway only uses 64% for the services. Both countries use more % of the GDP for the industry than
for the agriculture. (Hong Kong: 7.2%, Norway: 33.7% (industry)) Agriculture: (Norway) 2.3%, (Hong
Kong) 0.1%. Norway also uses most of its GDP for the services, but also spends quite the amount for
the industry and the agriculture. This could be, because they want to have a rather equal split of the
GDP for each sector.

Public debt and External dept

The Public debt of Hong Kong is 43.9% of the GDP and for Norway it is 36.5% of the GDP. This means
that Hong Kong’s money is 43.9% owned by the government. And 36.5% of the money is owned by
government in Norway. That the government agency owns a lot of the GDP can be good and bad.
The good thing is that the more city problems that includes money can be solved by the
government.

For the External dept, Hong Kong has 13.05 trillion US Dollars and Norway has an external debt of
642.3 Billion US Dollars. Hong Kong is far more in debt than Norway. We also know that they import
much more than they export The money that was borrowed from the institutions or governments of
the other countries has to be paid back in a loan. The money borrowed can also be paid of in selling
and exporting the export goods and products to the country that lend the money to them. For Hong
Kong paying off the money that it lent will not take that long than for Norway, as it has a less
External debt than Norway.

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At the moment, Hong Kong is buying much more than it is selling (they have a negative trade
balance of minus $61.9B), which means that they are either going into debt or taking the money
from their Budget (or both). In Fact, Hong Kong has an external debt of 6649.4 HDK B. Norway
makes a lot of money by exporting petroleum from major oil reserves in the North Sea. The
domination of petroleum in the market however causes Norway to be very sensitive to fluctuations
in oil and gas prices. Hong Kong’s economy apparently does not have any particular weakness

Budget and Budget surplus

The Budget for revenues of Hong Kong are $66.19 Billion and for Norway 217.1 Billion. The
differences between the two budgets is big (150.91 Billion). For expenditures Hong Kong has a
budget of 62.86 Billion US Dollars and Norway 199.5 Billion US Dollars. Hong Kong seems to look
after that they do not spend too much on their revenues and expenditures and save the money for
another use. For Norway it seems like they spent a lot of their money on the revenues and
expenditures, but still have enough money so that the other things that needs to be ensured with
money is still affordable. Norway spends the money on the healthcare and education of their
population. They also invest a lot of money into agriculture.

Budget surplus, also known as the term savings, for the countries are shown in percentage that are
from the GDP. Hong Kong has a low saving, which is 2.20% of the GDP. Norway has a little higher
saving of 4.4% of the GDP. When there would be a situation where the saving would be needed to
be used, Norway can use more money than Hong Kong, because they have much more of the
savings.

Human Development Index (HDI) and its key statistics

The Human Development Index (HDI) of both countries has a difference of 0.02. Norway has a
slightly higher HDI (0.953) than Hong Kong (0.933) overall achievement in its social and economic
dimensions. The life expectancy for Hong Kong is slightly higher than the life expectancy rate for
Norway. This could maybe be that Hong Kong has a better health care. In Norway the health care is
managed by the Norway government and the costs are not very low. Although the healthcare in
Norway is quite good, Hong Kong has beaten Norway, Singapore and Japan (some of the very good
health care) in their healthcare. On rate, Hong Kong is the very first on the list of the Economy
Health Care efficiency. In the past few years Hong Kong Invested more in the healthcare then before.
Most of the Hong Kong residence are following a very healthy lifestyle, which after a while also gives
a higher health rate. Another reason why Hong Kong has such a high health rate, is because Hong
Kong has an affordable and good health care provider. As we can see in the Table above, the
Electricity consumption per capita within a year is very unbalanced between the two countries.
Norway has a far more Electricity consumption. The difference lies at 17,27 KwH. Hong Kong has an
electricity consumption of 6, 215 KWh and with that is more than the half of the consumption that
Norway has on Electricity. Norway has a rate of 23,485kWh. Hong Kong has the lower electricity
consumption and does not only save a lot of money but also looks after the environment. Norway
needs to pay more for the electricity usage of the residence.

The GDI or the Gender Development Index is higher for Hong Kong (0.965) than for Norway (0.953).

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Hong Kong has a Gross National Income of $473.8 Billion KKP Dollar and has a difference of 138.2
Billion Dollar with the GNI of Norway ($335.6 Billion). The GNI measures the income of the country.
From the two countries Hong Kong has the higher income. It shows that the citizens of Hong Kong
earn more money than the residence of Norway.

Population
The population in Hong Kong is 7.39 million and Norway has a population of about 5.3 million
people. This is unusual, as Norway the double of the surface that Hong Kong has. A lot of people
moved to Hong Kong because of fears of the attacks and wars going on especially in China. That is
why the population increased so fast since the 18 and 19 hundred. For the size of Norway, it has a
very limited population. This could have many reasons, for example that not so many people like to
live in Norway and rather go there on some vacations.

Additional Information
Although the homicide rate in both countries is the same, Hong Kong imprisons 114 in every
100,000 people, while Norway imprisons only 75. This data however does not necessarily mean that
the people in Hong Kong commit more crimes. It could also mean that Hong Kong’s laws are stricter
than those in Norway and imprison people faster when they commit a crime. It could also mean that
the police in Hong Kong captures more criminals. But if Norway does have less criminals, it could be
the result of the high rate of equality in this county.

Summary
In summary, it looks like Norway’s economy is slightly better than Hong Kong's economy. They have
a higher GDP, higher GDP per capita, higher GDP growth rate and less external debt. They also have
a slightly higher rating in the human development index and have a better trade balance. Their
Budget and Budget surplus almost doubles Hong Kong’s Budget and Budget surplus. The public and
external debt is lower than Hong Kong’s and there is less inequality in income. Hong Kong on the
other hand has a lower unemployment rate and less electricity consumption than Norway. They also
consume less oil and are expected to live on average two years longer than somebody living in
Norway.

Which economic system is better?

While Norway is closer to a planned economy and provides free healthcare and education for the
population, Hong Kong is closer to the free market economy and lets the “invisible hand” control the
economy. But which system is better? Communism and Capitalism both have significant advantages
and disadvantages. The Communism economy provides for the population and keeps the GINI index
as low as possible. Most people earn the same amount and have a similar living standard. Although
this system ensures no big inequality, it has some disadvantages. The population does not have any
motivation to work hard because they cannot get rich or extremely poor. This is totally different in a
capitalism system. Here, everybody must work hard to ensure their survival. There is great
motivation for all people of different levels of income. However, there is great inequality. The rich
get richer and richer without anything stopping them and the poor people possibly cannot afford for
their own healthcare or an education for their children. The children that do not get educated don’t
have the possibility to have a better life. Since Hong Kong is not an entirely capitalism economy, the
Government does provide for a nine-year education. Since both systems have their advantages and
disadvantages, we cannot say, which economic system is better. However, the middle path is

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Sarah Lim Comparing between the economy of Hong Kong and Norway 15/03/2019
probably best because that is, what all economies have today: A mixed economy that has elements
of both the planned economy and the free market economy.

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