Starting a business is always a challenge, especially as a foreign investor or expat in a new country. There are several things to consider, from corporate tax rates and trading laws, to what kind of business you hope to run and where your market is likely to be.
These factors can vary hugely from country to country, so where in the world offers the optimum climate to launch a business as an expat? Ireland, Switzerland, the United Arab Emirates (UAE), Singapore and the US (in that order) are the best countries in which to start a business in 2023, according to new analysis by William Russell, an international insurance provider.
“This study provides valuable insights for entrepreneurs and expats looking to start a business abroad,” said William Cooper, a health insurance and expat expert at William Russell. “It is crucial to consider not only the business environment but also factors like healthcare, which can greatly impact an expat’s quality of life. The top-ranked countries on this list not only offer great business opportunities but also have strong healthcare systems in place, which is a key consideration for expats.
“Moreover, we understand the cost of living crisis affecting many people today. Our study shows that some of the countries on the list offer a lower cost of living than traditional start-up hubs, making them attractive destinations for entrepreneurs looking to stretch their budgets without sacrificing their quality of life.”
Among the country’s key attractions is its incredibly low corporate tax rate of just 12.5%, one of the lowest in the world. Since corporate tax is charged on profits, this low rate is ideal for businesses that are just starting out and have not had the chance to make a large profit yet.
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The export market is another draw for Ireland. Over the past few years, the country’s export market has grown significantly – with the value of food, drink and horticulture exports increasing by 4% to a record €13.5bn ($14.59bn) in 2021 alone, despite the impact of Covid-19 and Brexit on trade. Other Irish exports include pharmaceuticals and tech-based exports.
Ireland is home to the European headquarters of several leading worldwide companies – eight out of the top ten global pharmaceutical companies and 50% of worldwide financial service companies are based in the country. Ireland is also home to the European headquarters of social media giants such as Twitter, LinkedIn and Facebook.
While not part of the EU, Switzerland is a close economic ally, which opens up many valuable trading opportunities for Swiss business owners. For one, the country has access to the European single market, meaning it can trade freely with every member of the EU.
More importantly, Switzerland boasts one of the best workforces in the world. In September 2022, the unemployment rate dropped to 1.9%, the lowest since 2001. It is also one of the few countries with a good employee retention rate, with just 10% turnover.
Switzerland is, historically, politically stable, making it an ideal place to start a business. The lack of political upheaval means that the country has a stable economy, well-established trade agreements and a clear path for its future, all of which are important things to consider when choosing a country to start a business.
The UAE is a hub for new businesses. Beyond its tourism, real estate and consultancies, the country’s main draw for new businesses are its free-trade zones.
A free trade zone (also known as ‘special economic zone’) is a geographical area, most often located in and around seaports and international airports, in which businesses import, trade and export goods with 0% tax rates. Free trade zones can also be used by software, research and financial-based companies, making the UAE a very popular place to start a business.
While there is currently no corporate tax in Dubai, this will soon change. As of June 2023, the UAE will introduce corporate tax to secure its place as a global business hub. However, at approximately 9%, the tax is still one of the lowest in the world, and it will not affect free trade zones.
There is also a distinct locational advantage to starting a business in the UAE. As the midpoint between East and West, the UAE facilitates business connections that might never have happened otherwise. If one is looking for networking and potential collaborating opportunities, the UAE is among the best places to start a business.
Singapore is one of the most underrated countries in which to start a business. It has a flat corporate tax rate of 17%, a stable government and economy, and excellent trade agreements with several countries across the world.
With 27 different free trade agreements, Singapore has eliminated most of the tariff charges that are usually present when trading internationally. This, along with its simple business set-up process, makes the country one of the best places to start a business.
The stable government and economy are big draws for businesses. Singapore is regarded as the most politically stable country in South East Asia, and as a result crime rates have remained consistently low and the economy has prospered.
Even though Singapore’s economy took a dip during the Covid-19 pandemic due to its reliance on international trading, it has recovered well and is continuing to grow.
The city-state is a prime location for networking with the business giants of mainland Asia, as well as international companies with headquarters in Singapore, such as Google.
If tech is a company’s focus, then the US is calling – or, more specifically, San Francisco. The San Francisco Bay Area is famed for having the highest concentration of high-tech companies in the US, boasting easy access to Silicon Valley and the brightest science, technology, mathematics and engineering minds, possibly in the world.
As of today, San Francisco is home to six Fortune 500 companies, more than 1,900 technology companies, 120-plus biotech companies and over 200 cleantech companies. There could not be a more inspirational place to start a business.
The US is one of the most foreign-friendly countries to start a business and its start-up ecosystem is rated first in the world. Along with San Francisco’s plethora of tech start-ups, the US as a whole is also a thriving hub for ecommerce and retail, education and energy and environment businesses.
Registering a business in the US provides instant international standing, making it easier to attract financial backers and international partners. As the leader in the global market, the US also provides access to worldwide economies, offering businesses unparalleled growth opportunities beyond their start-up years.