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DatabankJanuary 2 2018

Singapore the clear leader among Asean IFCs

Singapore drew the lion’s share of Asean financial services investment in 2016-17, with inflows up at $1.1bn. It also led the outward rankings but value was down on the previous year, in line with the rest of the region. Silvia Pavoni reports.
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If there was any doubt about which financial centre is the most active among Association of South-east Asian Nation (Asean) hubs, foreign direct investment (FDI) data helps clear the picture. Singapore is by far the largest magnet for financial services FDI in the region, with nearly six times the investment that goes into second placed Manila, according to estimates by database fDi Markets for projects between November 2016 and October 2017.

Singapore’s $1.11bn also represents an improvement on its inflows in the previous review period. Among the largest estimated investments into the city-state are Swiss Re’s new subsidiary, which is set to become the Asian headquarters for reinsurance from 2018; and Hubert Burda Media’s Asian headquarters, from which the German firm will invest in technology companies in the region.

Although a distant second, Manila also performed well and its $193m put it in the top 10 inward FDI table after failing to make the cut a year earlier. It is followed by Ho Chi Minh, which unlike the Philippines capital took a hit over the same period. The Vietnamese financial centre attracted only half its previous value.

Outward FDI data confirms Singapore’s dominance in the region: the $261m it directed at other financial centres is double that of Jakarta in second place. Asean hubs appear weaker when it comes to outflows, both in relation to their activity as receivers of FDI – there is sufficient data only for a meaningful top five ranking, rather than the usual top 10 – and in comparison to their performance in the previous 12 months.

An overall decline in outflows is noticeable, and not only in Singapore, as the combined value of the ranked hubs dropped to about one-third of the previous figure.

Singapore leads ASEAN

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Read more about:  Asia-Pacific , Databank , Rankings & data
Silvia Pavoni is editor in chief of The Banker. Silvia also serves as an advisory board member for the Women of the Future Programme and for the European Risk Management Council, and is part of the London council of non-profit WILL, Women in Leadership in Latin America. In 2019, she was awarded an honorary fellowship by City University of London.
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