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Country Commercial Guides for FY 2000: SingaporeReport prepared by U.S. Embassy Singapore, released July 1999
Note* |
Chapter X. Economic and Trade StatisticsAPPENDIX A: COUNTRY DATA
Estimate
1. PROFILE1995 1996 1997 Population, including nonresidents (mil.) 3.39 3.45 3.52 Population growth (%) 1.9 1.9 1.9 Major religions Christianity, Taoism, Buddhism, Islam, Hinduism Government System Unicameral parliament, universal suffrage with elections held every 5 years Official languages (in order of usage) English, Mandarin, Malay and TamilWork Week: 5 and 1/2 days (44 hours)APPENDIX B: DOMESTIC ECONOMY (1)
1995 1996 1 Qtr 1997 Exchange Rate 1.4174 1.4101 1.4451 GDP (US$ M at 1990 prices) 72423.0 77857.7 19211.8 GDP Growth Rate (percent) 8.8 7.0 3.8 GDP per capita (US$) 21757.0 26041.9 n.a Government Spending (pct of GDP) 12.8 14.5 26.4 Inflation (pct change in CPI) 1.7 1.4 1.7 Unemployment Rate (percent) 2.0 2.0 1.8 Forex Reserves (US$ M) 68672.6 76413.6 78887.2 Foreign Debt (US$ M) n/a n/a n/a Debt-Service Ratio n/a n/a n/a U.S. Economic / Military Assistance None None NoneNote: (1) All dollar figures were originally denominated in Singapore dollars. They were converted to U.S. dollars using exchange rates (averaged over each year) provided by the Monetary Authority of Singapore.APPENDIX C: TRADE (1) 1995 1996 Total Exports (US$ M) 118184.4 125006.0 Total Imports (US$ M) 124392.2 131326.4 Exports to U.S. (US$ M) 18560.5 20340.4 as pct of total exports 16% 17% Imports from U.S. (US$ M) 15333.2 16685.5 as pct. of total imports 13% 13% Trade Balance with U.S. (US$ M) 3227.3 3654.9 Trade Balance with Malaysia (US$ M) 3414.6 2790.5 Trade Balance with Japan (US$ M) -17089.2 -13589.1 Trade Balance with Hong Kong (US$ M) 6019.1 6925.7 Top 5 U.S. Exports to Singapore (US$ M): electronic equipment (disk drives, automated data processing machine parts, turbojets and parts, oil/ gas equip.) 4026.7 4658.4 electrical machinery and parts (microprocessors, wafers/chips, circuits, magnetic discs) 5254.3 5901.6 aircraft and parts 1271.4 1293.3 opt./photographic/meas. Devices 699.4 828.2 plastics/plastic articles 519.0 524.5 Top 5 U.S. Imports from Singapore (US$ M): automated data processing equipment (disk drives, printers, scanners, monitors) 11687.2 13565.2 electrical machinery and parts (wafers/chips, circuits, telecom equip., hi-fi, VCRs) 4325.0 4178.4 U.S. goods returned after partial assembly (electronics) 405.0 556.6 organic chemicals 557.0 521.9 opt./photo./measuring devices 382.4 354.3Notes: (1) All data reflects merchandise trade only; services are excluded.APPENDIX D: INVESTMENT STATISTICS
TABLE A
CUMULATIVE FOREIGN INVESTMENTS IN MANUFACTURING BY COUNTRY OF ORIGIN, 1994-1997
(Measured by Gross Fixed Assets)
US$ Millions
1994 1995 1996 1997 U.S. 7,937.7 9,468.0 10,529.7 12,773.4 Japan 7,069.5 8,461.3 9,100.8 9,932.0 Europe 6,124.1 6,845.6 6,819.4 8,056.3 EU 5,810.5 6,467.5 6,422.2 7,379.4 UK 2,019.8 2,331.0 2,158.7 2,250.8 Netherlands 2,482.7 2,609.0 2,653.0 3,432.8 Germany 542.8 667.4 787.2 887.0 France 421.6 508.0 477.3 458.0 Other EU Countries 343.1 352.1 346.1 350.2 Switzerland 211.5 258.9 283.7 569.1 Other European Countries 102.8 119.2 112.8 108.4 Other Countries1,276.0 1,580.4 1,511.2 1,515.4 Cumulative Foreign Investment 22,407.4 26,356.0 27,961.1 32,277.1Source: Economic Development Board
