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International location | 11
Singapore or
Hong Kong?
A Conundrum
The Far East offers a variety of excellent business locations.
But that can create as many problems as it solves
by Dermot Butler,
CEO, Custom House Global Fund Services
I
n 2005, we at Custom House decided for Furthermore, Hong Kong is today the gateway Four or five years ago I visited Hong Kong,
a number of reasons – not the least being into China, both in manufacturing and financial Singapore and Sydney, the three major financial
the cost of operating in Dublin – to ‘go services. Hong Kong has always been strong in centre in South East Asia – I exclude Tokyo from
global’ and open offices in Chicago and these areas, although that may be changing. the equation, as it has its own cultural and
Singapore. The Chicago office, which Having said that, there has been a trend over expense problems. I was also planning to visit
opened in the summer of 2005, now has the past few years for those targeting the Chinese Brunei, because I had been invited by the Brunei
almost 70 people, whereas the Singapore venture, market to go direct to Beijing or Shanghai, thus powers that be to consider establishing a fund
which opened its doors in May 2007, now bypassing Hong Kong. Taking everything else administration office there. However, having
employs over 60. into account, I can envisage Hong Kong becom- agreed a date to visit, which was changed several
Many people have asked why Singapore, rather ing less and less important and influential in the times, I was told after I had arrived in the region
than Hong Kong, which I knew better, being a region. that they would have to put off the meeting for
fairly regular visitor since the early 70s. So, why another month. I tore that page out of my diary
did we choose Singapore? Singapore selection and address book. Given the attitude when they
For many years there has been a reasonably Singapore, on the other hand, has grown as a were trying to sell the attraction of the place, it
friendly rivalry between Singapore and Hong financial rather than a manufacturing centre. was horrifying to think what would have hap-
Kong, with both trying to establish themselves as The city has consequently attracted not only spe- pened if we had gone ahead and set up in Brunei.
the financial hub – the Switzerland, if you like – cialist fund administrators such as ourselves, but The choice therefore boiled down to three
of South East Asia. It now appears that they have also the private banking arm of many of the regions. There is no doubt that Sydney came top
each carved out their own positions with sub- world’s leading banks and an increasing popula- of the pile in terms of lifestyle and being a very
stantially different characteristics. tion of investment managers, particularly hedge attractive place to work. But that was cancelled
Hong Kong, which was always a great manu- fund managers. There are a number of reasons out by the fact that it is relatively expensive, high-
facturing centre, has, over the years – and I mean for this. Perhaps I should explain what our ly taxed and a vast distance from absolutely
30 or 40 years – transferred the actual manufac- thought process was when we elected to open in everywhere, including South-East Asia – or at
turing of most of its export products to main- Singapore, rather than anywhere else in the least Hong Kong and Singapore, where many of
land China. region. the clients would be situated.
www.investmentinternational.com March 2009 Investment International
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