Growth sectors: Debt restructuring, advanced technology such as artificial intelligence and robotics
Regional access: Kuala Lumpur is 1hr away by air, Jakarta is 1h50, Ho Chi Minh City is 2hrs; Bangkok is 2h25, Hong Kong is 4hrs
If you step back and look at Singapore from a historical perspective, its importance came from being a strategic location for the old east-west trade routes. It is not much different today, as the success of Singapore in recent times has largely been driven by its strategic geographical location. It has also prospered under some exceptional leaders who have focused on long-term vision rather than short-term tactics.
This approach has helped to create an ideal location in which to set up businesses.
Considerable political and economic stability particularly helps set Singapore apart in the Southeast Asia region. And of course, Singapore is ideally situated. Within a seven-hour flight you can be in practically any northern, western or southern Asian country, and within three hours you can be in virtually any Southeast Asian country. It is also served by what passengers consistently say is the number one airport in the world, along with a world-class port.
Business-minded hub where east meets west
Many businesses use Singapore to gain a foothold in the region before entering markets such as Malaysia or Indonesia. Southeast Asia has a significant level of high-growth opportunities and is still quite under-developed in terms of its potential.
Some businesses may choose to set up regional headquarters in Singapore while siting production plants in neighbouring countries such as Vietnam or even China. Domestic appliance maker Dyson, for example, has announced it is moving its global HQ from the UK to Singapore but has carried out a significant proportion of its manufacturing operations in neighbouring Malaysia since 2002.
Economic stability and other benefits
Businesses could, of course, set up almost anywhere in Southeast Asia but many of the region's economic and political policies are in a constant state of flux, and much less stable compared to Singapore.
Beyond economic stability, there are other benefits for business. Singapore is one of the world’s top locations in terms of intellectual property protection, which is conducive for businesses setting up headquarters there. It also has a very fair tax regime and it is relatively easy to trade across borders as there are double-taxation treaties with more than 70 countries.
There is a skilled workforce with a highly attractive blend of both local and foreign talent. Singapore boasts two of the world’s top 25 universities, as well as being highly regarded internationally for its rates of achievement at school level. This pool of talent allows local businesses to flourish but also helps to attract skilled foreign talent to call Singapore home.
On top of that, it’s a safe city with low crime and some of the highest levels of life expectancy in the world.
Financial and technological support
Singapore has a strong start-up ecosystem, with considerable help available from the government-run Economic Development Board (EDB).
There is a high level of technological readiness here, so Singapore is seeing a lot of investment in the fintech space, as well as in areas such as artificial intelligence and robotic processes. Many leading global technology companies – from Google and Microsoft to Hewlett-Packard – have regional headquarters in Singapore.
It is also one of the largest financial hubs on the planet: it can handle some of the most complex projects, for example, interest rate hedging for the foreign exchange market. More recently, the city is being promoted as a centre for debt restructuring, because of its workforce expertise and the clear legal framework.
Manufacturing operations do still exist in Singapore itself but the growth is limited by the city’s size and labour force. Any businesses considering relocating to Singapore should get in touch with the Singapore EDB. They are proactively working to attract business development in Singapore. It’s certainly far easier to get government cooperation or even a seat at the table here than elsewhere in the region.
Singapore – the ideal gateway city
With that level of support, and the strength and depth of the existing business networks in Singapore, it’s difficult to imagine a more stable and strategically positioned gateway city for Southeast Asia. If you are looking to boost growth in a stable and welcoming environment for businesses expansion, or to start trading internationally, Singapore could offer the ideal option.
If you'd like to find out more about business expansion in the Singapore region or to discuss your international plans, contact Andrew Howie.