- India, Newsletter
- October 9, 2021
India and the United Kingdom are aiming to resume negotiations on a Free Trade Agreement (FTA) on 1 November 2021 as the two countries agreed for an Early Harvest Agreement by March 2022 that would allow both to establish selective gains in commodities and services. India and UK arrived at this decision soon after a virtual meeting held between the Indian Commerce and Industry Minister Piyush Goyal and his British counterpart, Secretary of State Elizabeth Truss on Monday13 September 2021.
The announcement comes when India has initiated fast-tracking of FTA negotiations with several other countries including the European Union, Australia, United Arab Emirates, and Canada for promoting FDI with the help of a complete guide on doing business in India.
“Proposed FTA between India and the UK is expected to unlock extraordinary business opportunities and generate jobs. Both sides have renewed their commitment to boosting trade in a manner which benefits all,” a statement from the Indian Commerce and Industry Ministry revealed.
Earlier on September 3, Goyal said in an industry event that India was working on multiple FTAs with other democracies who believe in transparent, fair and rule-based investment and trade opportunities as a part of its renewed strategy to move past protectionism, reduce trade deficits and attract foreign investors for company formation in India.
“Substantial work has already been done and extensive stakeholder consultations have been held involving industry/business associations, export promotion councils, buyers/sellers associations, regulatory bodies, ministries/departments, public research bodies, etc,” Indian Commerce and Industry Ministry noted.
Goyal mentioned the formation of bilateral working groups (BWGs) for different tracks to identify and understand the ambitions, interests and sensitivities of each other to accelerate the negotiation progress. Regular meetings were convened amongst the BWGs and most of the work was almost over.
He believed BWG discussions will help both sides in understanding each other’s policy regimes and resume joint scoping discussions from 1st October for finalization of terms of reference and launching of negotiations in November.
“An interim trade agreement, as the first step of an FTA, would allow both of us to immensely benefit from the early gains of the partnership,” Goyal remarked. There is a need to strike a balance between commitments and concessions in goods and services, he emphasized.
There will be a reduction or elimination of tariffs on some selected goods during the interim trade agreement. In services, certain services of mutual interest may be included in the interim agreement. “If necessary, we may also explore signing a few Mutual Recognition Agreements in selective services like nursing and architecture services,” Goyal noted.
The UK Secretary of State for International Trade added, “Today Piyush Goyal and I launched trade working groups to lay the groundwork for our forthcoming UK-India trade deal, which will: boost access to more than a billion consumers; bolster our science and tech industries; and support jobs in both countries.” According to the UK government, regular ministerial dialogues between the two sides will help explore potential areas in the trade agreement encompassing tariffs, standards, Intellectual Property, trade remedy measures and data regulation.
In a bid to expand its market after Brexit, the UK has struck several FTAs and primarily with some of the largest and fastest-growing economies in the Indo-Pacific region. The UK has signed 68 deals and has reached FTAs with Vietnam, Singapore, Japan, South Korea, and Australia. A deal with India shall mean the promotion of exports, lowered tariffs, easing of regulations and enhanced bilateral trade.
Increasing UK-India trade has been dubbed a huge opportunity by the UK, given India’s position as one of the world’s biggest and fastest-growing economies and home to more than a billion consumers.
India is one of the key trading partners of the UK and the trade between the two countries stood at USD15.45 billion in 2019-20 and USD13.11 billion in 2020-21 with a trade balance in favour of India.
Data provided by the Ministry of External Affairs (MEA) revealed that during 2019-2020, India invested in 120 projects and generated 5,429 new jobs in the UK. For the UK, India was the second-largest source of foreign direct investment (FDI) in 2019 just after the US. There are more than 850 Indian companies currently operating in the UK and their combined revenue is almost Euro 41.2 billion, as per the ‘India meets UK” report- 2020 by CII- Grant Thornton.
Clinching an early Harvest deal will be favourable for both India and the UK and provide many benefits for enhancing economic recovery in the post-pandemic era and generate huge enthusiasm and momentum before signing the final FTA.
Newly introduced policies of India namely ‘Make in India’ and ‘Atma Nirbhar Bharat’ will be complemented once the FTA negotiations with trading partners come to fruition.
- Newsletter, U.A.E
- October 8, 2021
The property investors in Dubai can now avail three years visa with a minimum investment of Dh750,000 against Dh1 million required earlier, an official notification on the website of the Dubai Land Department (DLD) says. Previously the investor visa used to have a validity of 2 years and has also been extended now.
The visa facility is made available to the property investors by DLD through Taskeen Programme when an individual owns a property valued at a minimum of Dh750,000. The visa is renewable on the expiration of validity after three years.
This is a much awaited and highly welcome move to the real estate developers who demanded a long-term property visa for reviving the languishing real estate market. It is believed that the reduction in minimum investment amount would be an added advantage for real estate developers and help improve the sentiment of global investors willing to participate in Dubai’s flourishing real estate market during the historic event of Dubai Expo 2020. The property developers can see an increase in demand which in turn will boost the construction sector.
