International companies entering the Singaporean market are attracted by the many opportunities the country offers. Although Singapore is a relatively tiny city-state in Asia, it is a significant player in commerce and finance. While Singapore’s nominal Gross Domestic Product (GDP) in 2021 ranked only 38th in the world at 378.6 billion US dollars, its population is among the world’s richest, with a per capita GDP of US$66,263 ranking sixth globally. 

Singapore’s economy is the sixth largest among fellow members of the Association of Southeast Asian Nations (ASEAN). Additionally, the World Bank’s absolute ease of doing business report in 2020 placed Singapore second best globally. It is the only Asian nation with a Triple AAA credit rating and is a crossing point for east and west shipping lanes (with the world’s second-largest port), while 50% of the world’s population is within a six-hour flight away. Ultra-clean, ultra-safe and a nation with many tourist attractions, Singapore blends the modern world with heritage, history and culture.

Starting a business in Singapore

All Singapore companies operate under the Companies Act, which covers incorporation and regulations dealing with shares, directors and officers, accounts and other provisions. Quotas apply to the make-up of the workforce, while incoming companies must set up a legal entity if they plan to hire staff and operate their payroll. The most popular choice is to establish a private limited liability company. 

The registration procedures include the following:

  • Verifying that the company name is unique, reserving it with the Accounting and Corporate Regulatory Authority (ACRA) via BizFile, and obtaining the Unique Entity Number (UEN) to be used on all official documents.
  • Registering the business activities with the Singapore Standard Industrial Classification (SSIC) and obtaining any relevant licenses.
  • Registering with the Inland Revenue Authority of Singapore (IRAS) and with Singapore Customs if the business involves importing and exporting.
  • Registering for Goods and Services Tax (GST) is compulsory if the taxable revenue exceeds SGD one million (€680,300, US$742,343).
  • Lodging details of directors, shareholders and SSIC code for the particular business activities with BizFile.
  • Once the application and reservation are approved, registering with BizFile the business address, share capital and shareholders, directors and company secretary if applicable, company’s constitution and proof of paid fees.
  • Completing Forms 45 and 45B for each director and company secretary.
  • Applying for the Central Provident Fund (CPF) Submission Number (CSN), enabling employers to undertake transactions with the CPF Board.
  • Once incorporated, opening a business bank account, complying with strict ‘Know Your Customer requirements.

Expanding your business into Singapore

Expanding a business in Singapore, as in any overseas territory can bring challenges. Moving staff worldwide means lengthy processes to obtain visas and work permits. When employees are in place, who will handle payroll? How will your company deal with regulations on taxation, entitlements and benefits, termination and severance? Your business plan will have to answer all these questions.

Singapore generally welcomes foreign investment. However, there are quotas on the number of foreign employees allowed to work compared with the number of Singaporeans in the workforce. Employment legislation is a mix of the Employment Act – which does not apply to all workers – as well as guidelines from the Ministry of Manpower and tripartite agreements between employers, trade unions and the government.

Where to locate within the country?

Singapore is a country, an island and a city-state in Southeast Asia, and is only around 275 sq. miles which means it would fit nearly four times into Rhode Island, the smallest state in the United States! So, no trouble getting around, especially with their fast and efficient transportation system, considered one of the best in the world. It is also the second-largest global port and is a hub for east and west shipping traffic. When looking to locate an office in Singapore, distance will not be a factor. In fact, the whole of Singapore is a conducive hub for business. There is a thriving retail industry on the one hand and biomedical research on the other in an R&D hub at One-North. This is where you will find an assortment of growth industries for 2022 such as finance, ICT, the services section and a strong resurgence in manufacturing and trade.

Examples of good office and lifestyle areas to settle in are:

  • Marina Bay: it is a highly prosperous area, boasting large commercial and residential centres, business hubs and entertainment complexes in one of the most prestigious locations for business in Singapore, although it does bring with it high costs.
  • Tanjong Pagar: once a fishing and agricultural community, it has seen its landscape blossom and develop into a vibrant business and commercial centre with its polished skyscrapers now forming part of the country’s Central Business District – home to many media, consulting, advertising and trading companies. Shipping companies are also attracted to the area as one of the world’s busiest container ports. This area certainly has ‘buzz and colour’ with restaurants and coffee shops galore.
  • Orchard: known for its retail, entertainment and for starting a business; it offers lots of choices when it comes to accommodation. It has an excellent infrastructure and glitzy boulevards, malls and hotels; it has the hustle and bustle of a busy business community but also the peace and quiet for downtime with parks, museums and spas.
  • Jurong Island: in south Singapore, it houses more than 100 global chemical and petrochemical companies on 12 square miles of reclaimed land and is one of the world’s leading chemical manufacturing sites and intends to stay that way – one step ahead of the game. It is the face of sustainable energy solutions and there are grants available to qualifying small and medium enterprises and start-ups, through the Enterprise Development Grant.

What to look for in your office premises:

  • Does it make a good impression and provide a suitable working environment to attract first-class talent?
  • What manufacturers and distributors do you need to be close to?
  • Are there special economic zones or free-trade areas giving tax benefits or grants?
  • Can you benefit from being in a business cluster/hub?
  • Workspace, communication and storage facilities – with room for expansion?

Some Singaporean Facts

  • Capital – Singapore City.
  • Population – Around 5.9 million.
  • Regions – Central, North, East, North East and West.
  • Official language – Malay, Tamil, English and Mandarin Chinese.
  • Economy – 378.6 billion US dollars, 38th globally; US$66,263 per capita, sixth globally.
  • Leading sectors by GDP – Manufacturing 21.5%, wholesale trade 16.8%, Finance and insurance 15.7%, Other service industries 10.8%.
  • Primary exports include – Electrical machinery and equipment; computers; mineral fuels; optical, technical and medical apparatus; gems and precious metals.
  • Leading imports include – Machinery, transport equipment and crude petroleum.
  • Main trading partners – China, USA, Malaysia, Indonesia and Japan.
  • Government – Unitary parliamentary republic.
  • Currency – Singapore Dollar (SGD)

Advantages and Challenges when entering the Singaporean Market

Some advantages of entering the Singaporean market include the following:

  • Location: Geographical position in southeastern Asia is ideal for further expansion into Asia and among Pacific Rim nations. Singapore is a meeting point for east and west shipping lanes and has the world’s second-largest port.
  • Trade: Mainland China, the US and Malaysia are Singapore’s main trading partners. In 2021, exports to Mainland China exceeded imports. Singapore is the European Union’s 16th largest partner but the second largest among the Association of Southeast Asian Nations (ASEAN) nations. Singapore ranks highly for cross-border trading.
  • Taxation: Competitive and comparatively low rate of corporate tax at 17%, with partially lower rates for start-ups and on the first levels of taxable income.
  • Business: The World Bank’s final ‘ease of doing business report in 2020 ranked Singapore second globally.
  • Infrastructure: Singapore’s roads and expressways have benefitted from substantial investment and connect all corners of the island for people and goods.

Some challenges of entering the Singaporean market include:

  • Employment: Reliance on foreign workers to compensate for an ageing workforce.
  • Trade: Increased competition from fellow ASEAN members.
  • Economy: Rising inflation affects wages and prices.
  • Workforce: Some structural unemployment fears as workers from sectors such as services do not have skills for vacancies in other areas.
  • Politics: Potentially vulnerable to US-China trade war.
  • Red tape: Obtaining construction permits involves 11 procedures requiring permission from at least four official bodies. Registering property is similarly protracted.


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