How does a country make money by becoming a FINANCIAL CENTER?
I read that Singapore became a high-income country, with GDP per capita and HDI more than developed Western Countries by becoming a leading "Finance Center".
My question is how does a country become a financial center and how can you make such huge money by becoming one??
How did Singapore which was a small 3rd world country in the 1950s is now one of the richest countries in the world by becoming a financial center??
What are the nuts and bolts??
Data: GDP per capita of Singapore in 1960 was just $395. In 2003 it was a whopping $22,690. So from 1960 to 2003 Singapore economy has progressed a whopping average of 9.88% a year. How do they achive this type of growth by becoming a financial center. Because to my knowledge, Singapore has no oil or gas (Like Brunei), so they have to create all of that on their own. It is such a small country about 755 km2 and about a few million people means they cannot have huge manufacturing industries also. So how did they do it???
- 9 years agoFavorite Answer
Well for one Singapore is one of the most Capitalist countries in existence. They also have one of busiest ports in the world. They do a great deal of "Trans-shipping".
You are correct as to natural resources. What they do have is an educated population. Some consider THAT the best Natural resource, and I'm not going to disagree. It IS a police state and they do not suffer crime well, Yet most don't mind the invasive nature of law enforcement because of the extraordinary low crime rate. They have, by Western standards, some VERY cruel ways of punishing crime.
As for Financial Centers, well many ARE tiny, but they all have very high standards of living thanks to the old adage "money begets money". The country charges fees and taxes on the banks, not to mention all the high salary bankers!
Of the top of my head I think of The Cayman Islands, Bermuda (houses START around a half MILLION bucks), Liechtenstein(a micro country by Germany,Austria and Switzerland). There are more, I just can't remember them all.