The government move has also been seen as timely and strategic as it would attract wealthy individuals in the middle east, many of whom are witnessing a growing geopolitical instability in the region, to own permanent residential property in Dubai and UAE for long term prospects and stability and would be an additional stimulus for the country’s economic growth.
For wealthy families across the world, Dubai is already well known for its high standards of living, world-class healthcare facilities, highest standards of safety, economic stability, ease of doing business, and with the roll-out of this new scheme, it shall further promote its competitiveness amongst the global investors and facilitate the business establishment and new company formation in Dubai.
Increased participation of entry-level buyers is expected for Dubai real estate assets and would present an opportunity to the real estate developers in selling off their existing properties and freeing up their blocked capital for new projects. Though it would take some time to correctly ascertain the exact ramifications of this move, it is unequivocally agreed by all quarters associated with Dubai Properties that the confidence of property developers in Dubai will be many times boosted on the back of extension of visa validity.
The Dubai real estate sector has started showing signs of recovery after being severely hit by the pandemic as almost 10% of expatriates had to leave Dubai due to job losses and many residential properties stayed vacant amidst a fall in real estate prices.
Emaar Properties, one of the biggest property developers In Dubai witnessed its sales skyrocket to a new high of USD 2.63 billion during the second quarter of 2021 and the official sales price index released by the DLD was also seen rising. August 2021 recorded the highest property sales of almost 4 billion USD last achieved more than a decade ago.
Dubai residency law mandates certain documents for investor visa application including the passport of the investor and an electronic copy of the title deed certificate. Owning a property with a minimum value of Dh750,000 is also mandatory for the applicant. For mortgaged properties, 50% of the property value or a minimum of Dh750,000 payment must be made to the bank. A mortgage bank statement along with a no objection letter in Arabic is needed for the visa application process. As the visa application process varies from emirate to emirate, involves several steps and can be overly complex at times needing expert knowledge on Dubai residency law, professional Dubai based Investor visa services are normally recommended for speedy visa processing and future follow-ups with the General Directorate of Residency and Foreign Affairs ( GDRFA), Dubai.
Dubai issues golden visas which are also long-term UAE investor visas only issued to eligible investors for a five or ten-year residency based on the size of their investment in the UAE and sponsor an investor’s spouse, children, one manager and one advisor.
While the 10-year residency visa applies to investors of at least Dh10 million, a 5-year residency visa needs a minimum investment of Dh 5 million. The long-term investor visa also mandates an additional set of requirements established by the GDRFA-Dubai and visas are granted to selected individuals belonging to specialized fields such as technical, research, science, medicine etc.
- India, Newsletter
- October 8, 2021
External Affairs Minister Dr S Jaishankar visited Hyderabad House in New Delhi on Sunday, the 19th of September 2021 to receive and meet the Foreign Minister of Saudi Arabia, on his three-day visit to New Delhi. It was the first Ministerial visit from Saudi Arabia since the time of the covid pandemic outbreak.
The two Ministers discussed the status and progress of implementation of the Strategic Partnership Council Agreement including measures for strengthening the partnership between the two countries in healthcare, trade, investment, energy, defence and security.
Indian Prime Minister Narendra Modi met Saudi Arabia’s Foreign Minister on Monday, the 20th and Tweeted saying, “Pleased to receive Foreign Minister of Saudi Arabia, Prince Faisal bin Farhan Al Saud. Exchanged views on ongoing bilateral cooperation initiatives and regional situations. Conveyed my regards to His Majesty the King and His Highness the Crown Prince”
The Prime Minister reiterated the willingness of India to witness larger investment from Saudi Arabia in the country’s industrial sectors including energy, IT and defence manufacturing in an in-person meeting with Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan Al Saud in New Delhi on Monday.
The two countries’ views and perspectives on regional developments were discussed in the meeting like the situation in Afghanistan, an official press release noted. Several bilateral cooperation initiatives that have been recently undertaken by India and Saudi Arabia were also discussed and reviewed in this meeting.
The historic visit of His Royal Highness Crown Prince to India in February 2019 along with the country’s Deputy Prime Minister and the Minister of Defence was instrumental in Saudi-India bilateral ties and paved the way for a promising relationship between the two countries. The Crown Prince announced a Strategic Partnership Council between the two countries, led by Himself and Prime Minister of India and supported by the ministerial representation from the two countries and encompassing the entire range of strategic relationships.
The Indian Prime Minister visited Saudi Arabia on 29 October 2019 and the two sides set up the Strategic Partnership Council as announced by His Royal Highness Crown Prince earlier. The Strategic Partnership Council formed by the two countries is to explore increased cooperation in trade and investment in several industry sectors, defence and counter-terrorism.
