Singapore has a highly developed and successful free market economy. They are classified as a high-income economy with a business-friendly environment and strong investment infrastructure. They are the most competitive economy in the world according to the IMD World Competitiveness Rankings in 2024. Singapore’s government is currently forecasting their economic growth to be between 1%-3% with several factors driving their growth. Four of the biggest factors driving their economic growth are, 

• Investment climate: Singapore’s government shows commitment to fiscal policies that support investment initiatives and public spending that drive economic growth. They are able to enhance business efficiency through public infrastructure, business-friendly regulations, intellectual property protection, and efficient customs processes. The current inflow of foreign direct investment in the country makes up roughly 35% of the country's GDP 

• Travel and tourism: Over 13 million tourists visited Singapore in 2023; tourism and travel remains one of the nation’s growing sectors. In February of 2024, the Singapore Tourism Board noted that tourism receipts reached US$24.5 – 26 billion 

• Human capital: According to the most recent addition of World Bank Human Capital Index, Singapore is currently the best in the world in human capital development. This is in large due to Singapore’s strong investments in infrastructure, education, healthcare, and public services. 

• External demand: Singapore depends highly on external demand. Global trade and increases in manufacturing are vital for Singapore’s export-dominated economy to thrive. The value of the nation’s total exports in services more than doubled from 2014 – 2023. While they are the most competitive economy, they are also one of the smallest with little natural resources. Singapore’s economy is dependent on external demand and the global economy which makes them vulnerable to economic changes worldwide. 

Economically Singapore’s benefits international businesses largely in part because of their location. They are essentially a gate way for businesses to access other major Asian markets by utilizing the well develop ports in Singapore to facilitate global trade. Other than their physical location Singapore also benefits international business through finance and investment do to their stable political environment and pro-business policies.