What you need to know about Singapore
Singapore, well known for its Merlion, urbanized way of living, and a city-state of mixed cultures, is recognized globally as well as a business and trade hub of the world. Known as the home to most of the largest commodity trading companies in the world, of key materials such as oil, gas, steel, agri-commodities, metal and mining, this city-state, is the Asian centre for global commodities trading. Singapore’s GDP relies mainly on industries that are goods producing and services producing. The top services that Singapore offers to the world are business, finance and insurance and manufacturing services, and are dealing mainly with United States, Japan, and China. Singapore is known to be as the easiest place to do business in and has been labeled as an economy that is dynamic, free, innovative, and business-friendly, attracting more traders and investors in the city-state from Netherlands, Cayman Islands, and British Virgin Islands among others. The strong economy of Singapore, together with a government that is labeled as one of the least corrupts in the world, Singapore was able to establish itself as an essential playmaker in trade and business around the world.
What you need to know about China
Another economy giant, China, is also an essential playmaker in the world’s trading industries. Known to have the largest export economy in the world, China is exporting large amounts of computers, telephones, office machine parts, and cars. Like Singapore, China is trading with United States and Japan, and also adding Germany, Hong Kong, and South Korea in the list of trading partners. Yearly, China’s exports are significantly increasing, contributing largely in the country’s annual GDP. As a trading giant, China is able to export 558 products around the world, making their global share larger than what is expected from them by the globe and even larger than the size of a product’s global market. Advantageous in terms of land mass and demography, there is no wonder that China can produce more than what is needed and what the global market can cater to.
- China, advantageous in terms of demography and landmass, can provide employees to corporations and business that are low in cost, but are very skilled workers, who have the necessary skills and aptitudes to create products that are competitive in the global markets. On the other hand, given the fact that Singapore is highly urbanized city-state, the production cost doesn’t come any cheaper than what China can offer to the foreign investors. Lower transaction costs, in terms of physical and labor, is one of China’s key advantages that helps them attracts foreign investors throughout the year.
- Singapore provides a workforce that is productive, hard working, multicultural, and can speak very good English. Due to being a hotpot of cultures from around the world, the city-state can cater best to most nationalities. Singaporeans are more flexible in adapting and dealing with traders and businessmen of different nationalities. Singaporeans also are very competitive in terms of teaching mathematics to its students, hence, making them on of the most competitive in the market, in terms of businesses, financing, and other services producing industries. Their ability to speak very good English as well attracts more investors and traders because there is a very minimal language barrier among nationalities. On the other hand, this is particularly hard for those living in main land China. Since Chinese is their official language, there are lots of Chinese people who are not able to communicate well in English, which may be an issue to some foreign investors.
- Singapore is known for its generous tax incentives, extensive tax treat network, and low rates. They also rank third in the Asia Pacific with the lowest corporate tax rates, hence attracting more businesses and investors in the city-state. As investors gain more confidence in putting their money in a country, or in this case, a city-state, they are also more likely to put up more businesses and initiate trading further. Such as the case of Singapore, because of their stricter rule of law and intolerance towards corruption, investors have been leaning towards them in terms of putting up companies and investing to the city-state. Consequently, because of widespread corruption and non-progressive tax system of China, dissuasion of investors to invest in the county is not impossible.
- A green and healthy economy and environment – an initiative that the Chinese government has started to promote a healthier living environment to its people. According to recent reports, the Chinese government has been investing largely on this initiative to promote and implement rules and regulations to attain this objective. This can be beneficial and advantageous to enterprises with the same initiatives and mindset, attracting them more to invest in the country. On the other, modernization and smaller land mass hinder Singapore to promote the same initiative.
- Dubbed as the second most competitive economy in the world, merited to its government’s efficiency, financial market sophisticate, infrastructure, and lack of corruption among others, Singapore is able to cater best to foreign investors and traders. With a competitive economy, Singapore is able to enjoy the initiative and willingness of foreigners to put up their businesses and trading companies in the city-state, hence, creating the place as a global hub for commerce and business. On the other hand, political instability, corruption, inadequate amount of infrastructure, and leniency in the government are some of the things that are of China’s disadvantage when it comes to attracting investors and traders.
In conclusion, Singapore and China have their own advantages when it comes to trade and businesses. One has a government that acts a backbone of its economic advancement while the other can offer cheaper labor and transactional costs to prospect industries and investors. Evidently in the list though, Singapore is more advantageous for the trading industry as they house most of the trading companies of the key commodities of the world. Moreover, with the support from their government which strengthens their economic advancement against other countries, Singapore seems to be the favored economic hub for many. Although China can provide cheaper costs which can be very beneficial to companies who rely mainly on selling products, it is no doubt that the services of Singapore can offer, be it on finance, services, and manufacturing help them to be a leader when it comes to economic growth.