Saudi Arabia’s Ambassador to New Delhi, Dr Mohammed Al Sati previously highlighted that his country values India as a close ally and strategic business partner. Bilateral cooperation in areas of training, knowledge sharing and the fight against terrorism was emphasized in his speech. Dr Al Sati also praised India in its handling of the covid pandemic including the economic relief package provided by the Indian government.
The world’s largest oil exporter earlier confirmed saying that Saudi Arabia’s investment plans in India are on track and more than 100 billion USD investment in Indian petrochemical, infrastructure, refining, mining, and manufacturing, agriculture and several other sectors would be made as announced by Crown Prince Mohammed bin Salman in 2020. Saudi Public Investment Fund (PIF) already planned for an investment of approximately USD 1.3 billion in Reliance Retail and USD 1.5 billion in Reliance’s Jio platform.
The Reliance Saudi Aramco deal is also on the verge of finalization as Saudi Arabia commits a steady supply of crude oil for Reliance refineries and makes an investment in India’s energy sector by purchasing a stake in Reliance Industries for an estimated 20 to 25 billion USD. An investment in the West Coast refinery petrochemical project is also on the cards as per a report. A complete guide on doing business in India is helping Saudi entrepreneurs and investors in planning and launching their Indian business operations.
The Indian Prime Minister in the recently held meeting with the Saudi Foreign Minister sought greater investments from Saudi Arabia and urged that Saudi entrepreneurs come for new company formation in India in energy, IT and defence manufacturing as these sectors can offer huge growth opportunities to benefit from. Saudi Arabia’s efforts in ensuring the safety and health of Indian ex-pats and workers during the Covid-19 pandemic was also appreciated by the Prime Minister.
The recent political crisis in Afghanistan was also discussed between the Saudi Foreign Minister and Indian External Affairs Minister. India has taken a ‘wait and Watch’ stance and also started discussions with other gulf countries e.g., UAE, Qatar, and Bahrain, Jaishankar remarked. Indian Prime Minister, Narendra Modi had earlier said that the matter regarding recognition of the new set-up in Afghanistan should be a collective decision of the global community.
- Newsletter, Singapore
- October 7, 2021
The Association of Southeast Asian Nations (ASEAN) long enjoyed a robust and thriving trade and investment relationship with the US and the region is perceived by many American companies as potentially attractive for exploring business opportunities. This has been further fuelled by the recent Regional Comprehensive Economic Partnership (RCEP) signed on 15 November 2020 at a virtual ASEAN Summit hosted by Vietnam, an agreement between the 10 member states of the ASEAN and five of its free trade agreement (FTA) partners.
The RCEP is significant for both US businesses and investors due to the huge size of the participating economies amounting to 29% of the world’s GDP with 30% of the world’s population and having a market value of almost USD 25 trillion. The ASEAN economy also has a vast consumer base of approximately 2.5 billion of which an estimated 1 billion hail from the middle-class.
The RCEP will establish a comprehensive economic partnership based on the existing bilateral ASEAN agreements with individual FTA partners and be governed by a set of rules and standards such as better market access and reduced trade barriers. For American investors who look for one of the best Singapore company incorporation, RCEP will help by providing many trade and investment opportunities in new areas.
As per researchers, technology adoption has taken the front seat in the ASEAN to support economies and societies after the Covid pandemic and mainly for streamlining supply chains through initialization. The US high-tech companies can play a decisive role in accelerating this transformation and make distribution channels more effective. The supply chain has become the centre stage in almost all American companies’ long term business strategies due to the unprecedented disruptions experienced by the pandemic and made it more relevant for them to explore supply chain partners within ASEAN regional partners for digital integration of distribution processes.
Increased consumerism boosted by a resilient supply chain will promote sectors including FMCG, pharmaceutical and medical & diagnostic devices. Many US multinationals are now eager to relocate their manufacturing facilities closer to ASEAN and especially to Singapore, the new Silicon Valley in Asia as the city-state provides the highest level of technology adoption, political stability, safest business climate and strong manufacturing capabilities to make their businesses more competitive.
The ASEAN renewable energy sector has also got a big push recently in the face of increasing clean energy demand due to rapid industrialization and the US businesses can offer clean energy solutions to the participating economies.
A recent survey conducted by Standard Chartered revealed that the majority of the US companies expect considerable business growth in numerous business sectors of ASEAN during the next 12 months. While 93% of corporations expected an increase in revenue, an increase in production was anticipated by 86% of respondents. 60% of the respondents surveyed were optimistic about business expansion in Singapore followed by Indonesia and Thailand that were favoured by 45% and 43% of executives surveyed.
57% of the American companies looking for business opportunities in the ASEAN considered Singapore as their most preferred destination for regional marketing and administrative head offices and 43% favoured it for their innovation and R&D centre in ASEAN.
Several American corporations are critically assessing the USSFTA and RCEP synergy for making Singapore the primary hub to reach out to the vast ASEAN market. Besides the accessibility to a huge market and customer base, skilled workforce and diversified product portfolios have been considered to be the other two most important factors, the survey noted. 70% of respondents reasoned market access as the major driving factor while workforce and diversified product footprints were cited as the main cause by 53% and 40% of companies. Almost half of the surveyed participants expressed their desire to increase investment in Singapore over the next few years.