TABLE B
NET FOREIGN INVESTMENT COMMITMENTS IN MANUFACTURING BY COUNTRY OF ORIGIN, 1995-1998
US$ Millions1995 1996 1997 1998 U.S. 1,464.5 1,656.6 1,631.6 1,370.1 Japan 813.1 1,391.4 1,368.5 1,088.8 Europe 1,076.8 985.1 958.8 838.9 EU 1,065.9 936.5 941.8 526.3 UK 544.4 282.0 299.8 5.1 Netherlands 276.1 367.2 259.1 26.3 Germany 129.7 174.7 81.7 312.3 France 99.1 41.9 182.9 82.7 Italy 9.0 38.2 117.9 53.7 Sweden - - - 14.5 Other EU Countries 7.5 32.4 0.5 31.7 Switzerland 9.3 42.6 17.0 91.9 Other European Countries 1.6 6.0 - 3.2 Others Countries 69.0 74.3 57.6 34.9 Cumulative Foreign Investment 3,423.5 4,107.4 4,016.6 3,115.1Source: Economic Survey of Singapore, 1998TABLE C CUMULATIVE INVESTMENTS IN MANUFACTURING BY MAJOR INDUSTRY GROUP, 1994-1997
(Measured by Gross Fixed Assets)
US$ Millions
1994 1995 1996 1997 Food, Beverages & Tobacco 1,444.3 1,741.2 1,868.7 1,928.2 Textiles 152.5 149.6 148.9 130.0 Wearing Apparel 268.4 263.9 258.1 230.3 Leather Products & Footwear 35.4 36.7 27.7 35.7 Wood & Wood Products 93.6 98.1 93.6 92.9 Paper Products 570.9 612.4 635.4 639.1 Publishing & Printing 992.5 1,273.5 1,373.7 1,502.6 Refined Petroleum Products 5,669.1 6,011.7 6,379. 6,360.5 Chemicals & Chemical Products 3,533.5 4,273.3 4,423.8 8,095.4 Rubber & Plastics Products 1,011.5 1,259.3 1,365.2 1,452.0 Non-metallic Mineral ProductS 675.0 884.7 1,024.8 1,155.0 Basic Metal Industries 404.6 382.4 378.7 341.5 Fabricated Metal Products 2,005.4 2,339.5 2,619.7 2,755.3 Machinery & Equipment 2,297.4 2,633.0 2,928.2 2,957.3 Electrical Machinery & Apparatus 1,050.8 1,330.6 1,331.8 1,360.5 Electronic Products & Components 7,578.9 9,590.1 11,522.6 12,710.8 Instrumentation Equipment 536.9 615.2 668.0 639.1 Transport Equipment 2,269.2 2,594.2 2,661.5 2,500.7 Other Manufacturing Industries 538.8 601.1 548.2 546.2 TOTAL 31,128.7 36,760.3 40,257.4 45,462.7Source: Economic Development BoardTABLE D
NET INVESTMENT COMMITMENTS IN MANUFACTURING BY MAJOR INDUSTRY GROUP, 1995-1998
US$ Millions1995 1996 1997 1998 Food, Beverages & Tobacco 65.3 142.8 96.0 78.2 Textiles 2.3 1.6 - 6.1 Wearing Apparel - 7.2 0.3 - Leather & Footwear - 0.3 - - Wood & Wood Product - - - 11.6 Paper & Paper Products 13.1 2.0 2.0 21.3 Publishing & Printing 93.5 226.7 109. 36.4 Petroleum &Petroleum Products 837.0 76.8 391.5 15.8 Chemicals & Chemical Products 1,117.5 1,953.6 1,508.4 1,741.0 Rubber & Plastics Products 38.7 73.0 74.2 98.1 Non-metallic Mineral Products 30.4 59.9 57.7 19.2 Basic Metals 45.0 6.7 75.4 6.0 Fabricated Metal Products 196.5 248.6 246.9 207.5 Machinery & Equipment 233.5 217.2 218.0 266.2 Electrical Machinery & Apparatus 79.4 3.8 83.8 98.9 Electronic Products & Components 1,800.0 2,466.2 2,563.2 1,821.2 Instrumentation Equipment 34.9 58.6 47.2 26.4 Transport Equipment 209.2 177.6 242.4 213.6 Furniture & Other Manufacturing 7.5 11.5 - 10.6 TOTAL 4,803.9 5,733.7 5,716.9 4,678.2Source: Economic Survey of Singapore, 1998TABLE E
SINGAPORE'S DIRECT EQUITY INVESTMENT ABROAD BY COUNTRY OF DESTINATION, 1993-1996
