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More affluent consumers, stable government among reasons Singapore attracts investors

“Global business leaders are evidently cognisant about the growth and transformation taking place within Asia, and the untapped potential that remains,” said Mr Sidharta Sircar, a partner in PwC Singapore’s International Growth Practice.

Asia’s economic prominence often contrasts with the more modest role it plays in global investor portfolios, said Mr Bill Maldonado, chief investment officer and interim chief executive officer at Eastspring Investments.

“With each Asian market at different stages of growth and given how diverse and complex local markets can be, it is crucial investors understand the nuances to unlock Asia’s differentiated alpha opportunities,” he added.

SINGAPORE – A stable government and a business-friendly environment are two reasons that Singapore attracts foreign investments and drives domestic growth.

The country’s geographical location also allows it to be well-integrated across the Asean region.

These findings were reported in a new white paper by asset manager Eastspring Investments and PwC Singapore, titled Asia 2.0: Investing In An Era Of New Opportunities.

The white paper is based on a global survey of 100 C-suite business leaders of international corporations across multiple industries and interviews with senior executives from some of Asia’s leading companies. It examines the impact of key transformations across Asian markets and the opportunities that will emerge for investors.

Another strength of Singapore, according to the white paper, is its growing consumer base with higher spending power. Annual disposable income per capita in Singapore rose from US$23,000 (S$30,470) in 2010 to US$28,000 in 2020, and is expected to reach US$47,000 by 2030.

Foreign direct investment inflows to Singapore grew from US$57 billion in 2010 to US$75 billion in 2020. Meanwhile, Singapore’s gross domestic product grew from US$236 billion to US$345 billion over the same period.

Singapore remains a leading trade centre – 47 per cent of business leaders surveyed have their regional or international corporate headquarters in the city, while 29 per cent of them have a regional logistics hub based in Singapore.

Singapore was ranked Asia’s top financial centre and third in the world in 2022, according to the Global Financial Centres Index.

The white paper also said that the focus on sustainability is increasing, with 57 per cent of business leaders indicating that their choice of suppliers will be determined by ESG considerations.

Other findings include the expansion potential of countries. Some 67 per cent of the global business leaders surveyed believe India has the highest potential as businesses seek to expand and develop within Asia. This is closely followed by China (57 per cent) and Indonesia (38 per cent).

Most business leaders surveyed (77 per cent) said they are looking to Asia for expansion or transformation opportunities, primarily because of the region’s expanding and evolving consumer base.

Given Asia’s rapidly increasing Internet penetration, the rise in mobile and live streaming e-commerce is expected to generate new channels of consumption and opportunities.

In the survey, 62 per cent of business leaders cited the following key factors in supporting Asia’s future transformation and their longer-term business ambitions in the region: improvements in physical and digital infrastructure, advancements in workforce skill sets, and supportive government policies and incentives.