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1. Singapore export overview
Singapore is a small, but wealthy city-state with an open and trade driven economy. It’s a leading global business hub, located where the major east and west shipping lanes converge.
Contact a Department for International Trade (DIT) Singapore export adviser for a free consultation if you’re interested in exporting to Singapore.
Singapore has a stable government, strong rule of law and effective regulatory system. It is ranked by the World Bank as the easiest place in the world to start, run and do business. You can set up a new business in a matter of hours.
It’s a financial, shipping and trade hub for the Asia Pacific region, and the government has a pro-business economic and trade policy.
Over 1,000 British companies have a presence in Singapore, and 30,000 British residents live there.
Benefits to UK businesses exporting to Singapore include:
- free flow of goods and capital
- current exchange rate makes UK products and services attractive
- common language and strong historical ties
- similar business and legal practices
- similar technical standards
- close to major Asia Pacific economies
- UK’s largest trade partner in south east Asia
Strengths of the Singapore market include:
- 50% of the world’s population within 6 hours flight
- fourth largest global financial centre
- Asia’s only AAA credit rating from all 3 agencies
- Asia’s strongest Intellectual Property (IP) protection
- highly skilled and educated local population
- low corruption and strong rule of law
- excellent infrastructure and transport connectivity
The main challenges of doing business in Singapore are due to the size of the country and population.
Specific challenges include:
- 8 hour time difference with the UK
- can be expensive place to do business
- widening income inequality has led to some anti-foreigner sentiment
- tighter foreign worker restrictions including quotas
- very open economy which makes it vulnerable to global economic downturns
- restrictions on expansion in retail banking and licences for the legal sector
3. Growth potential
As one of the world’s most open economies Singapore is a indicator of global trade. Growth slowed in 2015 to 2% from 2.9% in 2014 mainly due to sluggish trade with China.
The International Monetary Fund (IMF) predicts growth of 2.9% in 2016. Challenging conditions are likely to persist and growth of 1 to 3% annually is forecast over the medium term.
Singapore is the second most densely populated country in the world with one-third of the population made up of foreign workers and residents. It’s economy:
- is the 36th largest in the world
- is vulnerable to external shocks
- has per capita income of USD 56,000, the highest in Asia Pacific and higher than most developed countries including the UK
Singapore is currently restructuring its economy to:
- reduce its dependence on imported labour
- improve productivity
This move towards knowledge-driven, high-value and creative businesses offers huge opportunities for UK businesses with expertise in these areas.
3.1 Association of South East Asian Nations (ASEAN)
ASEAN is an increasingly important economic region which is:
- made up of 620 million residents
- predicted to become the fourth largest single market by 2030
- expected to add 200 million residents to the middle class
Singapore is ASEAN’s most developed economy and regional trade and finance hub. It’s a natural starting point and gateway into the region.
Many of the UK’s largest companies operate their regional businesses from Singapore. They include Barclays, BP, GSK, HSBC, PWC, Rolls-Royce, Standard Chartered, Shell, Tate and Lyle and Unilever.
3.2 Free Trade Agreements and partnerships
Singapore has 20 regional and bilateral Free Trade Agreements (FTAs) with 32 trading partners, covering the majority of its trade. It is a member of the Trans-Pacific Partnership.
The European Union (EU)-Singapore FTA concluded in October 2014:
- will be the EU’s first in south east Asia
- awaits finalisation due to EU Commission’s request for a European Court of Justice opinion on whether it needs to be ratified by all member states
- when implemented will make it easier for UK companies to access opportunities in government procurement and services sectors
4. UK and Singapore trade
Singapore accounts for half of UK exports to ASEAN, worth £5.6 billion in 2014, although some will be re-exported elsewhere. It is one of our largest trading partners in Asia and one of the few countries with which the UK has a trade surplus.
The top 10 exports from UK to Singapore are:
- machinery and transport equipment
- business services
- financial and insurance services
- miscellaneous manufactured articles
- transport services
- food and beverages
- manufactured goods
- travel services
- intellectual property
The UK is the largest EU investor into Singapore (on par with the Netherlands). It’s the fifth largest total source of foreign direct investment (FDI) into Singapore with investments worth over £30 billion at the end of 2014.
Half of Singapore’s FDI into the EU goes to the UK, including some significant investments in infrastructure.
5. Opportunities for UK businesses in Singapore
Department for International Trade (DIT) provides free international export sales leads from its worldwide network. Search for export opportunities.
