Bloomberg Rankings measured 160 markets on a scale of zero to 100 percent based on six factors. These are the costs of setting up business, hiring and moving goods; the degree of economic integration; less tangible costs such as inflation and corruption; and the readiness of the local consumer base, a category that includes the size of the middle class, household consumption and gross domestic product per person.

Hong Kong scored 49 percent, eclipsing the Netherlands' 48.3 percent and the U.S.'s 46.9 percent. Of the top 50, Germany was the leader on the basis of cost of doing business, moving goods and less tangible costs, while the readiness of the local consumers was deemed best in the United Arab Emirates. The price of labor and materials was lowest in Montenegro and the Netherlands was deemed best for setting up a business.

Brazil came bottom of the top 50 with 35.5 percent, undershooting India at 35.9 percent and Russia at 36.1 percent.

Hong Kong's reputation for rule of law and corruption-free administration has helped distinguish the city from mainland China. Its links to the world's fastest-growing major economy have plus points by allowing it to serve as center for the international use of the yuan, and last August China further relaxed limits on investment flows.

Hong Kong charges a corporate tax rate of 16.5 percent compared with the U.S.'s 35 percent. The prospect of tougher regulations on the financial industry elsewhere has increased pressure on banks from investors to weigh a move there.

GE Decision

When General Electric was looking to open headquarters for its global growth and operations team outside the U.S., it chose Hong Kong for its proximity to important emerging markets, quality of life and infrastructure, according to Michael A. Jones, executive vice president of business development, global growth and operations.

“Hong Kong is one of the best places in terms of transportation and logistics,” Jones said in a telephone interview. “The ability to be in a vibrant international city was pretty important.”

The city still faces challenges. It is home to Asia's largest wage gap, and less than 25 percent of the land is developed, forcing up property prices and discontent among lower-paid locals.

The Netherlands ran second, reflecting the appeal of an economy with five major ports and easy access to mainland Europe. Companies based there include Royal Philips Electronics NV, the largest light-bulb maker, and ASML NV, which has an 80 percent market share in the semiconductor equipment market.

The U.S., the world's largest economy, came third. President Barack Obama released a business-tax overhaul proposal on Feb. 22 that would reduce the corporate rate to 28 percent and eliminate tax breaks.

Regionally, Chile was ranked the best place to do business in Latin America, while the U.A.E. was top in the Middle East and Africa. Poland had the highest score in emerging Europe.

The World Bank ranks Singapore and Hong Kong top in its gauge focused on the ease of doing business. The Washington-based Heritage Foundation has named Hong Kong the world's freest economy for 18 successive years.

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