Research shows Singapore is becoming an increasingly important base for businesses seeking to grow in Asia, and particularly Southeast Asia. Some 4,200 subsidiaries across a wide spectrum of industries – from technology and commodities to logistics and more – are already taking advantage of the country’s stable tax, legal and regulatory systems and business-friendly environment to set up their regional headquarters there, according to the Singapore Economic Development Board (EDB).
“Singapore was selected as the site for [our] Asia Pacific intellectual property (IP) licensing centre in view of its mature legal system, the government’s strong support and respect for IP, and its overall strength as a strategic base for IP management,” a Hewlett-Packard spokesperson recently told consultant Russell Reynolds Associates.
That view is widely shared. “Singapore is a country of ones and twos – the most competitive economy, number one in the Asia Pacific for talent competitiveness, number one in the Asia Pacific for digital competitiveness and the second most connected country in the world. It is attractive for companies to base their regional hubs here, create jobs and utilise Singapore's connectivity with the rest of the ASEAN region,” David Kelly, executive director at the British Chamber of Commerce, recently told the Singapore Economic Development Board.
And that’s not all. For companies considering a ‘China Plus One’ strategy, where China remains the main supply source or consumer market but the company diversifies some activities to other countries, Singapore is increasingly seen as an attractive choice. More international firms in China, for example, are now seeking to set up Singapore-based “control towers” – hubs of operational and technical expertise that can help them capture growth opportunities and manage their expansion in the region.
Below, we examine in greater detail why many corporations are choosing to ‘hub’ in Singapore.