Singapore is a highly developed trade-oriented market economy.[10][11] Singapore's economy has been ranked as the most open in the world,[12] 7th least corrupt,[13] most pro-business,[14] with low tax rates (14.2% of Gross Domestic Product, GDP)[15] and has thethird highest per-capita GDP in the world; in terms of Purchasing Power Parity (PPP). Government-linked companies play a substantial role in Singapore's economy, which are owned through the sovereign wealth fund Temasek Holdings, which holds majority stakes in several of the nation's largest companies, such as Singapore Airlines, SingTel, ST Engineering and MediaCorp. The economy of Singapore is a major Foreign Direct Investment(FDI) outflow financier in the world. Singapore has also benefited from the inward flow of FDI from global investors and institutions due to her highly attractive investment climate and a stable political environment.[16]
Exports, particularly in electronics, chemicals and services including the posture that Singapore is the regional hub for wealth management[17][18][19] provide the main source of revenue for the economy, which allows it to purchase natural resources and raw goods which she lacks. Moreover, water is scarce in Singapore[20] therefore water is defined as a precious resource in Singapore along with the scarcity of land to be treated with land fill of Pulau Semakau. Singapore has limited arable land[21] that Singapore has to rely on the agrotechnology park[22] for agricultural production and consumption. Human Resource is another vital issue for the health of Singaporean economy.[23] The economy of Singapore ranks 5th overall in the Scientific American Biotechnology ranking in 2013 for two consecutive years.[24]
Singapore could thus be said to rely on an extended concept of intermediary trade to Entrepôt trade, by purchasing raw goods and refining them for re-export, such as in the wafer fabrication industry and oil refining. Singapore also has a strategic port which makes it more competitive than many of its neighbours in carrying out such entrepot activities. Singapore has the highest trade to GDP ratio in the world, averaging around 400% during 2008–11.[25] The Port of Singapore is the second-busiest in the world by cargo tonnage. In addition, Singapore's port infrastructure and skilled workforce, which is due to the success of the country'seducation policy in producing skilled workers, is also fundamental in this aspect as they provide easier access to markets for bothimporting and exporting, and also provide the skill(s) needed to refine imports into exports.
Singapore's government promotes high levels of savings and investment through policies such as the Central Provident Fund, which is used to fund its citizen's healthcare and retirement needs. Singapore's savings rates have remained among the highest in the world since the 1970s.[26] Most companies in Singapore are registered as private limited-liability companies (commonly known as "private limited companies"). A private limited company in Singapore is a separate legal entity, and shareholders are not liable for the company's debts beyond the amount of share capital they have contributed.
To preserve its international standing and further its economic prosperity in the 21st century, Singapore has taken measures to promote innovation, encourage entrepreneurship, re-train her workforce, and even attract foreign talents. These measures aim to boost Singapore's productivity, so that Singapore remains competitive and ready for the challenges of an information-driven global economy.
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