Singapore is also advantageous as a regional hub due to well-developed banking systems and other financial and logistics support services not readily available in other countries in the ASEAN. Many multinational banks in Singapore offer facilities to foreign entrepreneurs for opening a bank account seamlessly for Singapore company incorporation and meeting their financial needs in the Asia-Pacific region and beyond. US Companies incorporated in Singapore can also be 100 per cent owned by American companies.
A very competitive corporate income tax rate of 17% prevails in Singapore and profits realized overseas is excluded from taxation by the government. No capital gain or inheritance tax is also applicable to foreign American investors.
Besides all advantages, challenges are also being examined by the American businesses while considering Singapore for investment purposes. Amongst these challenges, the current global geopolitical instability reduced consumer spending and the health crisis was cited as the biggest challenges by 73%, 65% & 63% of people respectively. Acclimatizing the business model in the ASEAN was also cited as a great challenge by 68% of participants.
The US has been the worst affected by the coronavirus with the highest number of deaths and many ultra-rich families are becoming vulnerable and looking for a safer haven with world-class health and medical facilities. Singapore naturally comes as the first choice with zero counts of mishaps and high levels of control in combating the virus.
A new and innovative investment vehicle has also been introduced by the Singapore government last year, known as the Variable Capital Company, making it more attractive for American family offices and private equity firms. More than 260 VCCs have already been formed as per data available from the Monetary Authority of Singapore (MAS).
The number of single family offices in Singapore has increased by almost two times over the last two years as it is relatively easier for the ultra-rich to settle in Singapore. Google co-founder Sergey Brin and Shu Ping, the Chinese billionaire, have established family offices in Singapore. American Investment Management company, Bridgewater founder Ray Dalio recently announced establishing a family office in Singapore. The family office of late Microsoft founder Paul Allen also figures in the list.
The Singapore authorities are relentlessly striving to attract high-quality investors and UHNWIs from the USA and make the country the most desired destination for US high-tech multinationals.
- Article, Singapore
- October 6, 2021
Southeast Asia is one of the fastest-growing economies in the world today with nearly 10% of the world’s population residing in the ten member countries of the Association of Southeast Asian Nations (ASEAN) including Vietnam, Singapore, Brunei, Indonesia, Thailand, Cambodia, Philippines, Malaysia, Myanmar, Lao People’s Democratic Republic. Geographically, Southeast Asia is a tropical region favouring Solar energy as the best renewable.
Why Solar Energy Transition?
Rapid industrialisation in the ASEAN and the governments’ commitment to 100% electrification of households are transforming the economic and energy outlook in this region as policymakers across many of these countries are striving to meet the growing energy demand in a secure, affordable and sustainable manner for improving the quality of life of their citizens. Several incentives and support schemes have also been announced by the government of these countries to encourage the renewable energy sector.
As the rising energy demand in Southeast Asia has already outpaced the available energy supply within this region due to declining reserves of fossil fuel, the renewable energy sector is expected to take the driver’s seat with solar technology primarily fueling the growth of the regional renewable. Southeast Asia is presently working on a massive plan to take the renewable energy capacity from 517GW in 2020 to 815GW by 2025.
How is the Solar Energy Outlook in Singapore?
Singapore is intensifying its focus on solar PV installations due to shortage of land for wind energy and hydroelectricity installations and promoting the SolarNova program launched in 2014 by the Economic Development Board (EDB), the strategic measure for solar Photovoltaic (PV) growth.
The country added 296MW capacity over the last four phases spanning over 2015 to 2020 and another 60MW capacity has been installed this year. The rooftop solar PV installations on public housing are becoming most common.
The sea city is gradually approaching the next target of a minimum of 2GW of solar energy by 2030 that can cater to the demand of 350,000 households. The country is also investing in the R&D of floating solar energy for future expansion.
Singapore has demonstrated its commitment towards becoming a low carbon economy with a proposal of USD 1.8 billion investment from its foreign reserves for green financing. Government-owned Temasek in partnership with Black Rock has already invested USD 600 million to lower its carbon footprint.
How is the Solar Energy Outlook shaping in other parts of Southeast Asia?
Countries leading the region’s renewable energy initiatives are Vietnam, Thailand, the Philippines, Malaysia and Indonesia amounting to almost 84% of the total installed renewable energy capacity and setting an ambitious target of a 23% renewable energy share in the total primary energy supply by 2025.
Recently Vietnam has overtaken Thailand in installed solar power generation with an increase in PV capacity from a mere 86 MW in 2018 to 16,500 MW at the end of 2020 having the largest installed capacity for solar power generation among members of the ASEAN mainly contributed by rooftop solar as space is scarce in the country. Amendments in the public-private partnership regulation have also been a contributing factor for the solar PV boom.
