Singapore is not only the biggest Forex trading hub in Eastern Asia but also the third largest Forex trading center in the world after London and New York. Thanks to Singapore’s well-regulated and mature financial markets, the city-state has become a top choice for many international Forex brokers and investors.
Both the banking system and the overall stability of Singapore’s economy make the city-state an attractive destination for Forex trading. In addition, the Singaporean government has taken several steps to promote the development of the Forex industry in the country.
Singapore is the forex trading hub of South East Asia
According to Edward Kendy, a forex expert and the chief editor of world-renowned forex portal BestOnlineForexBroker.com™ “Almost 6.8 trillion dollars are exchanged worldwide and Singapore makes up a large part of that. Singapore is already Asia’s largest forex trading center in terms of volume, ahead of Hong Kong and Japan”. According to reports, Singapore is the world’s third-biggest center, with $640 billion per day.
The country’s stable tax, legal and regulatory systems, and business-friendly environment are some of the reasons why forex trading is flourishing in Singapore.
The Monetary Authority of Singapore (MAS) is the central bank and regulator for all financial institutions in Singapore, including those providing forex trading services. Their initiatives and policies help to promote a safe and secure environment for forex trading in Singapore.
From online forex trading to futures contracts, there are many different ways for investors to get involved in the forex market. As a well-developed and mature financial market, Singapore provides traders with a wide range of products and services to choose from.
How did Singapore emerge as a Forex trading hub?
Singapore’s rise as a Forex trading hub can be attributed to several factors, including:
1. Highly developed economy and world-class infrastructure
One of the key factors that have contributed to Singapore’s emergence as a Forex trading hub is its highly developed economy and world-class infrastructure. Compared to other countries in the region, Singapore boasts a much higher GDP per capita, which creates an environment that is conducive to business and investment. Additionally, the city-state’s first-rate infrastructure means that it can provide the necessary support for Forex trading activities.
2. Pro-business regulatory environment
Another key factor that has helped Singapore become a Forex trading hub is its pro-business regulatory environment. The Monetary Authority of Singapore (MAS) is the country’s central bank and financial regulator, and it has been consistently ranked as one of the most business-friendly jurisdictions in the world. The MAS has a very hands-off approach to regulation, and this has helped to create an environment that is conducive to Forex trading.
3. Low taxes
Singapore’s low tax regime is another key factor that has contributed to its emergence as a Forex trading hub. The country has a very competitive corporate tax rate of just 17%, and this makes it an attractive destination for businesses. Additionally, there is no capital gains tax in Singapore, which makes it an ideal location for Forex traders to base their operations.
4. Regulatory Incentives
The government incentives are part of a larger strategy to position Singapore as a key trading center for major currencies as well as emerging market goods like the Chinese Yuan. In the Asian time zone, one of the goals under the regulator’s industry transformation map or ITM is to develop Singapore into a worldwide price discovery and currency liquidity hub.
The future of Forex trading in Singapore
Singapore is well known for its stable economy and being a financial hub in East Asia. For these reasons, many foreign investors view Singapore as a haven to park their money and this has made the city-state a popular destination for Forex trading.
MAS has been proactive in regulating the online Forex trading market in Singapore to ensure that only legitimate companies and financial institutions are allowed to operate.
Even the government authorities of Singapore have taken a keen interest in developing the Forex trading market in the city-state. The Monetary Authority of Singapore (MAS) has been working closely with the private sector to promote Singapore as a regional hub for Forex trading.
The SingaporeExchange (SGX) is one of the most well-known financial exchanges in Asia and it is also a popular venue for Forex trading.
Many international banks have a presence in Singapore and this has made the city-state a major player in the global currency market. At the moment, there are 119 commercial banks from other countries in Singapore. 28 of them are Full banks, 54 Wholesale banks, and 37 Offshore banks.
All these factors make Singapore an attractive destination for Forex trading. Thomas has been effective in regulating the market and this has made Singapore a safe place to invest in foreign currency.
Singapore’s status as a Forex trading hub is the result of several factors. The country’s highly developed economy and world-class infrastructure are the main pillars supporting the development of the Forex trading market in Singapore. Singapore will remain an attractive destination for Forex traders in the future, due to the MAS’ proactive approach to regulation and the government’s commitment to developing the city-state as a major financial center.