Monday, October 09, 2006
[RealEdge] BT : S'pore remains a choice location for MNCs
| Published October 9, 2006  | |||
| S'pore remains a choice location for MNCs It ranks 8th in world for foreign direct investments: IBM study
By CHEN HUIFEN
(SINGAPORE) Amid the regional competition for foreign direct investments, Singapore remains an attractive location for multinational firms looking to set up new plants and generally expand their operations, a study by IBM Business Consulting Services shows.
In its latest report on 'Global Trends in Location Selection', Singapore was ranked third in Asia Pacific and eighth in the world, in terms of the number of foreign investment projects recorded last year. The Republic drew a total of 168 projects, up from 113 in 2004. China, which took the regional lead, generated 933 projects last year, from 1,248 in 2004, while India was the second most popular investment destination, despite a 3 per cent fall in the number of projects to 699. The study takes into account foreign investment deals that have been announced around the world, including both greenfield and expansion projects. It, however, excludes mergers and acquisitions, capital flows that do not create jobs and non-contestable projects like retail or sales offices that are driven largely by the local consumer market. 'We focus on those kind of investment projects where location decisions were made, and where there is at least realistic assumptions that the company has a choice between locations,' explained Roel Spee, worldwide leader for IBM Global Business Services' global location strategies practice. The analysis was mined from the database of IBM's global location strategies practice, which includes all countries worldwide. Singapore scored well in the number of R&D projects, firming up 36 of them which generated 2,954 jobs last year. This was higher than the 24, which accounted for 1,085 R&D jobs in 2004. This puts Singapore in the No 6 position globally - behind India, China, the US, the UK, France (5th in number of R&D projects) and Canada (5th in number of R&D jobs) - both in the number of R&D projects and jobs created. He attributes Singapore's continued attractiveness to the stable environment, strong government support, logistics strengths, and low tax rates. 'And personally, I think another strong point for Singapore is that it has always been very good at anticipating what the next requirements, particularly skill requirement, of companies are going to be,' he said. Singapore generally holds a positive attitude towards foreign investments, he added. That, coupled with savvy marketing allows it to profit more than other counterparts in the region. 'Singapore has a very strong image in this business, and that's something very powerful,' he said. 'Perception and image play a very important role in foreign investments because companies very often select locations purely on the basis of perception and neglect locations that have a bad reputation.' But it cannot rely solely on historical advantages for future success. Firms are considering more locations as realistic options, including Vietnam, or even places in Africa which may not have been seen as viable candidates five years ago. 'It means that for countries such as Singapore, it has to remain very sharp on maintaining that leading edge,' he said. 'Particularly so in those new emerging industries, like renewable energy, nanotechnology and so on, locations such as Singapore should try to understand what potential it has in those markets, what is really unique, and again what are the skills requirements, and how it can plug into the requirements that companies have when they are looking for locations.' The analysis also revealed Europe replacing Asia as the region that attracted the biggest share of global foreign investments. Of the 8,075 projects recorded last year, Europe accounted for 39 per cent, while Asia took 31 per cent. Western Europe saw its share of foreign projects increase to 26 per cent, from 22 per cent, while the proportion in Eastern Europe has remained flat at 13 per cent. North America's share rose slightly to 18 per cent, from 17 per cent. With matured economies showing healthy growth last year, international firms are starting to mull expansions there again, he said. | |||
Change settings via the Web (Yahoo! ID required)
Change settings via email: Switch delivery to Daily Digest | Switch format to Traditional
Visit Your Group | Yahoo! Groups Terms of Use | Unsubscribe
__,_._,___