Thailand is the second country in the Solar energy race contributing to 17% of total installed capacity in the region and has set a target for 30% of the country’s total energy consumption from renewable sources by the year 2036. Rooftop solar is playing the most predominant role in advancing its energy transition.
Improving the share of renewables in the total energy requirement from 2% in 2019 to 20% by the end of 2025 is the target for Malaysia with an approximate investment of USD 7.9 billion mostly for the solar system infrastructure. The government has also floated a tender for 1GW of solar projects under the fourth round of its Large Scale Solar (LSS) procurement programme.
Indonesia too plans to enhance renewable energy percentage from 9% in 2020 to 23% by 2025 and can generate 640000000 GW of solar power placing the country on the strong ground for achieving 100% green electricity by 2050.
The Philippines in its National Renewable Energy Plan specifies targets for a minimum l34GW of renewable energy installations by 2040 and plans for 100% foreign ownership for attracting foreign investment in this sector.
Bottomline
It is believed that the renewable energy sector in ASEAN region after the covid pandemic would recover in 2021 driven by the resumption of economic activities and support policies of various governments.
- Article, Singapore
- September 30, 2021
These days, we live almost our entire lives online. It is therefore no wonder that businesses too feel the need to capitalise on this. Naturally, setting up an e-commerce business or service platform seems much more logical than establishing a brick-and-mortar shop. While the initial invested capital may be almost the same, the running costs will definitely be far lower.
If you too are an entrepreneur trying to set foot in the world of e-commerce, where better to start than in the economically flourishing city-state of Singapore. And if you’re looking for a guide for doing business in Singapore, you’ve come to the right place. Read on to discover quick tips on starting your own e-commerce business in the Lion City. While this guide is by no means exhaustive, it will help you gain important knowledge towards laying the foundation for your business plans. Let’s get started –
Research is everything
Why is research so important?
Firstly, research will tell you whether your e-commerce business has an audience or a market. It will also show you what the competition is doing and help you to identify any gaps in the market that your product or service can fill. This knowledge can prove to be immensely profitable for you.
While doing research, remember to dedicate time towards calculating how much business capital you will require to get started. While starting a new venture can be exciting, be careful of overspending. Even though your business is online, keep aside sufficient funds for contingencies.
Guide to Incorporating Your Business in Singapore: Essential Checklist
Learn local guidelines
Create an incorporated company
Create your website
When creating your website, you may either choose to go with ready templates online or make your very own. The second option is slightly harder but will give your e-commerce brand a truly unique online presence and design. Make sure to choose an appropriate domain name that resonates with your business and brand. Choose a good hosting service too – one that you can rely on 24/7. After all, an online store never closes its doors at night…it works round the clock. You want your e-commerce website to be accessible to your audience no matter what time of the day they choose to visit it.
Make sure that your website is user-friendly. All the major tabs for shopping, using filters to sort products, and customer support should be easily visible. Product pages should have good content with easy visibility of the different colours, designs or quantities for buyers. Try to also set up a proper customer support system for your e-commerce business. A number or 24/7 email or chat support can go a long way in creating loyal customers. It will help your buyers know that they can reach out to you at any time.
You also need to focus on setting up a secure payment gateway. Make sure to provide people with a wide variety of payment options, including credit cards, debit cards and Google Pay, among others.
Focus on good marketing
Set up delivery
The final step involves setting up a reliable delivery system that will ensure that your goods or services reach your buyers. You may choose to hire a third-party company to carry out delivery for you or even do it with your own manpower, depending on your needs and how far your buyers are. For instance, if you have buyers from overseas, you will have to tie-up with a third-party delivery platform.
We hope that this guide on beginning an e-commerce business in Singapore has been a great read for you today!
- Article, U.A.E
- September 22, 2021
The United Arab Emirates has a flourishing economy and is one of the most popular countries for investors and businessmen. If you too are looking forward to starting your own business in the UAE, you may be aware that you need professional PRO services. For instance, if your setup is in Dubai, you would need professional PRO services in Dubai. PRO stands for public relations officer. PRO services help your company stay compliant with all the local rules and regulations for a business to run smoothly.
Now, you can either hire your own PRO or choose to outsource your requirements. An increasingly large number of businesses are choosing to outsource their PRO services. Wondering why? In this article, we will take a look at 5 major benefits you gain if you choose to outsource your company’s PRO service needs.
1. Access to a professional PRO service
When you choose to outsource your PRO service requirements, you get to receive help and guidance from industry professionals who are familiar with local rules and regulations. This way, your documentation and other legal compliance work will always be on time. You will not face the risk of unnecessary fines either. We, at IMC Group, will take care of all your requirements from visa services to paralegal services and corporate bank opening for a hassle-free experience.
2. Cost-effective approach
Outsourcing your PRO services is indeed more cost-effective than hiring your own staff. If you were to hire dedicated staff, you not only pay a salary but also hand out benefits that can cost you a lot. A professional PRO service company only charges you for the services you need and no more. Thus, you end up saving on your expenses while getting access to some of the best minds in the market.
