Memo on Singapore

The future of Singapore economy is positive. It should adopt policies to diversify its industries into knowledge based industries as well as reduce tax rates to keep up its competitive advantage. It should also diversify its export markets to avoid overdependence on a few developed countries.

The future economic growth in the world is predicted to be in Asia. The World Bank projects annual GDP growth of below 2% in Europe and just under 3% for the USA, while Asia is expected to register GDP growth of around 8%. Many MNC have already started entering Asian markets to tap on its growing markets. Singapore with its centrally located port offers business perfect location to start the journey in Asia, to set up business here and export to the rest of the Asia.

Although Singapore has no natural resources, it has utilized its centralized location and port to optimum usage by positioning itself as the centre for business and investment in the Southeast Asia. It has already created the business environment to attract foreign investment in the country.

Factors behind success:

• Singapore's strategic location as a port has been one of the major factors behind its economic success. Singapore has one of the busiest ports in the world, and is the 4th largest trading center in the world behind New York, London, and Tokyo.

 Ease of business: In Singapore it takes three days to start a business in Singapore compared to the world's average of thirty-four days.1 In fact, According to World Bank data, Singapore is ranked as No. 1 in terms doing business. Whereas a lot of the Asian countries are mired in corruption, Singapore offers one of the lowest corruption and crime rate. These create an environment favorable to the growth of business.

 Low tax rate: Low corporate and personal taxes will also help attract foreign investment and talented foreign employees.

 Political stability: Singapore is a politically stable country. Its government is highly supportive to business and investment.

 Excellent Infrastructure: Singapore has one of the best voice and internet communications infrastructures. It has a major aerospace hub. The super efficiency of Singapore's Changi International Airport is a prime example in this regard. Another exemplary case is Singapore's methods of managing its vehicle population without letting the traffic clog the road network.

 Strong financial institution: Singapore is a leading financial centre for banking, foreign exchange and insurance. Singapore's banking system is considered to be among the strongest in the world. Singapore has the fourth largest foreign exchange market in the world after London, New York and Tokyo. 1

 Openness to foreign talents. Singapore government keenly attracts foreign talents. Some government policies advisory