Bilateral Trade Eases Singapore Company Incorporation
Small and medium entrepreneurs who are looking into starting a trading business in the region would find Singapore as a great choice for establishing their regional headquarters. Based on an Ernst and Young report titled Beyond Asia: New Patterns of Trade, Singapore ranks first on the list of Asia Pacific countries with the greatest number of bilateral free trade agreements with other countries—a total of 18, to be more specific.
The report has also taken into account the significant growth opportunities for Asian trade stating that “the trend toward cross-regional agreements has become even stronger recently, indicating that Asia-Pacific continues its outward trade trend.” With regards to economic freedom, Singapore continues to headline other Asian countries as compared to another known neighboring business hub, Hong Kong, which has only inked two bilateral free trade agreements in recent years.
Singapore has already inked a number of free trade agreements with global economies such as the European Union, China, Japan, South Korea, India and Australia. This has been one of the many reasons why the World Economic Forum (WEF) has hailed Singapore as the “Country Most Open to International Trade.”
Bilateral free trade agreements eliminate tariffs and restrictive policies on the flow of goods and services between countries, saving companies thousands of dollars in the export and import process. Also, every time a company does trade between countries, its market share, profit, and reputation is always on the line. But with free trade, companies no longer have to face such challenges, ultimately having a positive effect on trading.
Singapore offers tax incentives for companies engaged in trading in the country. In fact, trading companies can get as much as a five to 10 percent tax incentives under the state’s Global Trader Program. As for non-trading companies, Singapore also offers an attractive headline corporate tax rate of only 17 percent.