US$ Millions1993 1994 1995 1996 Asia 7,022.3 1,364.4 16,413.2 17,355.5 ASEAN 3,683.4 6,337.6 9,166.8 9,482.3 Brunei 45.2 50.4 24.7 19.1 Indonesia 373.9 1,307.5 2,331.7 2,368.6 Malaysia 2,785.9 4,255.6 5,443.1 5,370.5 Philippines 121.8 250.1 436.7 616.3 Thailand 356.5 473.4 689.3 763.8 Vietnam* 42.2 83.1 241.3 344.7 Hong Kong 2,320.3 3,234.3 3,819.7 3,427.4 Taiwan 237.6 324.7 402.1 396.4 China 393.2 1,003.7 2,174.4 3,004.8 Japan 57.9 112.0 278.7 275.9 Others 287.7 269.7 572.9 768.7 Europe 944.5 1,440.4 2,726.8 3,672.8 Netherlands 301.0 296.6 317.5 312.0 U.K. 197.8 608.9 1,726.4 2,571.4 Others 445.7 535.6 683.6 789.3 Australia 351.6 654.1 886.8 934.0 U.S. 1,069.4 1,100.6 1,473.8 1,810.5 Other Countries 3,991.0 4,928.0 6,116.8 8,025.0 TOTAL 13,378.2 19,487.4 27,617.5 31,797.0* - With effect from 1995, Vietnam is included in Asean total
Source: Yearbook of Statistics, 1998TABLE F
TOP TEN FOREIGN INVESTORS IN SINGAPORE BY NATIONALITY (1997/1998)
UNITED STATES
COMPANY NAME TYPE OF BUSINESS TOTAL TOTAL ASSETS SALES (S$ Mil) (S$ Mil) J.P. Morgan Investment/ Securities Stockbroking 16,099 656 Mobil Oil Petroleum 3,435 3,553 Motorola Electronics Electronics 3,015 2,312 Compaq Asia Electronics 2,666 3,331 Compaq Holdings Electronics 2,368 102 Chase Manhattan Banking 2,303 143 Caltex Trading Trading (fuels) 1,729 16,901 Texas Instruments Electronics 1,551 3,893 DuPont Singapore Chemicals 1,455 622 Caltex Singapore Trading (fuels) 1,113 1,079JAPANCOMPANY NAME TYPE OF BUSINESS TOTAL TOTAL ASSETS SALES (S$ Mil) (S$ Mil) Nomura Singapore Banking 2,095 206 Fuji Xerox Services 1,557 1,331 Asia Matsushita Trading 1,554 6,065 Hitachi Asia Services 1,197 4,776 Sumitomo Coprn. Trading 936 4,417 Toshiba Capital Finance 896 4,982 Nissho Iwai Int'l Trading 845 857 Suntory Pacific Hotels/ Restaurants 590 651 Cerebos Pacific Food & Beverage 587 632 Asahi Techno Vision Electronics 553 369EUROPECOMPANY NAME TYPE OF BUSINESS TOTAL TOTAL ASSETS SALES (S$ Mil) (S$ Mil) Glaxo F.E., U.K. Finance 6,944 1,514 Glaxo Wellcome, U.K. Chemicals 5,448 1,491 Shell Eastern Petroleum, Netherlands Petroleum 3,366 5,452 Prudential Assurance, U.K. Insurance 2,754 1,161 BP Singapore, U.K. Petroleum 1,737 5,673 Danone Asia, France Food & Beverage 1,216 1,326 Shell Eastern Trading, Netherlands Petroleum 1,039 12,174 Inchape Motor, U.K. Trading 924 1,115 Siemens Components Germany Electronics 710 1,913 STMicro-electronics, Netherlands Electronics 678 3,305MALAYSIACOMPANY NAME TYPE OF BUSINESS TOTAL TOTAL ASSETS SALES (S$Mil) (S$Mil) Kuok Singapore Finance 4,082 829 Sime Singapore Services 553 660 Tan Chong & Sons Motor Trading (retail) 379 213 Pacific Carriers Transport/ Storage 354 114 Low Keng Huat Construction 325 161Note: a. The total assets and sales are for 1997/1998. The 1997 and 1998 exchange rates were S$1.4848 and S$1.6736 per US$1 respectively.Source: "The Singapore 1000, 1998/99", Datapool (S) Pte. Ltd.
Summary of Main Singapore Government Investment Incentives
Incentives Administered by the Economic Development Board (EDB): A) Pioneer Status: new manufacturing and service investments introducing high-tech skills can enjoy complete exemption from the 26 percent corporate tax on profits for five to ten years.
B) Development & Expansion Incentive: this incentive replaces the post-pioneer incentive. Firms that engage in new projects, expand or upgrade operations in Singapore which result in significant economic spin-offs are eligible for a concessionary tax rate of 13 percent for up to 10 years with provision for extension.
