For many years now, Singapore has been a leading country of choice when it comes to doing business internationally. Factors like the abundance of skilled resources, efficient and open economy and stringent intellectual property rights protection make doing business in Singapore so coveted. In fact, in 2016, for the tenth consecutive year, Singapore was ranked as the best country for doing business.
If you are considering the expansion of your business into international markets, Singapore might be the perfect destination for you. Find out more about what makes Singapore so attractive in the remainder of this article.
What is the main advantage of doing business in Singapore?
The primary benefit of doing business in Singapore is the fact that running a business there is easy and hassle-free compared to many other countries. This is due to factors like a robust and open economy, reasonable tax rates, outstanding infrastructure, the availability of a skilled workforce, and its strategic location in Asia.
Top reasons why doing business in Singapore is beneficial
As mentioned, there are several factors that contribute to the ease of carrying out business in Singapore.
1. A robust economy and no currency control
Singapore not only has a successful free-market economy but it also relies primarily on finance, trade, and manufacturing for growth. 75% of the country’s GDP comes from the services sector and it employs about 80% of the eligible workforce. Singapore has a low unemployment rate and low inflation. Moreover, it holds no public debt externally; indeed, currently, it has a surplus. The government carries out judicious foreign investments and provides subsidies on housing, transport, education, and health to its people. All these factors point toward a robust and stable economy.
Additionally, foreigners are allowed to own 100% of the stock in a company incorporated in Singapore without having any local shareholders or partners. There is also no limitation on profit repatriation and foreign currency can be brought into or taken out of the country without restrictions. This is one factor that makes Singapore especially attractive to large companies, who may face enormous taxes moving money otherwise.
2. Favorable tax laws
Singapore is one of the most friendly tax systems in Asia and it imposes no tax on dividends or on capital gains from a business. There is a tiered approach to both corporate and personal taxes in the country. For the first three years, new businesses receive considerable tax benefits that bring their liabilities down to 0% for the first income of S$100k. Moreover, corporate taxes are capped at a rate of 17%. The country also has Avoidance of Double Taxation Agreements in place with more than 50 nations.
3. Infrastructure and geographic location
The country boasts a superior infrastructure that takes first-time visitors by surprise. It has a world-famous state-of-the-art international airport, and excellent highways, buildings, subways, and other technological infrastructure. All these are very important for ease of doing business in Singapore.
The geographic location of Singapore also gives it the unique advantage of having access to the entire population of Asia, especially to other business hubs like China, India, Australia, and Malaysia. Therefore, if you plan to do business in Singapore, you will be able to form important and beneficial trade connections across the region.
4. Availability of a highly-skilled workforce
Singapore is known worldwide for its superior education system. It is therefore not surprising that this country has one of the best available skilled workforces in the market. Singaporeans are known for their hardworking and rule-abiding nature in addition to their educational and technical expertise. Additionally, the favorable immigration systems attract a lot of global talent that you can also recruit for your business by pairing with a reputable recruitment agency. Another big advantage of this workforce is that it is primarily English-speaking, making communication with most foreign HQs easy.
5. Lack of corruption
When it comes to doing business in Asian countries, there can be a certain skepticism owed to the prevalence of corruption. However, Singapore is one notable exception. Public servants in this country are paid very well by the government and there are strict penalties in place for corruption, which comes most often in the form of bribes. As a business owner, you are less likely to be caught up in unnecessary red tapes or being at the mercy of morally compromised officers. Citizens of Singapore tend to be ardent followers of the rule of law.
Thinking of doing business in Singapore?
For most companies considering doing business in Asia, Singapore stands out as a top location for investment. For more information about incorporating a company in Singapore, recruiting the right talent to execute on your businesses vision, or testing the market by using a PEO solution to rapidly, flexibly, and compliantly hire staff in the country, contact the experts at New Horizons Global Partners.