• Foreign Investment in SG

With attractive advantages that Singapore can offer to foreign investors, no wonder Singapore is the choice for investors from all over the world in terms of investment.

Singapore is a country that has gained an international reputation for economic strength, stability, and rapid development. Today, Singapore is one of the most developed countries in Asia. A significant portion of this development was driven by the high level of investment made by foreigners. The low tax rates of Singapore have encouraged foreigners to invest there; such investments have led to the tremendous growth of the Singaporean economy. Singapore has experienced increases in its total Gross Domestic Product (GDP) for many years; this trend is expected to continue for the foreseeable future.

Why Foreigners Should Invest in Singapore

Foreign investors should invest in Singapore due to the suitable trading environment which exists in the country. The many economic strategies which have been implemented in Singapore have caused the country to become one of the easiest nations in the world in which business activities can be conducted. Furthermore, investing in Singapore is advantageous for foreigners because of the tax incentives and loan schemes from which foreigners may benefit. Singapore has a flexible approach to international trade, and the economic system of the country is one of the most open in the world. Both these facts serve as advantages for foreign investors.

The geographical location of Singapore also grants foreign investors easier access to China, the largest consumer market in the world. This advantage has been leveraged by investors in Singapore’s banking sector and telecommunications sector. The Singaporean government has also been very supportive of foreign investment in the country. Thus, it has provided investors with many different incentives, especially investors who are willing to invest in the financial sector, telecommunications, health, or tourism.

Foreigners investing in Singapore will not have to bear as heavy a tax burden as they would in most other nations. The corporate tax rate and personal income tax rate in Singapore are both among the lowest in the world. The government has also provided tax exemptions and tax reductions for both foreign and local investors alike. The low tax rates in Singapore are of great advantage to foreign investors because they allow investors to maximize their profits. Singapore’s double tax treaties also reduce the tax burden of foreign investors.

Incidentally, if you have encountered any difficulties with taxation in Singapore, we at Paul Hype Page & Co can attend to your tax needs. Our tax experts are well-versed in every element related to taxation in Singapore. We will be able to assist you with any problems which you need us to solve for you.

Singapore’s technological standards are among the highest in the world; this fact has also aided in the development of all other industries in the country. The Singaporean government also collaborates with both local and foreign investors alike to raise the standards of the country’s economy by creating conditions in which businesses may thrive.

One other reason why Singapore has a high prevalence of foreign investment is the fact that there are numerous advantages available for foreign investors. The Singaporean government has made several successful attempts to attract foreign investors into the country by attracting much foreign direct investment (FDI) to the country. This FDI serves as a link between foreign investors and the economy of Singapore. The effects of FDI include an increase in space for open markets, the setting up of agencies that promote investment, the strengthening of FDI linkages, and an increase in the entry of first-time foreign investors, among others.

For all the reasons which have been provided as well as many others, foreign investors should consider Singapore as a country in which many positive outcomes result from investing.

Most Stable Investments in Singapore

Most foreign investors are concerned about making investments that will give them the best possible returns. Foreign investors should be prepared to accept a return with a value close to the risk-free rate. The risk-free rate refers to the returns which are to be expected if the investor does not take on any risks. There are hardly any investments that do not carry any risks. Despite this fact, investors should do what they can to reduce the risks connected to their investments. Every investor ought to develop strategies and make investments at a level of risk which they deem to be suitable.

In Singapore, there are six types of investments that can be made by foreign investors who would like to be assured of a significant financial return. These investments are a stable and viable option for investors who are attempting to minimize their exposure to risks. Singapore Government Treasury Bills are among the investments in which a foreign investor can invest. Such investments are usually made by investors in search of short-term investments (STIs).

Singapore Government Securities bonds

Many foreigners who invest in Singapore also invest in Singapore Government Securities bonds. Such bonds are issued by the Singaporean government; these bonds are valid from anywhere between two and 30 years. As a long-term bond, a bond of this type does carry a degree of risk; however, it is close to being risk-free. Therefore, it offers a return at a rate like the risk-free rate.

Singapore Savings Bonds

Singapore Savings Bonds are among the most common investments in which foreign investors invest. There are lower returns on the bonds for startups. If investors do not redeem the bond, the rates will increase. Such will be the case every year until the conclusion of the 10th year. This is the case so that investors will hold the bonds for an extended period. However, investors are permitted to redeem the bonds at any time.

Fixed Deposit

The fourth type of investment is the fixed deposit. Fixed deposits serve as a way for investors to earn returns on their money after this money has been deposited in a savings account. Most banks in Singapore offer promotional rates that favor foreign investors.

Central Provident Fund (CPF) Top-Ups

Other notable investment options in Singapore are the Central Provident Fund (CPF) Top-Ups which provide opportunities for investors to earn interest on their funds. These funds are supplied by the government and offer return rates at a minimum of 4% per annum. There is also usually an additional 1% interest rate to be earned by the investor.

Exchange Traded Funds (ETFs)

One other way in which foreign investors might invest in Singapore is Exchange Traded Funds (ETFs). ETFs are of particular importance in the financial and industrial companies of Singapore, therefore, foreign investors should consider investing in either or both sectors.

Unit Trust

Foreign investors might also choose to invest in a unit trust. The advantage of investing in a unit trust can be seen in the reduced investment risk as well as the ability to have professionals managing all funds and personal finances. Investment in a unit trust may also help foreign investors to maximize their profits which they have made in Singapore.

Profit Maximization by Foreign Investors in Singapore

The first step towards profit maximization that should be taken by foreign investors in Singapore is that of setting financial goals. The attainment of financial goals will ensure that the finances of a foreign investor in Singapore are in order. Once the investor’s finances are in order, the investor should visit a brokerage firm to open a brokerage account. A brokerage account is an account with a broker that will allow an investor to sell, purchase, and hold securities. Investors should select a monthly investment plan which will be in line with their investment target goals, willingness to take risks, and income needs.

There are various investment plans in Singapore which may be used by foreign investors. Such plans include deep value investing, value-growth investing, and income investing. Foreign investors should monitor the profile and business area of companies considered to be viable investment options in Singapore. They also need to maintain a watchlist to monitor companies’ portfolios of stocks. Foreign investors might also choose to purchase stocks as a means of gaining influence in the business world while at the same time maximizing the profits they gain through their investments in Singapore.

Foreign Investment in Singapore FAQs

What is the corporate tax rate in Singapore?2020-11-18T09:31:08+08:00

The corporate tax rate in Singapore is 17%. 

What is a unit trust?2020-07-03T15:16:43+08:00

A unit trust is a type of investment which is categorized as a collective investment. Unit trusts utilize just one fund which contains all involved investors’ money; this fund is overseen by one or more fund managers. Unit trusts only exist in 11 countries of the world; Singapore is one of these countries

Why is there a large variance in the validity periods of Singapore Government Securities bonds?2020-07-03T15:16:20+08:00

Singapore Government Securities bonds are valid from anywhere between two and 30 years. The reason for this large variance in validity periods stems from the fact that such bonds have multiple different purposes. Some investors may use these bonds to diversify their investment portfolio; others, for the purposes of holding a long-term investment; and still others, as a means of receiving a steady income.

How much foreign direct investment (FDI) does Singapore receive?2020-07-03T15:15:06+08:00

According to the latest statistics, Singapore received approximately US$77.65 billion in FDI in 2018. This figure reflects an increase from the previous year, which saw the country receive approximately US$75.72 billion in FDI.

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