Singapore ranks most cost competitive in KPMG study

Cindyfeh SG

http://www.channelnewsasia.com/stories/singaporebusinessnews/view/199208/1/.html

SINGAPORE : Singapore ranked first in terms of cost competitiveness in a study by consultancy firm KPMG.

The survey on international business costs covered Singapore, Netherlands and the Group of 7 nations.

The countries were ranked using 27 cost factors including labour, land, utilities and taxes projected over the next 10 years.

This is the first time Singapore is included in the biennial study which began in 1997. .

The KPMG study used the United States as a benchmark and it found that overall, six countries were cheaper while two were more expensive than the US.

Singapore, which was the most competitive country overall, was about 22% cheaper on average to operate a business.

It(Singapore) was also the lowest in terms of labour costs and taxes.

But the rankings also showed that Singapore was less competitive when it came to electricity, energy and telecommunications costs.

Still, KPMG said labour costs made up close to 85% of the total costs of running a business.

And this might work in Singapore's favour when companies decide where to locate their overseas operations.

"Particularly the non-manufacturing businesses, one of the key factors that you see is manpower costs and labour costs are a substantial portion. Some of these other costs that we've talked about are less significant in relation to the cost structure. Therefore, while it's certainly important to look at how we can sharpen our competitive advantage in those areas, they wouldn't be the deciding factors when companies or investors make location decisions," said Satya Ramamurthy, Asia Head of Business Performance Services at KPMG Business Advisory.

Consultants said wages also made up the bulk of costs related to research and development work, giving Singapore a leg up on attracting such projects.

Currently, the study does not include other newly industrialised economies such as Hong Kong, South Korea and Taiwan, although there are plans to widen it.
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1. Can you see the matter of concern here for the average singaporean?
2. Who is really making big bucks out of this so called "most competitive" economy?
3. Who are the BIG LOSERS?

diggo SG

Originally posted by Cindyfeh:
http://www.channelnewsasia.com/stories/singaporebusinessnews/view/199208/1/.html

SINGAPORE : Singapore ranked first in terms of cost competitiveness in a study by consultancy firm KPMG.

The survey on international business costs covered Singapore, Netherlands and the Group of 7 nations.

The countries were ranked using 27 cost factors including labour, land, utilities and taxes projected over the next 10 years.

This is the first time Singapore is included in the biennial study which began in 1997.

The KPMG study used the United States as a benchmark and it found that overall, six countries were cheaper while two were more expensive than the US.

Singapore, which was the most competitive country overall, was about 22% cheaper on average to operate a business.

It(Singapore) was also the [b]lowest in terms of labour costs and taxes.

But the rankings also showed that Singapore was less competitive when it came to electricity, energy and telecommunications costs.

Still, KPMG said labour costs made up close to 85% of the total costs of running a business.

And this might work in Singapore's favour when companies decide where to locate their overseas operations.

"Particularly the non-manufacturing businesses, one of the key factors that you see is manpower costs and labour costs are a substantial portion. Some of these other costs that we've talked about are less significant in relation to the cost structure. Therefore, while it's certainly important to look at how we can sharpen our competitive advantage in those areas, they wouldn't be the deciding factors when companies or investors make location decisions," said Satya Ramamurthy, Asia Head of Business Performance Services at KPMG Business Advisory.

Consultants said wages also made up the bulk of costs related to research and development work, giving Singapore a leg up on attracting such projects.

Currently, the study does not include other newly industrialised economies such as Hong Kong, South Korea and Taiwan, although there are plans to widen it.
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1. Can you see the matter of concern here for the average singaporean?
2. Who is really making big bucks out of this so called "most competitive" economy?
3. Who are the BIG LOSERS?[/b]

Does anyone have the detailed report... it would be interesting...

As for the questions...

1. No impact. We are an industrialised nation in a developing region. So if the same study can be done for the region... this will be more interesting.
2. no comments
3. no comments

abao SG

Originally posted by Cindyfeh:

1. Low wages
2. High bills
3. Equals hard life on civillans

king108 SG

I am actually know bits of utilities, unfortunately, there will be not turned back for the power generation as mostly had switched to gas. (which is cleaner and better combustion). For your information, gas price is normally linked to oil prices unless the contract written in another way.

With the World urging for more energy, the oil price is likely to be up/up all the way. Some countries in Europe had turned back to coal as the fuel to produce electric energy. Before oil and gas were used, coal was the main commodities used for power and piped gas. Coal was once condemned as dirty, but returned to be useful when price of oil~gas had rocketed to the sky.

I would not be recommending that Singapore should change their Power Plant and gas making plants to use coal again. This will incur more capital cost to purchase new plants and equipments. The investment may not be recoverable.

It is unlikely for oil price to drop. Hence, We can only expect to see higher electricity and gas charges in the future. I don't have the figures of the tariffs with me, but if you use the revised price, you may be able to predicted what with the future price, we are going to pay for each unit of energy consumed by us.