Hong Kong vs Singapore for Business in 2025

Looking to position your business in one of Asia’s leading financial hubs? The choice between Hong Kong and Singapore could define your success in 2025. The two are popular business hubs with distinct advantages in Asia, but which one offers the best for your company?

This article provides a data-driven comparison, exploring key factors including economic landscape, business friendliness, taxes, company setup, banking, and more to help you make an informed decision.

Determining a business's potential for development requires a thorough understanding of the regional economy. Let's examine the major economic factors of Singapore and Hong Kong.

Singapore's economies consistently rank in the top five of the IMD’s World Competitiveness Ranking, claiming the top spot in the most recent year. It excels in economic performance, though international trade ranks second, just behind Hong Kong. Hong Kong remains in the top seven, ranking fifth in 2024. Its strengths include government and business efficiency, with international trade in first place and international investment in third. [1]

According to IMF data, Hong Kong's GDP per capita is USD 55.61k, while Singapore's is significantly higher at USD 93.96k. This suggests that Singapore has a higher standard of living and economic output per person compared to Hong Kong. [2] 

According to the Hong Kong government press release, GDP is forecast to grow by 2% to 3% in 2025, with inflation expected to remain moderate at 1.5%. [3] In comparison, the Ministry of Trade and Industry (MTI) in Singapore has forecast GDP growth for 2025 at 1% to 3%. [4] The inflation is expected to increase by 1.2% year-on-year, down from a revised 1.5% in December 2024. [5]

Both Hong Kong and Singapore share financial services and tourism as key sectors. However, Singapore's other key industries include communications technology (ICT) and manufacturing, while Hong Kong’s other focuses are trade, logistics, and professional services.

As a Special Administrative Region of China, Hong Kong benefits from its distinct customs territory and trade policies, providing strong access to mainland China through the Closer Economic Partnership Arrangement (CEPA) and has been facilitating trade between China and the rest of the world. Singapore, on the other hand, is home to the world’s busiest port and serves as a key hub for ASEAN. Thus, a strong connections with countries like Brunei, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam.

Both jurisdictions have free trade agreements with more than 20 economies.

Both Singapore and Hong Kong are highly competitive economies, each offering strong market access but with different focuses. Singapore’s ranking in global competitiveness gives it a slight edge. In contrast, Hong Kong’s strength lies in its close ties with China, along with a forecasted slightly higher growth in 2025.

Hong Kong and Singapore are often mentioned for their business advantages and business-friendly environments. To gain a clear understanding of their overall business climates, we examine the World Bank's data on how favourable jurisdictions are for business across different areas. Let’s take a closer look at what the key data reveals.

The World Bank's Ease of Doing Business Index ranked Hong Kong third and Singapore second in its most recent assessment. However, after 2020, this ranking was discontinued and replaced with the Business Ready index. [6]

Business Ready similarly evaluates the business and investment climate, focusing on areas such as business entry, business regulation and more. 

In the latest rankings, both jurisdictions score highly in several areas. Singapore outperforms Hong Kong in ease of business entry, overall operational efficiency and market competition policy. However, Hong Kong leads in international trade regulations. [7]

The World Bank's Global Indicators of Regulatory Governance rates how well policymakers involve stakeholders in shaping business regulations, on a scale from 0 to 5. Hong Kong scored the highest at 5, thanks to the transparency of its regulatory plans, which are made public to ensure predictability and stability. [8]

Singapore scored 3.5 as its regulations are shared within the government, but not publicly in advance. This can make it harder for businesses to predict upcoming regulations and may result in stricter rules. [9] In both Hong Kong and Singapore, affected parties can request a review or amendment of regulations. 

Both cities offer competitive business climates, but Hong Kong is stronger in trade and regulatory predictability, while Singapore performs better in ease of business entry and operational efficiency. The choice between the two depends on which factors—ease of starting a business or international trade advantages—are more critical for a business's needs.

Both Singapore and Hong Kong are great destinations to incorporate your business. However, the ease and speed with which you can set up your company, as well as the requirements involved, vary. Let’s look into the specifics of each jurisdiction.

Singapore has more obligations than Hong Kong. Both jurisdictions require a local company secretary and a registered address. However, in Singapore, you must also appoint at least one resident director, who must be a Singapore citizen, permanent resident, or hold an EntrePass/Employment Pass.

For remote applications, Singapore requires a SingPass to file online, or you’ll need to hire a qualified agent. If neither option is available, physical presence is necessary. On the other hand, Hong Kong allows you to handle the process yourself. The only exception is if you have a corporate shareholder that is not a Hong Kong entity—physical presence will then be required. This means if you only have individual shareholders, the process can be completed entirely online. Notarised passports by qualified CPAs can be used as identification documents. 

Although Singapore’s government fees are lower, incorporating a business in Hong Kong is, on average, more affordable. Singapore's higher costs are mainly attributed to the requirement for a local director, which often means non-residents need to hire one. Both jurisdictions also require a local registered address and a company secretary, contributing to the overall expenses.