C) Investment Allowance Incentive: companies engaged in qualifying activities (for example, manufacturing research and development activities, construction or projects to reduce consumption of water) are eligible for exemption of taxable income equal to a specified proportion (up to 50 percent) of new fixed investment. The exempted firms must make the specified investments within five years.
D) Approved Foreign Loan Scheme: a company that takes a minimum loan of SGD 200,000 (US$143,000) from a foreign lender to purchase productive equipment will be wholly or partially exempt from withholding tax on the interest payable to the lender. This is subject usually to the condition that the tax relief does not result in an increase in tax liability in the foreign country.
E) Approved Royalties: full or partial exemption of withholding tax on royalties is given to eligible companies, subject usually to the condition that the tax relief does not result in an increase in tax liability in the foreign country.
F) Venture Capital Incentive: companies with at least 50 percent local equity content and incorporated in Singapore for tax purposes that invest in approved new technology projects are eligible for this incentive. Losses incurred from the sale of shares of up to 100 percent of equity invested can be set off against the investor's other taxable income.
G) Overseas Investment Incentive: companies eligible for this incentive must be involved in investments in overseas projects. The companies must be 50 percent owned by Singapore citizens or permanent residents, and must be incorporated and resident in Singapore for tax purposes. These companies can offset losses incurred from the sale of shares or liquidation of up to 100 percent of equity invested overseas, against their other taxable income.
H) Operational Headquarters (OHQ) Incentive: entities providing management and other approved headquarters-related services to subsidiary, associated, or related companies in other countries are taxed at the concessionary corporate rate of 10 percent (global HQs are eligible for full tax exemption). The incentive is given for up to 10 years with provision for extension.
I) Accelerated Depreciation Allowances: in lieu of the normal initial depreciation allowance of 20 percent and annual allowance of between 5 to 20 percent on capital expenditure, companies can claim an annual depreciation allowance of 33 1/3 percent over three years for all plants and machinery. They may also claim 100 percent in one year for prescribed automation equipment, robots and certain environmental-related equipment (eg, energy-saving equipment). Industrial buildings may be depreciated over 25 years.
J) Overseas Enterprise Incentive: exemption of corporate tax on qualifying income earned from approved overseas investments and projects is granted for up to ten years. Companies must be at least 50 percent owned by Singapore citizens or Singapore permanent residents, and incorporated and resident in Singapore for tax purposes..
K) Business Headquarters (BHQ) Status: may be awarded to eligible companies in manufacturing and service activities which qualify for an incentive under the economic expansion incentives act and which provide business and professional expertise, business and management direction and key support services to companies in the region. Period varies depending on the incentive granted.
L) Double Deduction for Research and Development (R&D) Expenses: applicable to manufacturing and service activities engaged in R&D. The project must be carried out in Singapore. Double deduction allowed for qualifying R&D expenses against income.
M) Double Deduction for Overseas Investment Development Expenditure: eligible manufacturing and business activities can enjoy double deduction for qualifying expenditure incurred in approved feasibility studies and maintenance of overseas project offices against income.
N) Research and Development (R&D) Assistance Scheme: grants can be offered to support specific projects on product or process R&D which lead to the enhancement of the company's competitiveness and in-house capability development.
O) Research Incentive Scheme for Companies: under this scheme, grants may be offered to support the development of in-house R&D capabilities among Singapore-based companies.
Incentives Administered by the Trade Development Board (TDB)
A) Pioneer Status Scheme for Counter Trade: companies that engage solely in counter trade, performing at least one segment of each transaction through Singapore, can obtain pioneer status. This status gives full exemption of income tax on profits arising from counter trade for a period of five years, and it may be extended.
B) Approved Oil Trader (AOT) Incentive: the AOT incentive aims at facilitating and expanding international oil trading activities in Singapore. Applicants should be established oil traders with good worldwide networks, strong track records and conduct a substantial volume of physical trade on a principal basis. Approved oil traders will be taxed at a concessionary tax rate of 10 percent on income derived from international trading activities in approved oil products. The concession is for five years with a provision for renewal.
C) Approved International Trader (AIT) Incentive: conditions for the AIT scheme are similar to the AOT. The difference is that the AIT offers a concessionary tax rate of 10 percent on income derived from international trading activities in approved non-petroleum commodities and products.
D) Approved International Shipping Enterprise (AIS) Incentive: international shipping companies which establish operations in Singapore can qualify for the incentive. The qualifying income includes those derived from operation of non-Singapore vessels outside Singapore.
E) Approved Aircraft Leasing Incentive: under this incentive, approved aircraft operating lessors will enjoy a concessionary tax rate on income derived from offshore aircraft leasing operations.
