February 28, 2014 | Valerie Wong
When it comes to setting up investments in Singapore as a foreigner, it's important to remember that SOPs and proper protocols must be observed. Standard operating procedures when it comes to Singapore investment and establishment of startups involves a lot of paperwork, which is something no one enjoys. With that said, it's a necessary "evil" in all countries, not just Singapore. The specific bureaucratic requirements of Singapore investors are as follows: A Singaporean VISA, an awareness of the different entrepreneurial opportunities available to you as a foreigner, and defining from the get go what you want to invest in. You can't just "invest" in a country without having a clear idea of what to invest in.
The Investment Opportunities Available to You in Singapore
As any expatriate in the know would tell you, the easiest method in Singaporean investing is doing so with ETFs or exchange-traded funds. This provides exposure that's diversified in a single U.S.-traded security. For your information, you can get a hold of a net asset value of more than $1.5 billion (as of October 2012) from the most popular Singaporean ETFs (specifically the iSharesMSCI Singapore Index Fund or EWS). Industrial and financial companies heavily weigh ETF since the country is primarily a trade destination, with the financial side of things offering 47.14% and the industrial side of things 26.29%.
Investors intending to make ETF investments in Singapore should remember that there's added risk thanks to the overweight position of the ETF, especially during circumstances involving the straining of the financial system. Of course, as far as investors are concerned, the risk is all part of the proverbial dance. With that said, the three largest holdings you can invest in includes United Overseas Bank Ltd. (9.93% share), DBS Group Holdings Ltd. (10.3% share) and Singapore Telecom Ltd. (10.57%). You may also start small and invest in minor instead of major companies, or establish a startup of your own.
Other Avenues Towards Entrepreneurial Success in Singapore
Restaurants, hotels, and textile are just some of the worthwhile businesses you can invest in while in Singaporean soil. The stock market and certain companies are also other avenues of interest. You can be a shareholder of the Singaporean equivalent of Target, McDonalds, or Polo, for example. With that said, in order to know which Singaporean market or "basket" you're supposed to put your eggs in, you should learn what the Singaporean audience wants. Even if you're not off to establish your own business in Singapore and would rather invest in preexisting markets, you should still have a good idea how the Singapore market works.
As far as local business creation in Singapore is concerned, it's all about location, location, location. The whims, attitudes, culture, and buying behavior of the Singaporean locals will dictate, for example, how well a company you've invested in will prosper or falter. International competition might also serve as a factor as far as you, the foreign investor, is concerned, because if you want to play it safe, you can do as the more successful crop of foreign investors are doing in order to make your profits. Whether you're entering the electronics or clothes distribution industry, it pays to learn about trade and distribution in the country.
If you want to start a Singaporean business, you can always depend on Servcorp. They have quality corporate registration and virtual office solutions that will give you a run for your money when it comes to establishing yourself in Singapore.