Two topics prompt impassioned discussion over inflation at expat dinner parties in Singapore at the moment: how much your rent has increased and Taylor Swift.
The first is met with a round of commiseration or begrudging congratulations, depending on whether you are closer to 100 per cent (most people) or a mere 20 per cent (a lucky few). The second sets off fierce debate on a favourite subject: the merits of Singapore versus Hong Kong.
Swift, like Harry Styles and Coldplay, is performing in Singapore but skipping Hong Kong for next year’s international tour. The American pop star — who performed in the Chinese special administrative region on a 2011 tour — is holding six concerts in Singapore, a city-state of over 5mn people. This is more than for Sydney, Tokyo or Mexico City.
The reasons for Hong Kong’s snub are unclear. Social media is blaming everything from the national security law to the lack of suitable venues. Whatever the reason, these musical choices and rising rents are both indicative of the diverging fortunes of the two cities — at least in the short term.
Hong Kong and Singapore have for years competed for leading financial hub status. But strict pandemic lockdowns, draconian national security legalisation and worsening US-China relations have dulled Hong Kong’s appeal, while Singapore’s low taxes, stable rule of law, and neutrality has made it more enticing for businesses and tourists. Singapore’s total employment numbers now outstrip those in Hong Kong, despite the latter’s larger population.
But Singapore is dealing with the flip side of that boon: spiralling costs and a limited ability to manage them. “If two Beyoncé concerts apparently caused high inflation in Sweden, what will six Taylor Swift concerts do to Singapore?” grumbled one investment banker based in the city-state to me this week. He has two daughters desperate for VIP tickets.
Even before tickets went on sale, prices for hotels and flights to Singapore were already soaring for March 2 to March 9 2024, when Swift is due to perform. Some three- and four-star hotels are 20 per cent more expensive compared with the week before, while flights from other cities in south-east Asia to Singapore are almost triple the normal price range.
Facing demands for ad hoc school holidays while Swift is in town, Singapore’s education minister, Chan Chun Sing, said on Facebook that granting time off “may further fuel inflation”.
While Hong Kong outpaced Singapore on inflation for most of the 1980s and 1990s, the roles have been reversed. Over the past two years, Singapore’s inflation has been consistently higher than that of its rival. An influx of new residents coupled with delays on new building during the pandemic have pushed rents to record levels. Singapore usurped New York as the city with the highest rental growth at the end of last year, according to Knight Frank, a real estate group.
Tiny Singapore can’t compete with other parts of south-east Asia for natural tourist attractions such as beaches or mountains, so it relies heavily on its appeal as a gastronomic hub. But even its lively restaurant scene is grappling with high commercial property rents that are defying a slowdown in other capitals. The manager of my favourite local Italian restaurant is moving to a different, more distant neighbourhood after the landlord doubled his rent.
Whatever the downsides for residents, the healthy rivalry with Hong Kong is a good thing. Competition keeps both cities innovating, launching new financial products and tax incentives to lure business and capital. Hong Kong, determined to recover some of what it has lost, is already attempting to coax back companies, professionals and family offices.
Some friends who moved over from Hong Kong during the pandemic are moving back, though Taylor Swift may make them regret that decision. One, a lawyer with two kids, said she made the decision after her rent was raised by 120 per cent. But she left last week with one request: “I might need a place to stay if I get Taylor Swift tickets. The hotels are too expensive.”