F) Approved Cyber Trader (ACT) Incentive: the ACT incentive is aimed at promoting Singapore as the region's e-commerce hub by anchoring e-commerce core players in Singapore and helping local companies to expand into the region. Companies with e-commerce operations in Singapore and provide e-commerce solutions from the country will enjoy a concessionary tax incentive of 10 percent on offshore income derived from transactions over the internet for up to five years.
Incentives Administered by the Monetary Authority of Singapore (MAS)
A) Tax Incentive Scheme for Asian Currency Unit (ACU) Income: the scheme is aimed at encouraging banks and merchant banks to undertake offshore banking activities with non-residents and provides a concessionary tax rate of 10 per cent on income earned from such activities.
B) Tax Exemption Scheme for Syndicated Facilities: tax exemption is extended to all facilities denominated in any currency that are syndicated by banks, merchant banks or Approved Securities Companies in Singapore for Singapore resident borrowers. However, to qualify, the proceeds raised from the syndicated facilities must be used outside Singapore, and any allowable expenses are deducted only against foreign-sourced income.
C) Double Tax Deduction Scheme for Financial Research and Development: this incentive, designed to encourage financial institutions in Singapore to develop new and innovative financial products, allows double tax deduction for expenses such as the cost of R&D personnel, legal expenses, training costs and consultancy fees.
D) Tax Exemption Scheme for Fund Management: the scheme provides a concessionary tax rate of 10 percent on fee income to fund management companies. Tax holidays will also be granted to fund managers who manage more than S$5.0 billion (about US$2.9 billion) of foreign funds in Singapore. Investment income earned by foreign investors are also exempt from Singapore tax.
E) Tax Incentive Scheme for Bond Market Activities: to encourage a vibrant bond market, fee income from arranging, underwriting and distributing debt securities will enjoy a tax holiday; interest income from holding debt securities will be taxed at 10 percent; interest from debt securities payable to non-residents without permanent establishments in Singapore will be exempted from witholding tax; and income from trading in debt securities will be taxed at 10 percent.
F) Tax Incentive Scheme for Credit Rating Agencies: to encourage credit rating agencies to set up operations in Singapore, this incentive provides a concessionary tax rate of 10 per cent on income from the provision of credit rating services for foreign securities.
G) Tax Incentive Scheme for Transactions in Foreign Securities: to encourage regional securities trading activities, income from transactions in foreign securities and from providing services with respect to foreign securities will be taxed at 10 percent. Income from arranging and underwriting initial public offerings (IPOs) of foreign currency-denominated shares on the Singapore stock exchange (SES), and from transactions in foreign securities listed on the SES are exempted from tax.
H) Tax Incentive Scheme for Foreign Securities Lending and Borrowing: designed to promote the lending and borrowing of foreign securities, a concessionary tax rate of 10 percent will apply to net income from loans of foreign securities to eligible parties, and to income from arranging such loans. Withholding tax exemption on loan fees, manufactured dividends, or interest paid in respect of a loan of foreign securities, and exemption of stamp duty on the loan contract are also provided under the scheme.
I) Tax Incentive for Approved Trustee Companies: companies and financial institutions will enjoy a concessionary tax rate of 10 percent on selected income streams from trustee and custodian services offered in Singapore. Investment income generated by the trusts is also exempted from tax.
J) Tax Incentive Scheme for Operational Headquarters: the scheme allows financial institutions with substantial international operations a concessionary tax rate of 10 per cent on income derived from providing qualifying headquarters services to overseas related companies and on income derived from treasury activities.
K) Tax Incentive Scheme for Finance and Treasury Centers: to encourage MNC's to use Singapore as a base for conducting treasury management activities, this incentive provides a concessionary tax rate of 10 per cent on income derived from provision of finance and treasury services to related companies. Interest payments on foreign loans obtained from overseas banks or related companies may also be exempted from withholding tax.
L) Tax Incentive Scheme for Offshore Insurance Business: a concessionary tax rate of 10 per cent can be granted to insurance companies on income derived from writing offshore insurance business.
M) Initiatives in New Technology Scheme (INTECH): to encourage the development of manpower resources in the insurance industry, this incentive provides a financial grant to registered insurers, reinsurers and approved captive managers in Singapore to help defray the cost of manpower training.
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[end of document] Note* International Copyright, United States Government, 1998 (or other year of first publication). All rights under foreign copyright laws are reserved. All portions of this publication are protected against any type or form of reproduction, communications to the public and the preparation of adaptations, arrangement and alterations outside the United States. U. S. copyright is not asserted under the U.S. Copyright Law, Title17, United States Code.
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