Wednesday, November 19, 2008

4th Best Place To Invest In

Source : The Straits Times, Nov 19, 2008

THE global economy may be slowing, but Singapore is still one of top four places to invest in over the next five years, a survey of 260 global companies in 12 economies has found.

Singapore is still one of top four places to invest in over the next five years, a survey of 260 global companies in 12 economies has found. --PHOTO: SINGAPORE GP

The study, which was conducted in September and October and released on Wednesday by KPMG, ranked Singapore ahead of Hong Kong, and just behind China, the United States and India in terms of where companies would want to invest in.

Among the factors, companies highlighted Singapore's political stability, impartial rule of law, friendly tax regime and access to new customers as 'very important' when deciding to invest here.

However, the findings also showed that companies want the Singapore Government to do more to attract foreign talent and to lower taxes for businesses.

Mr Owi Kek Hean, KPMG's head of tax services in Singapore, said: 'We wanted to compare and contrast what businesses would like to see from the countries when deciding where to locate their operations.'

This is the first survey by KPMG on the importance of tax and demographics in influencing corporate location, which also tracks the investment decisions of companies over the next five years.

The survey includes responses from 20 Singapore-based multinational companies (MNC), each with a turnover of US$1 billion.

Mr Phillip Overmyer, the chief executive of the Singapore International Chamber of Commerce said of the results: 'That people are saying this is not earth-shattering, but the importance is in the timing of it.

'MNCs have said they want to make investments in the next two years, in the middle of the financial crisis we are in, and that these are the places they are going out of all the places in the world.'

'It confirms that people think Asia is the market of the future, that it will recover very early and it reinforces very strongly that Singapore will play a critical role in this development in Asia as the crisis starts to resolve itself.'

Mr Owi said what stood out for him was that Singapore businesses would like to see more tax incentives as well as looser restrictions on foreign workers.

In fact 70 per cent of respondents said that tax regime is an important factor in choosing where to locate their business, he said.

Another half of all respondents indicated that the tax policy of a country is more important than an educated workforce in deciding where to locate their business operations.

The survey also revealed that 65 per cent of respondents here look to the Goverment to work together with them to attract foreign talent. This is unlike in Europe where companies feel that attracting foreign talent is their own repsonsibility.

Mr Owi said: 'This shows that the expectations here is for a partnership between the Government and companies to bring in foreign talent.'

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