For straightforward structures, the incorporation process in both jurisdiction can typically be completed within a few days, but more complex setups may take longer.

If you have a strong local partnership, Singapore might be a good option due to its lower government fees, as you can fulfil the requirements with a local partner. However, for non-residents, incorporating a business in Hong Kong is generally more flexible and cost-effective. Nevertheless, both jurisdictions offer relatively accessible incorporation processes with online application services. The choice between the two depends on the business's specific priorities and goals.

Taxation significantly impacts your bottom line when running a business. In this section, we break down the corporate tax and related tax structures, helping you determine where you can save more.

• Hong Kong: The Hong Kong corporate tax rate is a flat 8.25% on profits under HKD 2 million, and otherwise, a 16.5% rate on profits above that. Businesses operating entirely outside Hong Kong can qualify for a 0% offshore tax rate. 
• Singapore: The corporate income tax is set at a flat rate of 17%. Companies, whether resident or non-resident, that operate a business in Singapore are taxed on income earned in Singapore, as well as on foreign income when it is brought into Singapore. Overseas income can be exempted if it is not linked to Singapore-based work, partnerships, or business. 

• Hong Kong: No capital gains tax, no dividend tax, No GST/VAT
• Singapore: No capital gains tax, no dividend tax, 9% GST on all sales and good

DTA is a treaty between countries that prevents individuals and businesses from being taxed twice on the same income. It typically provides relief through tax credits, exemptions, or reductions.

• Hong Kong has DTAs with over 50 jurisdictions. [10]
• Singapore has DTAs with over 100 jurisdictions, including both comprehensive DTAs and limited DTAs. [11]

• Hong Kong: General imports are exempt from tariffs. Additionally, foreign tax credits apply if a tax resident pays foreign taxes on income from a DTA jurisdiction. [12]
• Singapore: Startups can benefit from generous tax incentives, including partial tax exemptions (up to SGD 102,500) or a three-year exemption (up to SGD 125,000). The first SGD 100,000 is 75% exempt, and the next SGD 100,000 is 50% exempt. [13] A 400% tax deduction is available for qualifying R&D and innovative projects. [14]

In general, Hong Kong offers lower tax rates. However, Singapore provides a broader network of double tax treaties, which helps prevent income from being taxed twice and may be more cost-effective in the early years if your business qualifies for startup tax incentives. Both jurisdictions offer favourable treatment of offshore income.

Money is at the core of the business, and the ability to manage it effectively within a given jurisdiction is beneficial. A strong banking infrastructure is essential for business growth.

This section will look at the banking systems in Hong Kong and Singapore, focusing on their business banking services and the steps to open a business bank account.

Both Hong Kong and Singapore have long been recognised as financial hubs. According to the Global Financial Centres Index (GFCI) published in September 2024, Hong Kong ranks third globally, while Singapore ranks fourth. The GFCI evaluates financial centres' competitiveness across various factors. [15] 

Additionally, the World Bank’s Business Ready Index, which assesses business climate based on several areas, places both jurisdictions within the top 15 globally in terms of financial service. Singapore scores slightly higher than Hong Kong by about 4 points. [16]

Drawing from different statistics, Hong Kong and Singapore are quite comparable as financial centres.

Both Hong Kong and Singapore offer comprehensive business banking services.

There are over 100 banks in Hong Kong, both local and international, many of which support international transactions. There are 8 digital banks (formerly called virtual banks) in Hong Kong that provide services entirely online. Financial institutions in Hong Kong that provide foreign currency or multi-currency accounts typically include but are not limited to, three base currencies: HKD, RMB and USD. 

There are also over 100 banks in Singapore, predominantly international, along with 6 licensed local banks (DBS, OCBC, UOB, Bank of Singapore, GXS and Maribank). Additionally, there are five digital banks offering entirely online services. Many of these banks provide multi-currency accounts and cross-border payment solutions. The currencies offered vary by bank.

In addition to traditional banks, both locations have alternative non-bank options, like financial technology companies and payment service providers to explore.

Opening a business account with a traditional bank in Hong Kong could be challenging, as they generally require physical visits. Although some now offer remote account opening options, you may need to complete the verification process in person. 

In Singapore, while some banks provide online account openings, non-residents may still need to visit in person. Additionally, high initial deposit requirements may apply.

That said, non-traditional alternatives, such as neobanks and fintech companies, may allow for fully online account setup. However, note that their offerings are technically business accounts rather than business bank accounts. Since they are not actual banks, they will not have typical bank offerings.

Both Hong Kong and Singapore rank highly as financial hubs and offer comparable banking services, with banks and financial institutions providing international remittance and multi-currency accounts. However, traditional business account openings in both locations are moderately challenging, requiring in-person visits in most cases. Both locations offer alternative business account solutions through fintech providers and neobanks, where you may be able to set up accounts online. 

