Singapore is an attractive destination for trade and commerce. The City State provides investors with many tax and nontax incentives. It allows for extensive freedom of commercial activity, has a well developed infrastructure, an educated and productive workforce and political and economic stability. In 1960, trade and commerce constituted the economy's primary basis of development, reflecting the nation's role as Southeast Asia's premier entrepot.
The Government pursued a policy of Industrialisation through an export-oriented strategy, by attracting foreign investors to Singapore to develop the manufacturing and financial sectors.
The Singapore government encourages International business and investment by keeping regulations to a minimum. Foreign investors can either import capital or raise funds locally. The Government allows the movement of both capital and profit freely within and outside the country. In Singapore there is no capital gain tax, turnover tax, value added tax, development tax or surtax on imports into Singapore.
The Government also brought about improvement in the labour climate and investment environment by enacting the Employment Act to lay down standards of employment to help resolve industrial disputes.
In addition, the National Trades Union Congress (NTUC) and National Wage Council (NWC) also helped to promote better labour-management relations. The Government took various initatives to develop key infrastructure, including the establishment of the Jurong Town Corporation.
The important role that international companies play in the economy in Singapore is another important change. The growth of the manufacturing sector, is a testimony to it.
Over a period of time, the spectacular acceleration of growth reflected the shift to greater export orientation of local firms and the heavy influx of multinational corporations with kicks to the world markets.