Sinagpore is a famously small country. It is 42 kilometres long from West to East and 21 kilometres broad from North to South. Yet it has recently been rated one of the worlds' most desired immigration destinations. And why would thousands of international conglomerates choose Singapore as their base in Asia-a tiny country with a population of less than 5 million? Why do so many choose to start a business in Singapore?
A Pro-Business Environment
Much has been said and written about Singapore’s pro-business environment-not least by the Singapore government itself. The Singapore government is the biggest champion of the country’s pro-business environment, with constant initiatives to make the business environment ever more efficient and competitive.
As a result of these initiatives, the World Bank’s Doing Business 2009 Report (which the author of this article had the pleasure of participating in) ranked Singapore as the world’s easiest place to do business, ahead of New Zealand, United States and Singapore’s closest competitor, Hong Kong.
And what does a pro-business environment have?
For starters, very little bureaucracy and a high level of transparency. In 2006, the Political and Economic Risk Consultancy (PERC) ranked Singapore number one for minimum bureaucracy and red tape in Asia. Information about Government policies, legal requirements and changes to laws are widely, easily and cheaply available. If any changes are planned, the ministries or government bodies publish draft legislation for public comment months before its finalisation.
The incredible efficiency of the public sector cuts down the costs of doing business tremendously and gives good support to the private sector.
In addition, there are no restrictions on foreign ownership of Singapore businesses. Singapore has no foreign exchange controls-and has never had them. There are also no restrictions on the repatriation of corporate profits nor on the import of capital into Singapore.
Low Corporate Tax Rate
The corporate tax rate for the Year of Assessment 2010 is 17%. It doesn’t get much better than that. In addition, there is no tax on capital gains.
As a result, various tax efficient structures can be explored, including structures that involve the use of off shore companies.
Well Developed Infrastructure
Singapore has an extremely well developed infrastructure. The ultra efficient Changi Airport which has often been voted as the Best Airport in the world is also one of the world’s busiest, transporting millions of visitors from around the world to Singapore’s shores.
The country’s efficient public transport network transports millions of Singaporeans around the island in minutes, an efficiency that again keeps the cost of doing business low.
On top of that, gadget geeks will be glad to know that Singapore has a nationwide network of free wifi in public areas which can be used to access the internet and is planning a new nationwide ultra high bandwidth network it calls the Next Generation Nationwide Broadband Network.
Singapore is well known for its respect for and its protection of intellectual property rights. Its intellectual property rights laws are up-to-date. IPRs are also quickly and cost efficiently enforced, making Singapore an ideal location to base research and development efforts in Asia Pacific. In fact, rumour has it that the world's first MacBook and iPhone were assembled in Apple's factory in Singapore.
The above are some of the reasons why we think Singapore is a great place to do business. If you have any others, do let us know!
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