Singaporean banks have widened their service offerings to small and medium-sized enterprises (SMEs) to help them diversify abroad, highlighting the importance of intra-regional advisory services as an enabler of overseas expansion.
A tight local labour market has resulted in more Singaporean firms expanding overseas to offset higher business costs, Channel News Asia has reported. Local banks are looking to help companies diversify across borders by increasing their service offerings, with strong loan activity noticed over 2012.
Linus Goh, Head of Global Commercial Banking at OCBC Bank, said: "Clearly, the recent measures on manpower and availability of space have significantly intensified the focus on cost, and the need to accelerate the search for alternate bases of operations.
"We know that about two-thirds of our SMEs already have some level of activity in the regional markets, so for them, it is a case of shifting the balance of their activities a lot more into the region and maybe less in Singapore."
China, Indonesia, Thailand and Malaysia appear to be favoured investment destinations for the growing companies, with Eric Tham of UOB saying firms are coming to the bank looking for more than funding of late as they seek expertise and advice on expanding internationally. Tax, accounting and licensing advice has come in vogue for Singaporean companies confronted with new and complicated legislative jurisdictions.
SME bankers said companies are moving abroad to get access to manpower and to gain greater economies of scale in production. However, when it comes to the headquarters and research and development, Singapore is still favoured as a regional base in which to conduct operations from. Its idyllic location as well as favourable business environment makes it a perfect springboard for companies to move into the wider Asia Pacific market.
We have offices based in Singapore where our dedicated advisors can help companies seamlessly expand across borders, taking the administrative hassle on board so you can focus on your global ambitions.