Becoming a Wealth Management Centre and International Relations Implications: The Singapore Policy Approach and Global and Regional Responses

Abstract

AbstractSingapore's strategic play to secure international wealth management market share has been very successful. Serious questions, however, were raised in relation to this ascendency as the Global Financial Crisis (GFC, beginning in 2007) drove the European Union (EU) and the United States of America (US) to become proactive in clamping down on tax evasion and other areas deemed by them to be undesirable within the international financial system. This paper will examine the Singapore government's decade-long growth policy of its wealth management sector, and how it has been impacted upon by international regulatory responses. Further, it examines how in stark contrast to the EU and the US, Indonesia has been far less successful in its diplomatic efforts to have Singapore address financial diplomacy issues (tax evasion and ill-gotten gains from corruption) in relation to Indonesian citizens residing in Singapore. This article will argue, however, that Singapore's less than robust response to Indonesia's constant requests for action maybe to the long-term detriment of Singapore itself.Economics is now a large part of foreign policy. (George Yeo, May 2005, then Minister for Foreign Affairs, Singapore)Singapore Inc's new growth strategy in a whole range of services from real estate as a new asset class to lifestyle, taps millionaires and billionaires who value privacy, political stability, and sensitivity to money laundering implications. (Low, 2010: 171)