5.1 Transport and infrastructure
There is a strong construction demand from:
- public housing developments
- institutional building
- civil engineering projects
Singapore’s Land Transport Authority (LTA) is overseeing the doubling of the Mass Rapid Transit (MRT) network to 360km by 2030. There will also be major renewal projects for older lines on the MRT. Up to 2020 it will tender for the design and construction of the:
- 13km underground Thomson-East Coast Line (9 stations, ‘4-in-1’ depot for 220 trains for 3 MRT lines and 500 buses)
- 20km Jurong Region Line
- 50km Cross Island Line
- extensions to the Downtown Line, Circle Line, and North East Line
- rapid transit link to Johor Bahru in Malaysia (request for information (RFI) closes 18 November 2015)
Plans aim to boost Changi’s capacity by building:
- an expanded terminal 1 and Project Jewel by 2018
- a new terminal 4 to replace the Budget Terminal by 2017
- extra aircraft stands south of terminal 3 for T4
- a new 3rd runway and new mega terminal 5
The relocation of Singapore’s transshipment port operations will nearly double capacity by 2023. This will open up extremely high value opportunities for UK businesses. The port leases at Tanjong Pagar, Keppel and Brani will end in 2027.
Contact Senior Trade and Investment Manager firstname.lastname@example.org for more information on transport and infrastructure opportunities in Singapore.
5.2 Financial and professional services
The financial and professional services sector currently makes up about a quarter of Singapore’s GDP. There is a substantial UK presence in this sector.
There are opportunities for companies in:
- foreign exchange
- asset and wealth management
- insurance and reinsurance
- consulting services
Contact Senior Trade and Investment Manager email@example.com for more information on financial and professional services opportunities in Singapore.
Singapore’s Smart Nation initiative aims to rally relevant individuals and organistions to co-create innovative solutions related to living, transport and healthcare. It will harness technology to improve the lives of citizens, create more opportunities and build stronger communities.
Infrastructure investment is expected to grow by 50% to about £15 billion by the end of 2020.
Current projects on trial include:
- a 6 kilometre test route for autonomous vehicles (AV)
- smart technologies test-bed for car parks, lighting and waste management
- mobile applications to facilitate communication between the public and providers of public services
There are opportunities in UK companies (including start-ups) who have solutions especially relating to:
- living (ageing)
- cyber security
Contact Senior Trade and Investment Manager firstname.lastname@example.org for more information on opportunities in ICT in Singapore.
5.4 Creative industries
Singapore’s government has recognised the Creative Industries as a vital component in enhancing Singapore’s economy. Its Creative Industries Development Strategy aims to develop a creative economy.
There are 3 areas of opportunity for UK companies in terms of partnership and supply of expertise:
- experience economy, including conceptual design and innovative technology to enhance local and international tourist attractions in terms of storytelling and content
- media, to make Singapore a regional hub for south east Asia digital media, co-production and content creation
- design, specifically environmental design, industrial, product and fashion design, advertising and visual communications design and software design
Contact Trade and Investment Manager email@example.com for more information on opportunities in the creative sector in Singapore.
5.5 Biomedical sciences and healthcare
There is a strong drive to grow Singapore’s capabilities in biomedical sciences sector (BMS) research. There is a focus on R&D, clinical trials, and commercialisation, supported by a high level of IP protection and industry standards.
Leading pharmaceutical companies have multiple manufacturing sites in Singapore with opportunities for supporting products and services.
Singapore’s healthcare system is ranked the sixth most effective in the world and it remains keen to enhance its position as the regional hub for medical excellence.
The aging population has increased the need for acute care hospitals and long-term care services. Hospitals regularly test and introduce new medical technologies. This gives UK companies with innovative products an opportunity to work with hospitals to research and introduce their products into the market.
Contact Senior Trade and Investment Manager firstname.lastname@example.org for more information on life sciences opportunities in Singapore.
5.6 Education and training
Singapore aims to sustain its economic growth through higher skills and innovation.
Singapore’s focus on the SkillsFuture programme means that Singapore is projected to nearly double spending on continuing education and training to over S$1 billion (£477 million) per year from now to 2020.
There are opportunities for UK businesses in the areas of:
- preschool / early childhood education
- adult learning
- educational technology solutions
- degree partnerships / collaborations with private educational institutes
Contact Trade and Investment Manager email@example.com for more information on education and training opportunities in Singapore.
5.7 Energy and environment
Singapore is Asia’s leading oil trading hub. It has extensive oil storage facilities and is seeking to increase its refining capacity.
The clean energy sector is also an increasingly important area for Singapore.
Singapore is recognised as a ‘Global Hydrohub’ with about 180 water companies. It’s an ideal springboard for environmental and water companies looking to serve the region.
There are opportunities for UK business in the areas of:
- smart grids and renewable energy technologies such as solar photovoltaic (PV)
- deep tunnel sewerage systems
- water desalination projects
- civil works
Contact Senior Trade and Investment Manager firstname.lastname@example.org for more information on energy and the environment in Singapore.
6. Start-up considerations
All businesses must be registered with the Accounting and Regulatory Authority of Singapore (ACRA). The process is very simple and can be completed online.
