Hong Kong's competitiveness score is still ahead that of Shanghai in 2005 with an even wider gap, a research report said Tuesday.

The Hong Kong-Shanghai Metropolis (International City) Competitiveness study, co-conducted by the Better Hong Kong Foundation, Faculty of Business Administration of The Chinese University of Hong Kong and Shanghai Academy of Social Sciences, has been released annually since 2001.

Based on the Pyramid of Metropolis (International City) Competitiveness using a 32-item structural questionnaire, the 2005 survey interviewed 248 Chief Executive Officers from local and multinational corporations both in Hong Kong and Shanghai. They are requested to give a score from 5 (best) to 1 (worst) on each of the 32 measuring items for both Hong Kong and Shanghai.

According to the survey, Hong Kong's competitiveness score is still ahead that of shanghai in 2005 by almost one point (0.9), a consistent behavior observed during the past four years.

Hong Kong's score increased from 3.7 in 2001 to 4.1 in 2005 representing an increase of 0.4 (or 10 percent) and that of Shanghai 3.0 to 3.2 representing an increase of 0.2 (or 7 percent) for the same period.

Compared with 2004, Hong Kong gained modestly by 0.1 from 4.0 to 4.1 and on the contrary Shanghai's score dropped modestly by 0.1 from 3.3 to 3.2.

Relative to 2004, Hong Kong's score for sustainable economic growth continuously improved to exceed that of Shanghai by 0.8. In 2004, the difference is only 0.5.

In 2005, the investment environment of Hong Kong still recorded as the most significant competitive dimension to exceed Shanghai by more than one point (1.2), which is true during the past four years.

A widening gap of competitiveness in image of globalization between Hong Kong and Shanghai persisted in 2005. The difference in score is 0.8 in 2005 when compared with 0.5 in 2004.

By 32 items, Hong Kong is ahead of Shanghai by 31 items except a tie score obtained for macroeconomic structure.

Chyau Tuan, professor of Faculty of Business Administration of The Chinese University of Hong Kong, said it is largely a result of a much better-improved economic environment in Hong Kong since last year.

As the Closer Economic Partnership Arrangement enters into its third phase, Hong Kong enjoys more business opportunities. Such policies not only enhanced the international competitiveness of Hong Kong in general, but also strengthened further its position as a metropolis and leading role in the economic development of the region.

Zuo Xuejin, Vice President of Shanghai Academy of Social Sciences, said the result of the survey is reliable though it appears a surprise to some people.

"Shanghai is developing fast in hardware but lags behind in software, where rests a huge gap between Shanghai and Hong Kong," he said.

During the eleventh five-year program (2006-2010), Shanghai will readjust its industry structure as Hong Kong conducted 20 years ago, from labor-intensive mode to modern service-oriented type, paying more attention to finance, shipping, communication and culture, Zuo said.

"During the structure-transforming, Shanghai should learn from Hong Kong to build up a entrepreneur team who are flexible to changing circumstances," he added.

Tuan believed there exists absolutely no concern regarding the marginalization of Hong Kong even though confronted with competition from Shanghai because China needs multiple metropolis in considering the sheer size of the country. Both cities have the natural geographical locations at south and east China, where they can play unique and dominant roles there.