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Singapore – A Waypoint to International Expansion

Within the vibrant ASEAN region, Singapore is a country that has demonstrated significant economic growth in the contemporary global economy. Owing to elements like its strategic location, quality of talent, and its governmental efforts, Singapore is widely renowned as a destination for foreign businesses looking to expand their operations across domestic borders. Due to the country’s involvement in the Association of Southeast Asian (ASEAN) region, Singapore also acts as a gateway for international businesses looking to capture the sizable and expanding ASEAN market. In Empire State, we aspire to deliver the best value to our clients by supporting their expansion into markets with enormous potential. Hence, we take it upon ourselves to understand the Singaporean market through extensive research to ensure an effective consulting experience for our clients.

Why is Empire State pushing for expansion into Malaysia? The reasonings behind Empire State’s recommendation may be summarized by the following driving factors:

1. Strategic business hub

2. High Quality Talent

3. Government Support

As one of the founding members of ASEAN along with Malaysia, Thailand, Indonesia, and the Philippines, Singapore may also provide investing businesses with the opportunity to venture into the dynamic market of the ASEAN region. Located at the southern extremity of the Malay Peninsula, the country has a strategic location with a six-hour radius distance between any Southeast Asian country. Thus, the country is quoted by the Singapore’s Economic Development Board as “the best home in Asia for business”. Subsequently, Singapore is ranked as the most globally connected country in 2022, recording over 7,400 flights to and from the Changi Airport on a weekly basis (DHL, 2024). Furthermore, the country’s sea-port infrastructure has been highly renowned for the past two decades and links to 600 ports globally. According to CSC Knowledge (2018), more than 130,000 ships call at Singapore every year. Leveraging on the country’s connectivity and established networks that provide investors with direct access to the global market, Singapore is expected to remain as an attractive hub for international business with a high global connectivity in the next few decades.

High quality talent

According to the Singapore’s Economic Development Board, Singapore is known as a home for the best talent, boasting a university degree coverage of at least 30% of its workforce, with another 15% being workers with a diploma or professional qualification (EDB, 2024). According to Statista (2023), the adult literacy rate in Singapore is at least 97.6%, with a steady increase over the last two decades. In terms of business communication, Singapore is ranked first in Asia and 2nd worldwide for the English proficiency of their workforce, highlighting the country’s workforce capability to effectively communicate with the diplomatic trade language (EF, 2023). Furthermore, the Singapore government has also introduced initiatives such as SkillsFuture to keep its workforce updated with new prominent skills as a means to prepare them in digital and tech roles for futureproof purposes (MOM, 2024). As such, business procedures tend to be efficient when it comes to expanding in Singapore due to its highly competitive pre-existing workforce.

Government support

Despite Singapore’s status as a developed country today, the country still operates in an effective regulatory environment like a developing country with incentives such as low tax rates to foster its sectoral growth and encourage investments from non-domiciled investors. For example, the country offers one of the world’s most attractive corporate tax rates of 17%. The Economic Development Board of Singapore also encourages relocations of companies into Singapore through their regional headquarters (RHQ) and international headquarters (IHQ) incentives which provide companies with a concessionary tax rate and a below-regular corporate tax rate respectively. The Singapore government has signed over 27 free trade agreements (FTAs) and over 70 comprehensive avoidance of double tax agreements to facilitate its business procedures across borders (MTI, 2024). Owing to the country’s attractive incentives and the exemption from capital gains and dividend tax, Singapore is thus a coveted destination for businesses looking to expand their operations internationally.

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