What Makes Singapore A Top Destination For Investment
1 November 2022
Singapore is a vibrant country with even more colorful opportunities to grow your assets. It ranks number one as a leading nation in foreign direct investment (FDI) within the Asia-Pacific region and is an opportune capital for investment due to its strong currency and sturdy infrastructure.
With a growing economy, stable political climate, and ideal geographical positioning, Singapore lends itself to being a hub for favorable investment openings and secure living. Here are some factors that place Singapore at the top of destinations for investment potential.
1. Low Tax Rates
For companies’ chargeable income, 75% of up to the first S$10,000, and 50% of up to the next S$190,000 is exempt from corporate tax. There are also no capital gains tax and no withholding tax on dividends. Foreign-sourced income is also tax exempted. These qualities have lent Singapore a “tax haven” title, allowing investors to expedite their savings process and funnel this income into more meaningful endeavors.
These favorable low-tax policies have a myriad of benefits for investors, such as maximizing investable income, keeping their returns high, and having more opportunities for business growth with income and dividends.
2. Tax Exemption for Investment-grade Precious Metals
To qualify for tax exemption (GST), precious metals should be made of gold of at least 99.5% purity, silver of at least 99.9% purity or platinum of at least 99% purity. The precious metals must also be capable of being traded on the international bullion market.
Further reinforcing Singapore’s status as a “tax haven”, this tax exemption facilitates the growth of Singapore’s gold refining and trading cluster. This maximizes your returns on investment-grade precious metals bought in Singapore and those imported into the country.
The Reserve provides state-of-the-art storage facilities and security for precious metals, holding your liquid assets in large amounts securely. Rest assured that our precious metals vault in Singapore was designed to offer you peace of mind, chiefly within our secured and local jurisdiction.
3. Ease of Investment
There are no minimum share capital requirements and foreign exchange controls, with an allowance of 100% in local or foreign shareholding in most companies. Investing is made even more accessible with shares able to be issued in any major currency.
Moreover, Singapore has an open economy furthered by extensive Free Trade Agreements (FTAs). This enables investors to access benefits such as tariff concessions, savings on exports, faster access to certain sectors and markets, and Intellectual Property protection.
4. Highly Competitive Economy
Singapore is one of the world’s most competitive economies and enjoys quality road infrastructure, high efficiency of seaport and airport services, and sea transport connectivity. This interconnected market economy allows for increased productivity, production, and innovation.
With well-built infrastructures to compete with other global sectors, Singapore holds a top title in the world’s most competitive economy. This benefits investors with lower prices in goods, allowing for easier entry into the market.
A competitive market also prevents a particular business from monopolising over a market, giving investors more room to buy shares with more potential for overall growth.
5. Ease of Doing Business
Singapore is consistently ranked among the best countries to do business globally. With an ideal geographical location, companies based in Singapore can access the Southeast Asian market at large through convenient flight routes, making for accessible interpersonal business relations.
Moreover, Singapore is a free port, virtually making all goods that enter duty-free, reinforcing Singapore’s focus on a high return on investment. Setting up these businesses is also easier here, with an expedited company incorporation time of one-to-two days, all with government assistance to begin operations.
6. Stability and Security
Singapore is known for its low to no corruption and safety. Gallup’s Law and Order Index 22 ranks Singapore as the safest country in the world, evidenced by its robust social support systems throughout local communities.
Political stability also stands strong within Singapore, with the political system being a modified version of the United Kingdom’s Westminster Parliamentary system. The adherence to the rule of law has made Singapore one of the least corrupt countries in the world, according to The Transparency International (TI) Corruption Perceptions Index.
7. Strong Military Presence
Singapore has announced a 2023 defense budget of SGD17.98 billion (USD13.4 billion). This amount is 4 times more than Malaysia’s USD3.97 billion and 1.5 times more than Indonesia’s USD8.8 billion military budget. Therefore, Singapore is easily regarded as a mid-sized military powerhouse with Southeast Asia’s best air force and navy, further enhanced by its sophisticated technology and active preparation for possible national emergencies.
8. Swiss-like Neutrality
Despite ongoing tensions between the United States and China, Singapore is one of the few countries in the world that remains neutral and unbiased. In fact, Singapore has long been considered alongside Switzerland as a prime example of having ‘balanced’ foreign policies. Due to its status, Singapore tends to be the host city for many international conferences and events, such as the historic 2018 North Korea-United States Singapore Summit.
Singapore is a hub excellent for many financial and corporate exploits, with the perfect cohesion of resources and good governance for businesses to flourish. It provides investors with the right environment to hold and store their physical assets securely for the long term.
The Reserve offers exceptional storage quality and the capacity to safe-keep your valuables. Our diverse tenant mix also avails services such as asset authentication, digitization, and collateralization services. Since The Reserve is based in Singapore, storing your assets with us will allow you to enjoy the jurisdictional benefits mentioned above.
If you are interested to learn more about you can leverage Singapore as an asset destination, reach out to us today.