When Chen Xi and his family searched for their first home in Singapore after moving from Beijing, they realized that their budget for the right type of property would have to be much higher.
The impact of the pandemic meant that new property developments in Singapore were put on hold, and with the reopening of the border, foreigners were arriving in droves to work and study, which meant that demand far exceeded supply in the island state.
It’s not just professionals like Chen, who works in finance, who have taken the plunge. Chinese entrepreneurs who have migrated to Singapore in recent years have made a name for themselves in the country. This year, naturalized Chinese-born citizen Li Xiting, co-founder and chairman of Shenzhen Mindray Bio-Medical Electronics, was named the richest Singaporean on Forbes’ annual billionaires list unveiled in April. Li also topped the country’s rankings last year.
For decades, Singapore has been recognized as the financial and wealth management hub of Southeast Asia, attracting entrepreneurs and middle-class families from Malaysia and Indonesia. But over the past 10 years, Chinese immigrants have become the most vital migrant community, rebuilding the map of local wealth and bringing change to local industries.
With its flexible immigration policies and stable financial environment, Singapore has attracted Chinese entrepreneurs to relocate and set up family offices as they view the country as a safe haven for their wealth and business expansion plans. Likewise, professionals in industries such as gaming, technology, and cryptocurrency see opportunities in Singapore that the house struggles to offer.
Chinese immigration tycoons
This year’s Forbes list named four immigrants from the Chinese mainland and one from Taiwan among the 10 richest people in Singapore. Zhang Yong, founder of Chinese hotpot chain Haidilao, came in sixth place, after being named the richest Singaporean in 2019 and 2020.
Prior to Zhang, established Southeast Asian families have long dominated the top spots on the list. But the influx of new Chinese immigration tycoons has shattered Singapore’s original wealth map and added a new dimension to the local industrial ecology.
An academic involved in Singapore’s policy consultation told Caixin that the government prefers high-tech manufacturing, technology and innovation industries to big polluters and energy consumers like real estate and mining. mining.
Hoping to attract such businesses, Singapore places great importance on the protection of intellectual property rights to foster a good business environment and the rule of law, the researcher said, and that “Singapore has made a great job setting up the next generation of innovation tracks, including digital assets, cryptocurrency and artificial intelligence.”
Over the past two years, Singapore has adjusted and eased its COVID disease control measures and became the first Asian country to announce its reopening and normalization plan. Its more flexible immigration policies continue to attract large numbers of wealthy individuals.
“During the pandemic, Singapore’s strengths – efficient and humane government management, good medical facilities and financial environment – have attracted some of the wealthiest people in the world,” said firm partner Liu Ben. accountant from Singapore.
Haven of peace for businesses
Some Chinese entrepreneurs have chosen to expand their business in Southeast Asia, given the intense competition and saturated markets in China. As one of the most developed countries in the region, Singapore is now home to the regional headquarters of many global companies.
Wang Feng, founder of a Singapore venture capital institute, said Chinese consumer product entrepreneurs are busy bringing ideas and brands to Singapore, such as eyewear and clothing brands.
“Rather than just making financial investments, these Chinese entrepreneurs are setting up regional business development offices in Singapore to gradually expand their business to Southeast Asia,” he said. “In the meantime, they are also setting up their own family offices and those of their leaders in Singapore.”
Family offices, including single family offices (SFOs) and multi-family offices, serve wealthy families by providing services such as professional investment management. According to the Singapore Economic Development Board, the number of family offices in the country increased fivefold between 2017 and 2019. The number has steadily grown during the pandemic, with 400 SFOs established by the end of 2020.
A professional from a Singaporean wealth management company said that in 2020 most of their Chinese clients were CEOs of listed companies who travel to Singapore for asset allocation and wealth management.
But since last year, the client profile has changed for most corporate executives or professionals under the age of 40, who have seen opportunities in Singapore develop for the industry they worked in and were therefore interested in migrating, or they want to find a new place to live or a new learning environment for their children. For this group, the normal course of action was to invest a small capital to create a family office.
Apart from Chinese entrepreneurs, middle-class professionals have also started choosing Singapore as their new home.
Game makers are among them, seeking new development opportunities as the domestic market suffered “involution” or excessive competition, while tightening licensing regulations stifled growth. Meanwhile, some tech companies have considered going overseas to deal with growing geopolitical risks and supply chain issues.
As China tightens cryptocurrency regulations, industry insiders have flocked to Singapore as a safe haven as the country fosters blockchain technology innovation.
Late last year, Shanghai-based non-fungible token company founder Zhang Ye decided to move to Singapore. And like many of his peers, he relocated the founding team first, leaving the R&D team in China.
However, in September, Singaporean authorities placed crypto exchange Binance on an investor alert list. The platform’s operation in Singapore was shut down in February, so investors in the country could no longer trade cryptocurrencies through Binance.
Binance’s regulatory crackdown in Singapore has Zhang worried. Afterwards, he wondered if Singapore might be the right place to settle.
Another Hong Kong?
Singapore has also attracted many professionals from Hong Kong as they share similar cultural backgrounds and financial environments.
According to the Singapore Tourism Board, the first quarter of this year saw 6,461 visitors from Hong Kong, more than seven times the same period last year. The average stay was around 17 days, compared to an average of three days in 2019.
According to a Hong Kong-based lawyer specializing in family offices, while some large-scale family offices or those of European and American origin have withdrawn from Hong Kong or entirely focused on Singapore, many people are waiting and watching. still .
After two years in Singapore, Meng Yu, a fund manager who invests primarily in the Chinese stock market, moved to Hong Kong during the pandemic. Meng believes there are more opportunities in Hong Kong, where “the capital market is more active.”
But both Singapore and Hong Kong face future challenges.
“Over the past decades, Singapore has been very successful in its international positioning, gaining a political, industrial and economic position that far exceeds its economic size and population share,” said Gao Hao, director of the Global Family Business Research Center. from Tsinghua University. .
“However, given the perilous geopolitical situation, Singapore’s viable space in the great power game is likely to shrink in the future, posing a significant new challenge,” he said.
For Hong Kong, Gao said the international financial center should further strengthen its innovative strength. The city could take inspiration from Singapore’s inclusive immigration program to attract scientists, entrepreneurs, financiers, artists and other top talent from around the world.
Wang Feng, Zhang Ye and Meng Yu are pseudonyms.
Cai Xuejiao is a freelance writer.
Also read the original story.
Caixinglobal.com is the English-language online news portal of Chinese financial and business media group Caixin. Nikkei has an agreement with the company to exchange articles in English.