Forget Hong Kong … the Best Financial Hub in Asia is Singapore
POR SARKIS ARSLANIAN B, EMPRESARIO EN ALIMENTOS A
NIVEL MUNDIAL, ESTUDIOS EN ECONOMIA, VENEZUELA, EEUU, PANAMA,
As I’ve been saying for months now, Europeans, despite their differences, realize the only real option they have is to look past their centuries-long differences and stand as a united front. The fact that the Greeks of all people – the most put-upon population on the Continent – voted over the weekend to stick to their pro-euro austerity path sends a loud message that the united-Europe experiment is alive.
And that’s ultimately a benefit to Asia, the growth-engine to the world. The Greek vote removes an impediment that has scared global investors for weeks – and that fear has been undermining Asian stocks.
That’s set to change now. As an investor you have to ask: Where do you want your money at work?
I know how I answer that question: I want my money at work in the world’s fastest-growing economies… and Singapore has the fastest-growing economy of all developed nations. That’s part of the reason Singapore was the first stop on my current 16-day investment research trip through Southeast Asia.
In Singapore, you find one of the world’s strongest currencies, the Singapore dollar, backed by one of the world’s largest currency reserves. You find modest government debt, strong investor protections and a host of public companies that lead their industries in fields ranging from shipping and ports to oilfield services to water desalination.
Singapore is the perfect place to profit as both the local economy and the regional Asian economies continue to expand.
Making History, and Clearing a Path to Future ReturnsI saw Singapore’s promise first hand in 2007, when my family was contemplating a move to Asia.
I had opened a brokerage account there several years earlier to own direct exposure to the Singapore dollar, and to own stocks in what is a vibrant economy destined for faster-than-average growth.
Since then, Singapore has emerged as the financial service-center for African and Middle Eastern sovereign wealth funds looking to put their oil and natural resources money to work in Asia, as well as the jumping off point for Western money looking to invest across Southeast Asia.
That’s pumping a lot of money through Singapore’s economy… and it’s a highly developed, well regarded economy. Consider these fun facts about Singapore:
- Ranks as the world’s No. 1 most-open, most-liberal economy
- Is No. 2 among economies with the best investment potential
- And ranks No. 1 in Asia and No. 4 in the world for the lowest level of economic corruption
I’m confident Singapore-dollar-based assets will not only hold their value over time, but will also grow increasingly more valuable in U.S. dollar-terms as the greenback slides.
Singapore also provides the ability for investors to access other regional markets. A number of companies with direct ties to Myanmar, Vietnam, Thailand and other nearby economies are listed on the Singapore exchange, providing a convenient way to play the region’s growth.
In fact, Singapore is the easiest way go get into some of the fastest-growing economies in Southeast Asia.
The effect of all of this is that Singapore has become a financial melting pot, with corporate foot soldiers and investors the world over flocking to the place. That’s benefiting some key Singapore industries like banking, as well as tourism related companies. Regional business travelers – and tourists – now flock to Singapore for its shopping, casinos and its finance.
For all this traffic, there’s only one way in… the Changi International Airport.
Why I Like Singapore Air Terminal ServicesI’m at Changi today, waiting to catch my next flight to Yangon, Myanmar.
One of my favorite high-growth, dividend-yielding Singaporean companies is all around me as I type this. Singapore Air Terminal Services (Singapore: SATS) is visible everywhere you look around this airport. The company is a pure play on Singapore’s tourism and convention push, as well as the investment banking, finance and casino business that are attracting businessmen, investors and gamblers from all over the world.
SATS manages nearly every aspect of Changi Airport: airfreight and baggage handling, passenger services, aviation security, food catering… basically everything happening at this airport. With the country’s tourism on the rise, more passengers and cargo are flowing through the terminals. The stock’s yield is a generous 6.5%.
I recommend buying the stock up to S$2.75.
Until next time, stay sovereign