In the most recent World Talent Ranking by IMD, Singapore secured the 2nd spot, while Hong Kong ranked 9th. [17]

Singapore places a strong emphasis on STEM (Science, Technology, Engineering, and Mathematics) education, producing a workforce skilled in science and technology, particularly in life sciences. Meanwhile, Hong Kong's workforce specialises in finance and trade, ranking among the top five for finance skills, management education, and remuneration.[18]

Hong Kong minimum wage will increase from HKD 40 to HKD42.1 per hour, effective 1 May 2025. This applies to all workers except for certain exemptions, such as student interns. [19]

In Singapore, there is no universal minimum wage for all employees. Instead, the country uses the Progressive Wage Model (PWM), which sets minimum wages for specific sectors. For example, the Local Qualifying Salary (LQS) ensures that local workers receive fair wages, preventing companies from offering nominal salaries merely to meet the criteria for hiring foreign workers. The LQS mandates a minimum gross salary of SGD 1,600. [20]

Both jurisdictions are in the top ten in the IMD World Talent Index, indicating strong talent pipelines for both local and international talent. Singapore leads, ranking 2nd versus Hong Kong at 9th. Singapore’s strength lies in its strong STEM education, while Hong Kong focuses on finance and trade.

If you’re specifically planning to do business and relocate, here are key factors to consider when deciding between the two.

In Hong Kong, the work visa and investment visa are key options for relocation. Work visas are general visas for individuals working in a business. An investment visa, on the other hand, allows entrepreneurs to establish or join businesses. For permanent residency in Hong Kong, you must have seven years of continuous residence and demonstrate that your business contributes to the local economy. [21]

In Singapore, the EntrePass is designed for entrepreneurs starting innovative or tech-driven businesses. Entrepreneurs can also apply for permanent residency under the Global Investor Programme. Employment Pass is also available for foreign professionals who earn at least SGD 5,600 to SGD 6,200 a month. There is no official requirement for how long you must be in Singapore to be eligible to apply for permanent residency. However, many sources suggest a length of at least 6 months to 2 years.

While international institutions have not recently ranked global rental costs, multiple sources, such as Mercer, Numbeo, and Forbes, have listed Singapore and Hong Kong among the most expensive places due to high rental demand and limited space. Hong Kong’s rental cost is even more expensive than its mainland China capital, Beijing.

On a related note, the World Bank Index has collected data on another important factor: the business friendliness of property purchase and transfer processes. Singapore and Hong Kong score highly, with Singapore scoring slightly ahead of Hong Kong. [22]

Utility services are another key consideration if you’re looking to set up a physical office. The World Bank Index ranks Singapore 2nd and Hong Kong 8th for the efficiency of essential utilities.[23]  Both are also tech hubs with excellent internet. According to Statista, Singapore ranks 2nd and Hong Kong 3rd globally for internet quality. [24]

Both cities offer high standards of living with robust infrastructure and efficient public transportation systems. In fact, the Hong Kong MTR (Mass Transit Railway) and Singapore MRT (Mass Rapid Transit) are frequently compared, with opinions varying on which is superior.

According to a survey by InterNations of 12,500 expats, Singapore ranks 23rd and Hong Kong 13th in terms of quality of life. However, for overall best expat locations, Hong Kong is ranked 22nd, while Singapore is 27th. [25]

In Statrys' survey, 75% of respondents in Hong Kong are satisfied with their expat life, while 85% in Singapore report overall satisfaction.

In Hong Kong, satisfaction is driven by lifestyle and culture, with cost of living and education also important. Healthcare plays a smaller role. In Singapore, satisfaction is more balanced across lifestyle, cost of living, education, and healthcare, indicating a more well-rounded environment.

Both former British colonies, Hong Kong and Singapore list English as one of their official languages. For other languages, Hongkongers primarily speak Cantonese, while Singaporeans use Mandarin, Tamil, and Malay.

The two places' characteristics also differ. While both are cosmopolitan centres, Singapore is a city-state known for its modern and highly orderly environment, complemented by a year-round tropical climate. On the other hand, Hong Kong presents a more vibrant atmosphere, characterised by a blend of skyscrapers and natural landscapes, including its beaches and hiking trails.

Key business areas in Hong Kong include Central, Tsim Sha Tsui, Causeway Bay, and Kowloon. In Singapore, major business areas are the Central Business District (CBD) and Marina Bay.

Both Hong Kong and Singapore offer solid opportunities for business relocation, though both come with high living costs. Hong Kong may be better if you want a clear PR pathway, but its seven-year requirement may feel demanding. 

Singapore scores higher in utility services, business location, and quality of life. However, Hong Kong ranks slightly higher as an overall top destination for expats. 

Whether you're setting up a business in Hong Kong or Singapore, Statrys can make the process easier.

Statrys provides an all-in-one company incorporation package for both Hong Kong and Singapore. This package covers everything you need, from a registered address to a company secretary, ensuring your business is set up smoothly and remains compliant. Once your company is established, Statrys can also assist in opening a business account (subject to approval).

Got questions? Contact us to get the answers.