Numerous factors contribute to the success of a business, with the company’s location often being the foremost consideration for investors and entrepreneurs. In today’s business landscape, the Asia Pacific region stands out as one of the most crucial areas globally. According to HSBC research, developing economies are projected to drive approximately 70% of future global growth.
Asia encompasses the world’s largest and most diverse continent. It hosts advanced infrastructure, leading innovation hubs, and densely populated emerging markets. Over the past three decades, the continent has experienced a remarkable technological surge, with GDP growth in many nations surpassing that of Western markets. Consequently, expanding into Asia has emerged as a primary objective for companies aiming to extend their global footprint.
In this article, we explore the five best cities in Asia to launch a business, each offering a favorable business environment and a plethora of enticing opportunities.
Singapore (Singapore) 🇸🇬
Singapore stands out as one of Asia’s most appealing markets, securing second place in the 2020 Ease of Doing Business report. Situated at the heart of Southeast Asia, Singapore offers abundant investment opportunities and robust trade prospects for foreign corporations.
To facilitate continuous foreign investment, the Singapore government has inked 21 free trade agreements (FTAs) and 76 comprehensive avoidance of double taxation agreements (DTAs) with 27 nations. These agreements streamline business operations and international trade by reducing tax and tariff barriers, sharing technological expertise, and fostering experience exchange.
Coupled with a flat corporate tax rate of 17%, tax exemptions of up to SGD 125,000 for new ventures, low personal income taxes, and a legal system based on English common law inherited from its colonial past, Singapore emerges as a highly attractive destination for business expansion in Asia.
Singapore’s robust legal framework is underscored by its ranking as second in the world and first in Asia for refined intellectual property (IP) protection by the World Economic Forum (WEF). Additionally, with the Singapore International Arbitration Centre ranking second globally, Singapore is recognized as a leading arbitration destination, following only Lausanne.
Boasting a burgeoning pool of global talent, Singapore’s multilingual workforce and a hiring culture that ranks third in the 2020 Global Talent Competitiveness Index further enhance its appeal as a business hub.
Moreover, while the world average time to start a business is 20 days, Singapore’s average is a mere two days. This swift process underscores Singapore’s attractiveness as a prime location to initiate business ventures.
Hong Kong (China) 🇭🇰
When considering to start a business in Hong Kong, it is often likened to Singapore due to its favorable business conditions and ease of operation. Hong Kong’s economy thrives on free trade principles and its strategic position as a gateway to mainland China in the heart of Asia. Despite the lingering effects of social and political unrest in 2019, Hong Kong continues to offer a highly competitive environment for business growth.
Foreign investors can expect a low-tax environment, a straightforward company formation process, and a variety of legal entities suitable for businesses of all sizes when expanding into Hong Kong. The usual corporate income tax rate is 16.5%, with a 15% rate for unincorporated organizations. Another significant advantage is the ease of expanding into new areas, as Hong Kong’s institutions remain constant and transparent compared to the swiftly changing legislation in mainland China.
Foreigners can own 100% of their business in Hong Kong and can be the sole owners or shareholders, with no specific requirements regarding permanent residency or nationality. Alongside Cantonese, English is one of Hong Kong’s official languages. The city also boasts a competent and well-educated local workforce, along with a steady influx of talent from around the world.
Seoul (South Korea) 🇰🇷
South Korea stands as Asia’s fourth-largest and the world’s eleventh-largest economy, renowned for its rapid transformation from poverty to prosperity, often referred to as the ‘Economic Miracle.’ This transformation has attracted numerous international organizations and investments.
Ranked as a “free economy” by the Index of Economic Freedom, South Korea boasts minimal government intervention in business affairs. The government offers incentives such as industrial sites, tax benefits, and subsidies to foreign businesses contributing to the local economy. Additionally, government-supported free trade zones, tax breaks, and affordable land rentals serve as further incentives for expansion.
Seoul, the capital and primary business hub of South Korea, is recognized as one of the most competitive global cities for future development, boasting the world’s fourth-largest metropolitan economy. The city’s economy is predominantly export-driven, with a focus on electronics and information technology manufacturing.
The service sector is also a significant employer in Seoul, with international trade corporations, banking and insurance firms, and professional service organizations leading the way. As the financial capital of the country, Seoul hosts numerous annual trade events, with major banks and stock exchanges headquartered in the city and on Yi Island.
With its adaptability to future trends, Seoul ensures the sustainability of businesses within its borders. As the city’s economy continues to grow, the opportunities for international companies to invest in various industries within Seoul are on the rise.
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