3. Access to exclusive and dedicated support
IMC Group will assign you your very own PRO expert who will take care of all your work. We offer doorstep assistance in which we send our representative to your office to pick up all the necessary paperwork. You are thus left free to focus on your business requirements while we handle all the technicalities like visa, permits, licences and so on. Handling all of these on your own in a foreign country can prove to be quite a task…a professional PRO service will get things done on time, the right way.
4. Transparency of service
At IMC Group, we value integrity in business. Therefore, we believe in a completely transparent system of operating. Even though we take charge of all the paperwork so that your work is lighter, we will still keep you informed every step of the way. We enjoy good credibility and reputation as a professional PRO service provider in the UAE. With a wide range of services and an experienced team, you are in good hands with us.
5. Extensive range of service offerings
If you were to hire your very own staff as PRO professionals, you may need to hire multiple roles. At IMC Group, you just need to get in touch with us for all your PRO service needs. We are your one-stop shop for a range of services including renewal and processing of visas, attestation of documents, local sponsor, trade licence, legal services, registration for rental and lease, share transfer services, and more.
We hope that this article has been an insightful read and has helped you understand why you need PRO services and better yet, why you must outsource this requirement. Get in touch with us at IMC Group today to know more.
- Newsletter, U.A.E
- September 14, 2021
Originally scheduled to be hosted from 20th October 2020 to 10 April 2021, the belated Dubai Expo is ultimately going to be held from October 1, 2021 and will continue till March 31, 2022. The postponement of this historic event was due to the outbreak of the Covid 19 pandemic which ravaged the entire world including the UAE.
The Dubai Expo 2020 is spanning between the two leading cities of the Emirates, Dubai and Abu Dhabi and will witness 60 exhibitions daily with pavilions from 191 countries. The 182-day event will attract more than 25 million visitors across the globe besides running more than 200 restaurants at the venue.
The master plan for Dubai Expo 2020 has been designed by HOK, an American firm around a central plaza with three thematic districts dedicated to the Mobility District, Opportunity District, and the Sustainability District
World Expos for many decades have been used as venues to showcase the greatest innovations that have helped transform our present-day world and the same tradition will continue in Dubai Expo 2020 with the latest innovative technologies around the world.
India enjoys long historic ties with the UAE and will be the largest participant in this major event with a new look of its Pavilion. The pavilion has been designed in a four-level structure with technology, culture, space and heritage as the defining themes. Once the biggest event of the world finally resumes in Dubai, the Indian Pavilion stretched over 4800 sqm will showcase the new technology, and its “5 Ts” resonating Talent, Trade, Tradition, Tourism and Technology.
Pavan Kapoor, Indian Ambassador to the UAE remarked, ” It is very clear that by sheer dint of our proportion of the population, by our connections that we have in India, we will be the largest participant at the Dubai Expo.”
The long history of trade and investment between India and the UAE has been further reinforced last year when the top leadership of the two countries convened regular virtual conferences to promote bilateral and trade investment cooperation during the post-pandemic.
Dubai Expo 2020 will showcase the robust India-UAE trade which has seen unprecedented growth over the years which was only valued at 180 million dollars per annum in the 1970s and has currently grown to 59 billion dollars in 2020. The UAE was the third-largest trading partner of India during 2019-20 after China and the US while India was the second-largest trading partner of UAE with an amount of 41.43 billion dollars of trade in non-oil sectors during 2019.
The UAE is a major exporter of crude oil and the Indian government has sought more investments from the UAE in Indian core economic sectors including infrastructure, logistics, defence, ports, highways, airports, renewable energy and food parks. In September 2020, the Consulate General of India, Dubai, and Tea Board India jointly organized a virtual B2B Meet for promoting Indian tea amongst the UAE consumers.
Besides enhancing trade and investment, the two countries also agreed to expand security cooperation and explore opportunities for mutual collaboration for fighting against the pandemic. Current geopolitical instability in many parts of the world has also forced the two countries to look for increased political and economic engagements. With millions of Indian workers employed in the UAE, India has been keen on protecting the interests of its citizens at the time of great economic turmoil.
While UAE scales up investments from India in healthcare, food security and fintech sectors and Dubai company incorporation by Indian investors, the Indian government announces major policy reforms to promote business and investments and attract foreign investors from the UAE. It is no wonder that Dubai Expo 2020 turns out as the perfect venue for enhanced bilateral trade and investment between the two countries.
Dubai Expo 2020 is the biggest event in the Middle East and North Africa (MENA) and will enhance and accelerate the country’s economy with foreign investments pouring in and new business set up in Dubai UAE.
The revival of the world’s economy is also intimately linked to the growth and economic prosperity of these two countries.
- Newsletter, Singapore
- September 14, 2021
Overview
Though Singapore has witnessed a more than fivefold jump in the number of Family offices over the last few years, this wealth and asset management space is still in a phase of infancy with enormous potential for future growth. Most of the family offices in Singapore belong to the first or second generation of Ultra High Net Worth (UHNW) families who are planning for their wealth transfer only for the first time and will keep doing so over many future generations promising a booming market for family office services.
