Not only in Asia, even in the global context, Singapore’s commercial competitiveness is also among the best. According to the World Bank’s 2012 Business Environment Report, Singapore is the world’s easiest place to do business on Freeport.
As a country where there is no tariff, Singapore’s free trade ranks at the top of the world. The island nation, which is located in the center of Southeast Asia, has now become an important channel for world trade.
In 1969, Singapore in the Jurong Industrial Zone Jurong pier designated the first free trade zone, and now Singapore has gradually developed into a highly open trade free port. There are currently eight free trade zones in Singapore, which are managed by Singapore Port Group Limited, Jurong Harbor Sdn Bhd and Changi Airport Group respectively.
Free zones and tax incentives
In addition to alcohol, tobacco, petroleum products and motor vehicles of these four products, Singapore does not impose tariffs on imported goods. Which is out of practical considerations. Speaking at an exclusive interview with the 21st century economic report, Lin Ruiqian, Assistant Secretary for Economic Development of Singapore, said that after independence, Singapore decided to industrialize, but they also realized that tariffs did not protect Singapore’s domestic enterprises.
“Our domestic market is too small, a function of tariffs is a sufficient market, but in the sixties and seventies of last century, Singapore’s population is only two million, even if the tariffs are no way to protect the domestic enterprises Can grow up effectively, “he said.
As a result, Singapore has decided to develop major industries that are internationally competitive and able to achieve their exports when developing their industries. In this process, Singapore has also accelerated the pace of development of foreign trade. Have set up eight free trade zones.
Singapore’s free trade zone does not rely on tax incentives to attract foreign investment in manufacturing and manufacturing base, but mainly to provide a free zone. According to the Singapore Port Group Co., Ltd. to provide information to the newspaper, the Singapore FTA policy, when the goods first imported into the Singapore Free Trade Area can be temporarily exempt from consumption tax. Only in the product into the customs area, in the domestic market in Singapore will be charged when the consumption tax. This overpayment is particularly advantageous for importers, since all imports to Singapore are subject to a consumption tax.
In view of the small domestic demand in Singapore, more than 80% of the goods imported into Singapore will eventually be exported to the rest of the world. As an important area of entrepot trade, the free trade area delineated by Singapore provides a free zone for companies that use Singapore as a re-export company. In the free trade area, businesses can store, modify, sort and re-export products.
In contrast, if the company does not use the free trade area, will not enjoy the payment of consumption tax. When they re-export to places outside of Singapore, although they can apply for a refund of the previously paid consumption tax, this will undoubtedly increase the time and money costs.
The GST is only one of the policy advantages of the Singapore FTA. Another notable advantage is its geographical location, proximity to the harbor and the airport.
Of the eight existing free trade fairs in Singapore, Singapore Port Group Limited has five divisions, namely the Blagne Cargo Terminal, the Ciba Dispatch, the Brazilian Class Let the Cargo Terminal, the Sembawang Wharf and the Dan Velvet carp cargo distribution center and the bus stop. Jurong Harbor is managed by Jurong Harbor Sdn Bhd.
The other two free trade areas are located near the airport, which are Singapore Airport Logistics Park and Changi Airport Air Cargo Center. The two free trade zones are managed by the Changi Airport Group accordingly.
The efficiency of the connection between the Singapore harbor and the airport and the outside world has increased the efficiency of these free trade areas. On the port side, Singapore has established contacts with more than 600 ports in more than 120 countries and regions worldwide. Every two to three minutes, there is a ship arriving or leaving the port of Singapore. Singapore Changi Airport is an important aviation hub in Asia, Changi Airport to fly to about 60 countries and regions, more than 220 cities in more than 100 international airlines to provide services. As the world’s seventh largest busy international airport, every 100 seconds there is a flight at Changi Airport takeoff or landing.
In order to maintain its competitiveness in logistics, Singapore is still expanding its infrastructure. The Brazilian class in the southwestern part of Singapore is one of the busiest ports in the world, and its capacity is now approaching its limit.
Singapore Prime Minister Lee Hsien Loong delivered a speech during the 2013 National Day meeting, said Singapore is expanding the harbor, is expected to be completed by 2027
Into the construction of the new port of Cheshire. At the industrial center near Singapore, the port throughput is almost double that of existing Singapore International Port Group’s throughput capacity.
“We have now begun to expand our harbor, the current harbor from the city center to the Tashi, where there is a greater place, you can make more ships at the same time loading, unloading, and thus further improve our ability to load and unload And efficiency. “Lin said the year.
Multinational logistics company regional headquarters
Keeping the logistics efficient is the key to Singapore’s becoming a trade center. “Singapore is committed to being an efficient logistics center that can quickly reach the point where it is going to go when it arrives in Singapore by shipping or air transport, which is related to the efficiency of the harbor or airport operations.” Singapore Economic Development Bureau Assistant Secretary Lin Ruian said.
In order to facilitate the facilitation of trade, as early as 1989, the Singapore government in the world to take the lead in the development of trade management electronic platform trade network, customs, tax, security and other 35 government agencies connected to a network for enterprises to provide one-stop customs clearance service. In this unified system, companies only need to submit an electronic file, and import and export trade related to all the declaration and audit procedures can be completed within the network, the fastest can be completed within 10 seconds of customs clearance.
These conveniences have led to the rapid development of logistics in Singapore, attracting more multinational companies to set up regional headquarters in the Asia-Pacific region. Singapore has also become the world’s major logistics company’s location, in the world’s top 25 logistics companies in 20 to start business in Singapore, including DHL, Dexun, Shan Nine Air, Cink Logistics and other companies in Singapore set up regional or global headquarters.
Last year, FedEx also invested $ 97 million to build an air fast cargo center at Changi Airport, which is FedEx’s largest integrated facility in Asia Pacific, where products from Australia, New Zealand and Southeast Asia can be transported to complete air, ground and customs clearance program.
Signed a free trade agreement
As an important part of the Singapore trading system, Singapore has signed more than 20 free trade agreements with various regions and countries in the world, including China, the United States, ASEAN, New Zealand, India and Japan. Singapore’s latest entry into force of a FTA is signed with the GCC, which is the first free trade agreement signed between the GCC and other countries or regions. Singapore is also currently involved in cross-Pacific partnership agreements and regional comprehensive economic partnership negotiations.
Based on these FTAs, Singapore-based exporters and investors can enjoy multiple benefits such as tariff concessions, prioritization in specific areas, faster access to markets and access to intellectual property protection.
“After signing FTA, when these companies through the export of their products or services in Singapore, you can enjoy a more special treatment, such as relatively low tariffs, in some places can even avoid tariffs, thereby increasing the company in the product or service On the competitiveness. “Lin said the year.
In addition, Singapore has signed 30 investment guarantee agreements and 50 to avoid double taxation agreement, so that the choice of Singapore in the multinational business of the headquarters company, enjoy the tax advantage.
In order to facilitate enterprises to invest in Singapore, Singapore has set up a special economic development bureau. The council is responsible for providing investment services and support to enterprises. Singapore Economic Development Bureau Assistant Secretary Lin said that if an enterprise wants to invest in Singapore, you can communicate with the officials of the Council. After understanding the content, size, and key technical factors of the project, it can determine what support can be provided, which can subsidize the business, or provide special tax concessions.