Why Entrepreneurs from China Should Set Up a Company in Singapore

Introduction

As China’s economy continues to expand globally, many Chinese entrepreneurs are looking for opportunities to extend their business presence overseas. Among the numerous destinations available, Singapore has emerged as one of the most attractive choices for Chinese business owners who wish to expand into Southeast Asia and beyond.

With its pro-business policies, strong legal system, low tax rates, and strategic location, Singapore offers the perfect ecosystem for international business growth. In this article, we explore in depth the key reasons why entrepreneurs from China should consider setting up a company in Singapore.

1. Strategic Location and Gateway to Southeast Asia

Singapore’s location at the crossroads of major global trade routes makes it a natural hub for business and logistics.

• Gateway to ASEAN: By setting up in Singapore, Chinese entrepreneurs can easily access the 10-member ASEAN market, which collectively has a population of over 680 million and a combined GDP exceeding US$3 trillion.

• Connectivity: Singapore’s world-class Changi Airport connects to over 400 cities globally, while its port is one of the busiest and most efficient in the world.

• Proximity to China: The short flight distance between Singapore and key Chinese cities such as Shanghai, Guangzhou, and Shenzhen makes it easy for Chinese business owners to manage regional operations efficiently.

For Chinese companies looking to internationalize, Singapore serves as the ideal springboard for expanding into emerging Southeast Asian markets such as Indonesia, Vietnam, Thailand, and Malaysia.

2. Political Stability and Strong Legal Framework

Singapore is widely recognized for its transparent governance and robust legal system, both of which are crucial factors for long-term business planning.

• Political Neutrality: The Singapore government is stable, efficient, and corruption-free. Policies are designed to support businesses, not hinder them.

• Rule of Law: Singapore’s legal framework is based on English common law, providing strong protection for contracts and property rights.

• Intellectual Property (IP) Protection: For Chinese entrepreneurs in tech, innovation, or creative industries, Singapore offers one of the best IP protection environments in Asia.

This stability gives investors and entrepreneurs the confidence to operate in Singapore without worrying about sudden regulatory shifts or corruption.

3. Competitive and Transparent Tax Regime

One of the strongest attractions for Chinese entrepreneurs is Singapore’s low and simple tax structure.

• Corporate Tax Rate: Capped at 17%, it is among the lowest in the developed world.

• No Capital Gains Tax: Profits from selling assets are not taxed, allowing greater flexibility in investment and reinvestment.

• No Dividend Tax: Shareholders receive dividends tax-free, making Singapore ideal for holding companies.

• Avoidance of Double Taxation Agreement (DTA): Singapore has signed a DTA with China, ensuring that profits are not taxed twice in both countries.

Additionally, start-ups enjoy tax exemptions under the Start-Up Tax Exemption Scheme, allowing new companies to pay minimal taxes in their first few years.

4. Advanced Financial Infrastructure and Access to Global Capital

Singapore is a leading international financial hub, offering businesses seamless access to global banking, financing, and investment opportunities.

• Global Banks and Financial Institutions: Over 200 banks operate in Singapore, including top Chinese banks such as ICBC, Bank of China, and China Construction Bank.

• Efficient Banking System: Opening a corporate bank account is straightforward and highly secure, enabling international transactions in multiple currencies.

• Financing and Venture Capital: Startups and SMEs can access venture capital, government grants, and private equity funding easily.

• Free Flow of Capital: There are no foreign exchange controls, so funds can move in and out of Singapore freely.

For Chinese entrepreneurs who want to expand beyond China’s capital control limitations, Singapore offers unmatched financial freedom.

5. Easy and Efficient Company Incorporation

Singapore is consistently ranked as one of the easiest places in the world to start a business.

• Fast Registration: The entire company incorporation process can be completed within 1–2 working days.

• 100% Foreign Ownership Allowed: Chinese citizens can fully own their Singapore-registered company without needing local partners.

• Online Process: Registration can be done completely online through the Accounting and Corporate Regulatory Authority (ACRA) portal.

• Professional Corporate Service Providers: Firms like Koh Management offer one-stop solutions covering incorporation, accounting, tax filing, and corporate secretarial services.

This simplicity enables entrepreneurs to focus on business growth rather than red tape.

6. Skilled Workforce and Multilingual Environment

Singapore boasts a highly skilled, educated, and multilingual workforce, which is essential for business success in a globalized economy.

• Bilingual Advantage: English is the main business language, and Mandarin is widely spoken, allowing Chinese entrepreneurs to communicate easily.

• Talent Pool: Singapore produces top-tier talent in finance, technology, logistics, and engineering sectors.

• Work Visa Flexibility: The Employment Pass (EP) system allows companies to bring in foreign professionals, including Chinese experts, to work in Singapore.

This talent diversity and government support make Singapore ideal for building international teams.

7. Pro-Business Government Policies and Support Schemes

Singapore’s government is renowned for being pro-business and innovation-driven.

• Enterprise Singapore: Provides extensive assistance to businesses expanding overseas or adopting technology.

• Grants and Incentives: Programs like the Enterprise Development Grant (EDG) and Market Readiness Assistance (MRA) Grant help companies with funding for innovation and internationalization.

• Smart Nation Vision: Encourages digital transformation, automation, and the use of emerging technologies like AI and blockchain.

These initiatives ensure that businesses remain competitive and future-ready in a rapidly evolving economy.

8. Strong China–Singapore Bilateral Relations

Singapore and China share a long history of cooperation, both economically and culturally.

• China-Singapore Free Trade Agreement (CSFTA): Upgraded in recent years to enhance trade and investment flows.

• Belt and Road Initiative (BRI): Singapore actively participates in China’s BRI, serving as a financing and logistics hub for regional projects.

• Chinese Corporate Presence: Many major Chinese firms, including Alibaba, Huawei, and Tencent, have set up regional headquarters in Singapore, creating a strong business ecosystem for new entrants.

This strong bilateral relationship makes Singapore a natural and trusted choice for Chinese entrepreneurs venturing abroad.

9. Excellent Quality of Life and Safe Environment

Beyond business, Singapore is an ideal place to live and raise a family.

• Safety and Cleanliness: Consistently ranked as one of the safest and cleanest cities in the world.

• Healthcare and Education: Boasts world-class hospitals and top international schools, perfect for entrepreneurs relocating with families.

• Cultural Harmony: Singapore’s multicultural environment makes it easy for Chinese nationals to integrate.

• Global Recognition: Ranked high globally for quality of life, infrastructure, and ease of doing business.

Entrepreneurs can enjoy peace of mind knowing their families are in a secure and comfortable environment.

10. Launchpad for Global Expansion

Singapore’s reputation as a neutral, trusted, and globalized business hub helps companies go beyond Asia.

• International Reputation: A Singapore-registered company often enjoys better credibility with banks, investors, and partners.

• Brand Neutrality: Singapore’s neutral stance allows companies to enter Western and Asian markets without geopolitical bias.

• Ease of Expansion: From Singapore, companies can easily set up subsidiaries in other countries thanks to its strong trade agreements and business network.

For Chinese entrepreneurs eyeing global markets, Singapore is not just a destination — it’s a launchpad.

Conclusion

Setting up a company in Singapore offers Chinese entrepreneurs an unbeatable combination of strategic advantages, business-friendly policies, financial transparency, and international connectivity.

From its low tax system to its world-class infrastructure, from its stable government to its multicultural workforce, Singapore stands out as Asia’s most trusted business hub.

Whether you’re a startup founder, investor, or established business owner, Singapore provides the perfect platform to scale your business globally while maintaining close ties with China.

To find out more, visit https://www.shkoh.com.sg/incorporation-services