Traditionally, family offices have been popular with well-established structures in Western developed countries viz the US and Europe. However, as the Asian continent has put its strong footprint in the global economy with a high concentration of individual wealth and private capital, there has been a surge of this financial business model in Asia, especially in Southeast Asian Singapore. As per data available with the Monetary Authority of Singapore, there are more than 400 family offices in Singapore, and only 200 of such offices manage an estimated value of assets exceeding 20 billion dollars, a whopping sum.
Family offices are private wealth management entities providing cost-effective financial solutions for UHNW families. Family offices employ financial advisors, investment analysts, legal and tax professionals for wealth and tax planning.
Family offices carry out financial and legal activities which are either carried out in-house or outsourced from external service providers. Activities performed by family offices include management and planning of private assets, wealth protection, succession planning, tax planning, lifestyle management, family governance, education, charities etc. While a Single family office in Singapore caters to one single family, multiple family offices can serve more than one family.
Why is Singapore considered attractive for Family Offices?
Multiple reasons are driving the ultra-rich families to flock to Singapore for establishing family offices post-pandemic. Singapore provides access to both Asian and global opportunities for investments and besides the Asian families, many US and European family offices are being attracted to the country with key family figures opting for residing and taking citizenship of Singapore. The main reasons for exponential growth can be attributed to the below-mentioned reasons.
- Reduced risks of regulatory changes ensuring the safety of assets
- A competitive corporate tax environment irrespective of residence status and tax incentives through Singapore Resident Fund Scheme, Enhanced Tier Fund Tax Exemption Scheme and Global Investor Programme
- Presence of investment and international banks planning to double their operations over next two to three years
- A Matured and Regulated financial market
- World-class Technology
- A recognized international hub for financial services and banking
- Newly introduced Variable Capital Company structures
- Easy settlement for super-rich families through Global Investor Programme
How do Global Pandemic and Geopolitical Uncertainty help flourish the Family Office Space in Singapore?
Global pandemic and geopolitical instability can be a big positive rather than negative for family offices in Singapore. The fear of morality of the pandemic has indeed made the super-wealthy families vulnerable but the uncertainties also instilled a sense of urgency amongst them. Singapore has one of the lowest death rates from the covid pandemic and many billionaires all over the world have been residing for longer in this city-state.
The pandemic has become an important wake-up call for wealthy families to mobilize resources and step up to bring in the positive changes needed in family offices for reviewing and updating protocols and practices within the family office space, investing more time and money for upgrading antiquated ineffective systems and assessing all forms of risk. The geopolitical instability has also raised safety issues of their assets and a need for relocation to a safer and more politically stable jurisdiction.
Covid pandemic has also triggered the possibility of higher tax regimes and stricter regulatory norms in the foreseeable future necessitating the need for wealthy families to explore better avenues for reducing the tax burden. Populist policies with several monetary stimuli introduced during early 2020 may not be viable for long due to inflationary pressure as already hinted by the Federal Reserve on Fed tapering.
In 2020, many billionaires across the world donated several billion dollars for vaccine development and many ultra-rich families were prompted to serve their communities in their countries of origin. This shift in social responsibility has spurred the growth of philanthropic trusts. Philanthropy helps in bringing people together and helps members of wealthy families do something meaningful by participating for a novel cause and reduce bureaucracy in organizations.
The pandemic also provided a big push in smart digital technologies and data securities providing wealthy families better comfort and safety in wealth management. As per recent surveys, more than 80% of family office respondents agree that artificial intelligence can be the biggest disruptive force in global business. More asset management and hedge fund professionals are joining family offices in Singapore and the technology stack is also growing more sophisticated.
Takeaway
The city-state has world-class technology, a transparent and non-bureaucratic regulatory system, a high standard of health infrastructure and a politically stable government and is attracting the super-wealthy families to set up a Singapore family office in preference to their home countries.
As there are plenty of alternatives available for family office structures and governance framework for addressing varying needs and circumstances, it is advisable for wealthy families to partner with a reputable and trusted partner with professional expertise and experience in providing advice on wealth management and implementing customized and appropriate family office structures.
IMC is led by a team of asset management and legal professionals and can help you set up your own family office in Singapore to provide independent and trusted advice on suitable structure, control and supervision keeping in view the long term needs for wealth management and administration.
- Newsletter
- September 14, 2021
OVERVIEW
Cash is oxygen for every organisation and no business can survive without cash in hand. Business expansion and growth are also impossible without a positive free cash flow. Even businesses with very high profitability can close down in absence of liquid cash. MSMEs and Startups suffer the most as they have limited access to finance and in the event of any stoppages in cash flow, the business operations are likely to come to a standstill forcing them to wound up their business either temporarily or permanently.
