Singapore continues to be a popular Asia-Pacific hub, with almost half of the 7000 multinational corporations based in the city-state choosing to locate their regional headquarters (RHQs) there, according to a new report from corporate services provider Hawksford.
In the first four months of 2019, Singapore continued to be the most sought-after RHQ location in Asia-Pacific with 15 HQ greenfield projects, reports greenfield investment monitor fDi Markets. Among the companies setting up Singapore HQs in 2019 were UK telecoms giant BT and household goods producer Dyson, as well as US-based ride-hailing giant Uber and retailer Foot Locker.
Globally, Singapore ranked second as an HQ destination city in 2018, beaten only by London, which had 60 HQ-related greenfield investment projects, according to fDi Markets.
Across all types of greenfield FDI projects, Singapore ranked second globally as a destination city with 546 projects recorded in 2018, marking a 7.5% increase from 2017, reports fDi Markets. Almost 20% of these projects were in the information and communications technology and electronics sector, while financial services accounted for 17.3% of all projects, as Singapore continues to be a hub for both financial services and tech-based innovation.
These strong FDI figures are partly explained by Singapore’s project-by-project approach to the incentives it provides to foreign investors. “The beauty of Singapore is that they always apply a bespoke approach. They try to understand the potential of a project, what the project will bring, and whether there are subsidiaries, regional HQ elements or R&D elements. They then combine these to make a proposal,” said Dario Acconci, managing director of south-east Asia at Hawksford.
Singapore consistently performs well in fDi rankings, as it was won fDi’s Global City of the Future 2018/19, Smart Location of the Future 2019 and Biotech Location of the Future 2019. Singapore’s success is attributable to numerous factors including the ease of doing business – for which it ranked second globally in the World Bank’s Index 2019 – low level of corruption, sound rule of law and being a crossroads of commercial routes.
Singapore also has strong relationships across the world, enabling relatively frictionless trade with many countries. On a regional basis, it is part of the Association of South-east Asian Nations with strong bonds to China. Globally, in 2018 it signed the Comprehensive and Progressive Trans-Pacific Partnership with 10 countries and signed the EU-Singapore Trade Agreement.
“Although there are many factors contributing to the attraction of a broad spectrum of investments, the most significant factor is the vision of the government. Singapore has a government actively pursuing its vision, with a long-term approach and taking action in order to become an attractive location for smart investments. It is not only addressing and creating its own vision as a nation, but they will continue to readdress, reshape and adjust it,” said Mr Acconci.