Country Risk: Singapore

Upon independence in 1965, Singapore was faced with a lack of physical resources and a small domestic market. In response, the Singapore Government adopted a pro-business, pro-foreign investment, export-oriented economic policy framework, combined with state-directed investments in strategic government-owned corporations.

Singapore’s strategic location on major sea lanes, coupled with its pro export oriented policy framework, has allowed its small economy to be one of the most competitive and flexible in the world. The Singaporean economy has shown a high degree of resilience, recording solid economic growth rates. Owing to an efficient, well maintained business environment, Singapore has long benefited from vibrant entrepreneurial activity.

The country’s largely corruption-free government, skilled work force, and advanced, efficient infrastructure have attracted investments from more than 7,000 multinational corporations from the United States, Japan, and Europe.

The government hopes to establish a new growth path that will be less vulnerable to the global demand cycle for information technology products, and less vulnerable to a world economic downturn. It has succeeded in attracting major investments in pharmaceuticals and medical technology production while continuing efforts to establish Singapore as Southeast Asia’s financial and high-tech hub.

Foreign firms are found in almost all sectors of the economy. Multinational corporations account for more than two-thirds of manufacturing output and direct export sales, although certain services sectors remain dominated by government-linked companies.

Private Ownership: Foreign and local entities may readily establish, operate, and dispose of their own enterprises in Singapore. Except for representative offices (where foreign firms maintain a local representative but do not conduct commercial transactions in Singapore), there are no restrictions on carrying out remunerative activities.

Transparency of Regulatory System: Regulations are straightforward. Virtually all commercial operations are performed with transparency and speed.

Intellectual Property Rights: Singapore has developed one of the strongest intellectual property (IP) regimes in Asia. Singapore is a member of the WTO and a party to the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). It is a signatory to other international copyright agreements, including the Paris Convention, the Berne Convention, the Patent Cooperation Treaty, the Madrid Protocol, and the Budapest Treaty.

Singapore’s piracy rate averages about 5-10% for audio and video and 39% for business software. Software piracy levels in Singapore, while among the lowest in Asia, are almost double the estimated level in the United States. Rights holders have encountered difficulties when attempting to prosecute IP cases based on tips provided by company insiders. Singapore currently does not offer specific protection to “whistleblowers”. As a result, many informants refuse to provide crucial testimony in court.

U.S. industry has raised concerns that Internet piracy in Singapore is on the rise due to the increasing availability of the country’s broadband facilities.

Conversion and Transfer Policies: Singapore places no restrictions on reinvestment or repatriation of earnings and capital, and maintains no significant restrictions on remittances, foreign exchange transactions and capital movements.

Corruption: Corruption is almost nonexistent. Singapore has, and actively enforces, strong anti-corruption laws. When cases of corruption are uncovered, whether in the public or private sector, the government deals with them firmly, swiftly and publicly. Singapore is not a party to the OECD Convention on Combating Bribery, but the Prevention of Corruption Act makes it a crime for a Singapore citizen to bribe a foreign official or any other person, whether within or outside Singapore.

Economic Freedom: Singapore’s economic freedom score is 83.5, making its economy the number one freest in the 2024 Index of Economic Freedom. Singapore is ranked 1st out of 39 countries in the Asia-Pacific region, and its overall score is significantly higher than the world average.