As any disruption in cash flow can seriously jeopardize the entire chain of business operations ranging from raw materials procurement to salary payment, Cash flow management becomes a matter of tremendous significance for businesses especially the smaller ones.
Cash flow management is a subset of finance and money management and effective implementation could be a serious issue for small businesses with limited professional skills and expertise. Several surveys conducted on MSMEs and Startups revealed that managing cash flow is the biggest of all challenges faced by small businesses during the business life cycle.
WHAT ARE THE REASONS FOR CASH FLOW CHALLENGES IN SMALL BUSINESSES?
Cash flow needs to be managed very prudently by small business owners and strict discipline must be maintained in terms of cash flow forecasting and budgeting. The main reasons for cash flow issues can be attributed to the following
- Unfavourable Payment Terms with Customers and Suppliers can adversely affect the cash flow, early disbursement of payment than that realized can dry up cash flow
- High Inventory especially for manufacturing MSMEs and Startups can block a considerable amount of cash
- High Fixed Costs in the form of debt & interest payment, high rent, high salary etc. can adversely affect the cash flow
- Unnecessary Expenses on non-value-added activities can cause reduced liquidity e.g., marketing expenses that can’t generate leads and grow customer base
- Seasonal effects as financial year-end time can be challenging for cash realization
WHAT ARE THE STRATEGIES FOR AN EFFECTIVE CASH FLOW MANAGEMENT OF MSMEs AND STARTUPS?
Following are the Roadmaps of MSMEs and Startups for an effective cash flow management system.
1. Planning and Forecasting Cash Flow
Cash flow planning and forecasting can lead to better management of working capital, reduced debt and high-interest cost and better evaluation of revenue requirements for handling expenses.
2. Financing of Expensive Purchases
Easy financing is available these days that can be used for expensive purchases and help avoid blocking of a large amount of funds. Instead of paying a lump sum, payment can be made instalments. Governments have also launched many credit facilities to finance capital expenditures of MSMEs and Startups.
3. Utilising Idle Assets and Outsourcing Machinery
MSMEs and Startups with assets e.g., land and machinery not being used for business purposes can rent out or sell such assets for mobilizing cash and address short term cash flow issues at hand. Many small businesses prefer to procure machinery on rent rather than spending on Capex for preserving cash and ensuring business sustainability. The cash generated from rent or sale can be put in a short term investment fund that can earn better interest than a fixed deposit and still be liquid.
4. Negotiating Payment Terms
Based on cash flow forecasting, MSMEs and startups can negotiate with their suppliers for temporarily delayed payments to address cash flow challenges. In many cases, vendors realize the situation and agree on deferring the payments. Similar arrangements can be made with the customers to speed up the realization of funds. Relationship management plays a big role and a lot of effort must go into this.
5. Expediting Recovery of Receivables
Sending invoices immediately after delivery of services and products needs to be the guiding policy of all SMEs and Startups. Fast billing and fast collection of receivables are a must for effectively address the cash flow. Tracking of receivables with continuous follow up on past dues is also extremely critical in ensuring liquidity and optimizing Days Sales Outstanding (DSO). DSO of 30 days or less with a Collection Effectiveness Index (CEI) of more than 80% is generally recommended for small businesses for healthy cash flow.
6. Claiming Advance from Customers
For executing big orders, MSMEs and Startups must negotiate on advance deposits and payments on part deliveries with their customers.
7. Reducing Unnecessary Expenses
Identifying and reducing unnecessary expenses should also be on the agenda of small businesses to effectively address cash flow challenges. They should continuously strive to reduce expenses, save cash, and make regular cash deposits to bank accounts for improving cash flow.
The fixed costs associated with your business must be reviewed critically and periodically to identify opportunities for cost reductions e.g., cosharing of office spaces, online marketing avenues for lead generations etc.
8. Negotiating Price
Though risky and non-viable at times, increasing the price of products and services can help small businesses garner more revenue. Similarly, price negotiations with suppliers can be initiated with strategies planned for a win-win situation. Implementing cost management and cost reduction incentives can also work well and can automatically translate into improved margins without entering into risky price increase with the customers.
9. Reducing Inventory
Reduced inventory can drastically improve liquidity within a system by unlocking a great deal of money. Reduced inventory also helps in reducing wastages and operating cost of the business. For manufacturing MSMEs and Startups, Just In Time (JIT) inventory management system has been hugely successful all over the world.
10. Technology
Last but not least, present-day technologies can help MSMEs and Startups to solve their cash flow puzzle to a great extent. Expense report software for expense management automation and credit card reconciliation. Time tracking software for optimizing staff, Inventory monitoring software for optimized inventory, online payment for speeding up receivables processing, automatic expense monitoring, etc., can help manage cash flow better.
Takeaway
More than 60% of small businesses fail to see the day of light due to imprudent working capital handling and poor cash flow management. In simple terms, delaying cash outlays as long as possible and collecting cash from customers as quickly as possible guarantee an efficient cash flow management system.
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