Why is Singapore the Ideal Destination for a Fund Manager?

Singapore is more than just a global financial hub; it is a genuinely vibrant, world-class metropolis offering unparalleled opportunities for fund and asset managers.

Dubbed the “Lion City”, this now ultra-modern city-state combines strategic advantages such as its prime geographical location, robust legal framework, and attractive tax regime with exceptional living standards, advanced infrastructure, and a skilled workforce.

Beyond the professional benefits, Singapore’s high quality of life, excellent healthcare, and metropolitan cultural scene make it a world-class city to call home. This article explores why Singapore is the ideal destination for any fund manager seeking lucrative career prospects.

Singapore’s Strategic Geographical Location for a Fund Manager

Singapore’s prime geographical location truly sets it apart as a hub for global finance. Set at the crossroads of West and East, Singapore is perfectly positioned to promote business across Asia and beyond. This strategic placement is consequently a boon for fund and asset managers looking to tap into the immense growth potential of the region.

The Association of Southeast Asian Nations (ASEAN), which includes Singapore, boasts the fifth-largest GDP globally, trailing only the US, China, Japan and Germany. For those looking to the future, ASEAN’s GDP is predicted to be an estimated $4.5 trillion by the year 2030, making it the world’s fourth-largest economy.

This economic bloc clearly offers an expanding market for foreign investment opportunities, with Singapore an ideal base for these high-growth economies. Singapore’s international connectivity is another significant advantage.

With access to over three billion people within a six-hour flight radius, a fund manager can easily reach key markets across Asia-Pacific. This close connection eases business operations and provides ample opportunities for in-person networking and client engagements.

Whether it is the bustling financial centres of Hong Kong and Tokyo or the emerging markets of Southeast Asia, Singapore’s location offers unparalleled access. This geographical advantage, combined with the city-state’s comprehensive transport links and world-class infrastructure, makes Singapore an unbeatable destination for fund and asset managers looking to expand their reach and capitalise on the region’s economic potential.

Singapore’s Robust Legal and Regulatory Framework for Fund Management

Singapore’s famously robust legal and regulatory framework is the foundation of its appeal as a global financial hub. The city-state’s commitment to maintaining high governance and regulatory quality standards provides a secure and predictable environment for financial operations, which is crucial for high-performing fund and asset managers.

Singapore’s outstanding performance in global governance rankings clearly demonstrates this commitment. The country ranks in the 99th percentile for Control of Corruption and in the 100th percentile for Government Effectiveness.

Another significant advantage is Singapore’s banking secrecy laws, which provide additional security for financial transactions. This, coupled with a reliable English common law system, ensures that financial institutions can operate within a framework that is stable and transparent.

Singapore’s monetary policies are also highly favourable for international business. The absence of foreign exchange controls means that fund and asset managers can move capital freely, without the restrictions that are common in other jurisdictions.

The freely convertible Singapore dollar (in the top ten most traded currencies in the world) adds another layer of convenience, offering smooth and efficient financial transactions across borders.

Singapore’s Attractive Tax Regime for Asset and Fund Managers

Singapore’s tax regime is specifically designed to attract and retain global businesses, making it exceptionally appealing to fund and asset managers. One of the standout features of Singapore’s tax system is its extensive network of double taxation agreements (DTAs).

The country has DTAs with 106 countries, significantly reducing withholding tax burdens and eliminating double taxation on cross-border transactions. This ensures that businesses can operate with greater certainty and efficiency, minimising tax liabilities and maximising profitability.

In addition to DTAs, Singapore has also signed numerous free trade agreements (FTAs) covering about 60% of the world’s GDP. Most notably perhaps, is that Singapore is a member of The Regional Comprehensive Economic Partnership (RCEP), whose signatories make up 30% of the global GDP, making it the world’s largest trading bloc.

For fund and asset managers, this means easier access to a broader range of investment opportunities and markets, enhancing the potential for growth and diversification.

Singapore’s Supportive Government Policies for Asset and Fund Managers

Singapore’s government has implemented a range of forward-thinking policies that create a brilliant environment for the financial services sector. These policies support the growth and innovation of fund and asset management firms and enhance Singapore’s reputation as a leading global financial hub.

One notable initiative is the introduction of the Variable Capital Company (VCC) framework. The VCC framework allows for both open-ended and closed-ended fund structures, providing flexibility in share issuance and redemption. It enables multiple sub-funds to be housed under a single corporate entity, reducing operational costs and administrative burdens.

The Monetary Authority of Singapore (MAS) has also played a pivotal role in fostering a supportive environment for the financial sector. MAS has launched various fintech initiatives and regulatory sandboxes, encouraging innovation and growth within the industry. Examples include:

• FinTech Regulatory Sandbox: Allows financial institutions and fintech players to experiment with innovative financial products and services in a controlled environment with regulatory support.
• Financial Sector Technology and Innovation (FSTI) Scheme: Provides funding support for the creation and adoption of innovative technologies in the financial sector.
• Innovation Hub: A 100,000-square-foot fintech innovation hub has been built in the Central Area of Singapore, designed to encourage experimentation in the sector.

MAS has already invested S$225 million in incentives for fintech companies to operate and flourish in Singapore. These measures combine to create a favourable business environment that attracts global financial firms and encourages their long-term growth and success in Singapore.

Where to Next With InCorp for Asset and Fund Managers

Singapore stands out as the ideal destination for fund and asset managers, offering a unique blend of professional opportunities and exceptional living standards. Its strategic geographical location, robust legal framework, attractive tax regime, advanced infrastructure, and skilled workforce create an environment conducive to business growth and innovation.

In terms of lifestyle, the city-state’s high quality of life, excellent healthcare, and vibrant cultural scene make it a wonderful place to call home. For those looking to maximise their professional potential while enjoying a balanced and enriching lifestyle, Singapore is the perfect choice.

To learn more about how Singapore can benefit your business and lifestyle, contact InCorp for personalised insights and guidance.

About the Author

Alton Neo

Alton has deep technical expertise in the Singapore Financial Reporting Standards as well as hands-on experience in accounting for publicly-listed entities and growing enterprises in Singapore. Beyond that, Alton also provides expertise to fund managers and family offices on structuring.

More on Business Blogs