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Multiple factors play their roles for any business to succeed with the location of the business being one of the most crucial ones. Investors are gradually showing their interest in Asian countries for establishing businesses due to growing economies, a rise in literacy, infrastructure development, and technological advancement.
Many countries are also offering a number of opportunities and advantages to set up businesses in Asia. The World Bank releases the “Ease of Doing Business Index” every year based on these benefits.
Indonesia, the world’s largest island nation, primarily sustains itself with rich agriculture, oil & gas, and tourism. With an average per capita income of $4,000, the country is the 16th largest in the world in terms of GDP. Indonesia is very lucrative for business because of its natural resources, affordable human resources due to its population of 270.6 million, and growing economy.
Although the country ranks at the 73rd position based on its score of 69.6 on the Ease of Doing Business Index by the World Bank, establishing businesses in this island nation is convenient with its 22% corporate tax. There is an additional 5.7% Social Security tax, out of which 2% is covered by the employees.
The Indonesian government is also hoping to ease the process of starting or doing business in the country compared to neighboring nations by mitigating foreign direct investment.
The 40th nation in terms of GDP with an average per capita income of $11,000 Malaysia is a tourism-rich country famous for its rainforests and sea beaches. With a population of approximately 32 million, the country is growing towards being an industrial nation due to stable technological advancement and infrastructural development.
Placing 12th on the Ease of Doing Business Index with a score of 81.5, Malaysia is a very lucrative nation for businesses large and small. Its geographical placement in the center of the southeast region is also proving to be advantageous. Despite having a 25% corporate tax and a staggering 13.78% social security tax, the country is well ahead in terms of an educated workforce, flexible banking system, and quality of life index.
The Malaysian government has also placed very limited restrictions on manufacturing-oriented businesses, leading to a large influx of migrant workers into the country every year for which employers are able to find and hire an affordable workforce.
Other than businesses, an educated workforce can also be found quite easily as the country is strong in its tourism and education sectors. That is to state, Malaysia is a great option for businesses due to its many conveniences and advantages.
Vietnam, a war-torn country shredded by the largest superpower of the world, the USA, is quite famous for its natural beauty. The agriculture-dependent country ranks 38th based on its GDP with an average income of $3,600 per capita, with 43% of its 96 million surpass population making a living through farming.
In addition, the electronics manufacturing sector is also growing significantly. Due to the country’s skilled and affordable workforce, and geographic location, Vietnam is becoming quite attractive to investors, especially in setting up new businesses,production-based businesses.
With a corporate tax of 25%, the country is quite lucrative for businesses even though they are placed 70th on the Ease of Doing Business Index with a score of 69.8. Although, the registration process for setting up a business in the country takes only one month, which is relative quite a short time.
The country is also well ahead in terms of trade as a result of the Regional Free Trade Agreement with the leading countries. As a result, Vietnam has become a popular destination for investors to set up new businesses.
One of the smallest nations in the world in terms of size, Qatar is globally renowned for its natural gas, Qatar Airways, and as the host of the 2022 FIFA World Cup. Qatar holds the place of the 54th country according to its GDP with an average income of $92,000 per capita.
Ranking 77th with a score of 68.7 on the Ease of Doing Business Index by the World Bank they are still attractive for setting up businesses as its corporate tax is only 10%. Additionally, a large number of foreign labor force migrates to Qatar for employment hence, businesses can attain an affordable workforce quite easily.
Qatar also holds an advantageous position in the import-export sector as they currently have 4 airports and 7 seaports. Including all the benefits listed above, the Qatar government has created special zones where foreign investors can obtain various advantages making the country very lucrative for businesses.
United Arab Emirates
The United Arab Emirates is one of the richest and most oil-rich countries in the world which is home to one of the most expensive cities in the world Dubai, famous for the tallest building in the world, the Burj Khalifa, and the Artificial Palm Islands. At 83,500 square kilometers, the country has a population of over 9.7 million.
The 35th largest country in the world in terms of GDP has a per capita income of more than $35,000 on average and charges no corporate tax, which is one of the unique selling points for the country. With the exception of Petrochemical companies and foreign banking institutions who has to pay a corporate tax. As a result, the country is relatively more lucrative than other countries in terms of doing business.
The UAE is a very prosperous country for tech unicorns. Although there is no corporate tax in the country, companies there have to pay 17.5% Social Security tax, of which 5% is paid by employees. The UAE is ranked 16th in the World Bank’s Ease of Doing Business Index with a score of 80.9.
In addition, a stable financial situation has been created for businesses in the country, which has made the country quite advantageous in terms of foreign investment. Moreover, the legal procedures in the UAE are also very fast-tracked, making it very easy for businesses to get licensed and registered. As a result, new businesses, especially tech companies, are preferred by entrepreneurs in the United Arab Emirates.
Of its prosperous economy, Hong Kong, China’s special administrative region is well known for being a hub for international trade and investments. Hong Kong ranks 37th in terms of GDP with an average of $49,000 per capita. Even though Hong Kong places 3rd, right after Singapore, in the World Bank’s Ease of Doing Business index with a score of 85.3, its corporate tax rate is just 16.5% and 15% for Unincorporated Businesses.
This nation is a lucrative spot for tech companies as it is in the Asia-Pacific region while also sharing its border with the Chinese city of Shenzhen. Being under the rule of the British Empire for a long period of time as a colony, the literacy rate is quite high in Hong Kong and the impact of western culture is quite prominent.
This is why a large number of ex-pats can be found there. With the addition of a Free Trade Policy and a liberal economic system, Hong Kong is a lucrative location for foreign businesses.
Singapore is one of the most developed countries in the world and is a global hub of innovation. Based on an area of just 728.3 square kilometers, the country’s average per capita is $64,000 and is ranked 39th in terms of GDP. It is ahead of all the other countries due to its strategic location and first-class infrastructure.
In the Ease of Doing Business Index by the World Bank holding a score of 86.2, Singapore places at the 2nd position, the highest within the Asian continent. With only 17% corporate tax, technological advancement, and a vibrant ecosystem, the country is a lucrative region for setting up businesses for which unicorn startups like Foodpanda, Grab, Sea, and Lazada have situated their headquarters there.
In addition, the Singapore government has invested more than $3 billion as part of the Research, Innovation & Enterprise Plan 2020, which will further boost the country’s advanced manufacturing capabilities. Singapore is also very convenient for investors to set up new businesses as the country’s rules and regulations for setting up businesses are quite simple and bureaucratic hassles are far less comparatively.
Asia, especially the Middle East and Southeast Asia, is slowly becoming one of the world’s leading trading hubs. A large number of skilled workforce are attracted to migrate mainly due to the infrastructural development of the countries, better living conditions, and civic amenities.
As a result, businesses are also becoming interested in investing in these countries. However, besides these countries, Asian countries like India, Bangladesh, and Thailand are also slowly taking their place. In particular, these countries are getting large amounts of foreign investment every year through infrastructure development and increasing the educated skilled workforce.