How To Play Singapore
Asia Correspondent Wendy Justice says, “Singapore is a delightful surprise in this part of the world for many reasons. It’s ultra-modern, clean, green, prosperous, and English-speaking. It is home to expats from around the globe, many working in the banking and finance industries, who enjoy a very high standard of living.
“Singapore is also expensive. The Economist Intelligence Unit’s 2009 report ranks Singapore as the third most expensive city in Asia (more affordable only than Tokyo and Osaka). Mercer ranks it as the 10th most expensive city in the world.
“Many who want to enjoy what Singapore has to offer, at least part-time, settle in Malaysia, where the guidelines for retirement are less stringent and where the cost of living is much lower. Singapore is just across the bridge from the Malaysian city of Johor Bahru, where budget-conscious expats can enjoy the best of both countries.
“In other words, I don’t recommend Singapore as one of the world’s top retirement havens. This country does, though, right now offer excellent opportunities for investment.
“Real estate prices in this small island nation are always at a premium, as new development and land use are controlled. With the current recession, home prices have dropped considerably, creating a rare buyers market. Direct real estate investment is not necessarily the play, though, and in this country you have an interesting option. You can invest instead in a REIT. These are offered by several regional banks and invest in the development of big high-rise condominium communities and new shopping centers.
“Singapore laws require that banks hold adequate reserves to cover their depositors and loans, making the risk of investing through a bank in Singapore significantly less than it is in many other countries. In addition, Singapore is consistently ranked as the least corrupt country in Asia and one of the 10 least corrupt countries in the world.
“Liberal banking laws allow foreigners to invest in Singaporean banks regardless of their residency status. Most banks require simply a letter of reference from your bank at home, copies of the last 12 months’ bank statements, and a copy of your passport. DBS, the largest bank in Singapore, currently offers fixed-deposit accounts in almost all major global currencies. There is no penalty for early withdrawal. Interest is credited monthly, and pulling funds out prematurely results only in forfeiture of the interest accrued in the current month. Interest and capital gains are exempt from Singaporean taxes–another benefit for foreign investors.”