The 3 most common types of company are a:
- foreign registered branch which is not a separate legal entity where liabilities extend to parent company
- representative office which may only conduct market research or coordinating activities
- private limited company which is a distinct legal entity with limited liability
Registration time varies from 1 to 5 days depending on the business structure you choose.
Before you can start a business in Singapore you:
- must be at least 18 years of age
- must not be an undischarged bankrupt
- must not be disqualified under sections149,149A or 154 of the Companies Act
- will need to apply for an EntrePass from the Ministry of Manpower (MOM) to be actively involved in managing company operations
Contact the Department for International Trade (DIT) team in Singapore for information on legal and accounting professionals who can give advice to British businesses looking to set up in Singapore.
Many companies engage local agents and distributors as an effective route to market.
Franchising is a well tried option and a number of UK brands have a presence in Singapore including Marks & Spencers and New Look.
7. Legal considerations
The legal system in Singapore is very sophisticated and is based almost entirely on British common law between the 1820s and 1970s.
Singapore benefits from:
- extensive legislative framework
- reliable courts and dispute resolution
- low levels of corruption
- being consistently rated as the best place in Asia for IP rights protection
Company law in Singapore is very similar to that in the UK. There is no restriction on the type of business that may be set up. However in some sectors businesses may have to apply for special licenses from specific government departments in order to do business.
These include the:
- Monetary Authority of Singapore
- Ministry of Law
- Ministry of Health
- Infocomm Development Authority of Singapore
- Media Development Authority
- Agri-Food and Veterinary Authority of Singapore
- Hotels Licensing Board
Non-residents must hold a valid employment pass (EP) before they can work in Singapore. On average, it takes less than 2 weeks to get employment passes for foreign staff. The Ministry of Manpower website provides full details of all employment passes, as well as dependency passes for family members.
Contact the Department for International Trade (DIT) team in Singapore to help find tax and legal advisers before entering into agreements.
7.1 Standards and technical regulations
The Consumer Protection (Safety Requirements) Regulations (CGSR) protect consumers from unsafe products.
SPRING Singapore acts as the safety authority to ensure the safety of 45 categories of household electrical, electronic and gas products. These products are classed as controlled goods and suppliers must register them with SPRING before putting them up for sale.
Packing and labelling of:
- food products is governed by the Sale of Food Act
- medicines and cosmetics is regulated by the Medicines Act
Contact the Agri-Food & Veterinary Authority of Singapore (AVA) for detailed guidelines on food labelling.
Contact the Heath Sciences Authority for information on medicines and cosmetics.
7.2 Intellectual property (IP)
Singapore’s IP regime has been consistently recognised as the best in Asia and one of the best in the world by international surveys including:
- World Economic Forum’s Global Competitiveness Report
- the Property Rights Alliance’s International Property Rights Index
- Taylor Wessing’s Global IP Index
It has extensive programmes to develop its IP infrastructure and ecosystem and aims to become the IP hub of Asia. According to the Global Innovation Index 2015, Singapore is also Asia’s most innovative country.
The Intellectual Property Office of Singapore has full information on legislation and filing requirements.
Contact the UK Intellectual Property Office (UKIPO) IP attaché in Singapore for support and advice on IP in Singapore and south east Asia.
8. Tax and customs considerations
Singapore offers a low tax environment for businesses.
8.1 Sales tax
The Goods and Services Tax (GST) is 7%.
8.2 Company tax
The corporate tax rate is 17%.
There are also financial incentives for new businesses that meet qualifying conditions. Companies can claim:
- for tax exemption on the first S$100,000 (about £50,000) of normal chargeable income for each of its first 3 years of assessment
- a further 50% exemption on the next S$200,000 of normal chargeable income for each of the consecutive years of assessment
- a 50% corporate income tax rebate, subject to a cap of S$20,000 per year of assessment for 2016 and 2017
8.3 Income tax
The individual tax rate is tiered between 0 and 20%. The top rate of tax will increase to 22% in 2017.
Import and export permits are required by Singapore customs.
Singapore generally operates a free trade regime and more than 99% of imports are duty free. The only exception is on 6 lines of alcoholic beverages, but these will be minimised once the EU-Singapore FTA comes into force.
You can find more about import tariffs in the Market Access Database.
For import of all goods, including controlled and non-controlled items, businesses are required to:
- obtain an IN permit through TradeNet
- pay the duty or GST due at time of importation
9. Business behaviour
Singapore is in some ways more conservative than the UK.
It is important to:
- address people formally
- exchange name cards at the first meeting
10. Entry requirements
All visitors must have a passport with at least 6 months validity. British citizens do not require a visa. You can stay for up to 30 days for tourism, business discussions or social visits.
10.1 Travel Advice
If you are travelling to Singapore for business, check the Foreign and Commonwealth Office (FCO) travel advice beforehand.
Contact the Department for International Trade (DIT) team in Singapore for more information and advice on opportunities for doing business in Singapore.