In light of the influx of wealth and the growing wealth gap in Singapore, the country raises the bar for global investors seeking permanent-resident status. The move aims to encourage more local jobs and investment in the city-state’s stock exchange and funds.
According to the Singapore Economic Development Board, applicants must have a minimum of S$10 million ($7.4 million) invested in a business or S$25 million in an approved fund. The changes will take effect on March 15th. For those establishing family offices, the minimum required investment will be at least S$50 million, to be deployed and maintained in four government-designated investment categories.
The new requirements represent a significant increase from the previous threshold. That only required a S$2.5 million investment in a business entity, fund, or Singapore-based single-family office.
Since introducing the Global Investor Programme in 2004, the program has provided a pathway to permanent residency for the world’s wealthiest people.
In the last two years alone, the program has granted 200 permanent residencies and created more than 24,000 jobs. Additionally, it brought in at least S$5.5 billion in investments.
However, the arrival of rich families from overseas has contributed to a spike in costs for everything. That trend affects luxury cars, golf club memberships, and condominiums.
The government is fine-tuning its policies to address this issue to encourage more local jobs and investment. Therefore, it announced a tax hike on the higher-value property and luxury cars.
The investment program refinement will likely benefit the country’s asset management industry and companies receiving funding. As Desmond Teo, EY Asean private tax leader, stated in a recent press release, the refinement will “encourage the growth of businesses and capital accumulated in Singapore.”
The country’s reputation for infrastructure and stability has attracted many ultra-wealthy individuals. It is estimated to reach around 2,800 high-net-worth individuals in 2022 alone.
Residence and citizenship planning provider Henley & Partners estimate that 249,800 residents in Singapore have a net worth of at least $1 million, making it the world’s fifth wealthiest city.
In addition to the new investment thresholds, the Singapore government is encouraging more investment in the city-state’s stock exchange and funds while fine-tuning policies to create more local jobs.
The changes to the Global Investor Programme will likely create a more balanced wealth distribution in the city-state. Additionally, they will attract more foreign investors looking for a stable and prosperous location to invest their wealth.