Singapore has shown remarkable economic growth in the past 10 years. Today it is considered one of the highest economy cities. The growth is driven by many factors like consumption and expenditure, international and local demand, and investments. PESTLE is a tool that is implemented to analyze the macro-environmental factors of Singapore’s leading sectors like petroleum and pharmaceutical industry. PESTLE analysis is an acronym for political, economic, social, technological, legal and environmental factors. Now let us see the PESTLE analysis of Singapore.
Political: The risk of political factors in Singapore is very low. According to a report by the Political and Economic Risk Consultancy (PERC), Singapore has the lowest political risk in the country. Stability in the political environment has led to augmented business solutions in Singapore.
Economic: Singapore consists of a vibrant free economic market. According to ASEAN, the country has the highest per capita income. The government is also investing in the market to diversify the economy of the country. Pharmaceutical, tourism and many others have flourished due to this. Cheap labor from the neighboring countries helps the economy of Singapore to save a lot of costs. But there are some constraints also that may behold the economic performance of the country. Those factors are:
- Shortages of labors
- High costs of labors
- The decrease in productivity
Social: Singapore follows all the social traditions just like any eastern country. It follows traditional values. The younger generation is now following western values. The urge to do socially well has resulted in an increase in productivity. The business is seeing a rise in sales due to the high purchasing power of the customers. The people of Singapore hate construction jobs. Due to the high literacy rate in the country, trade and foreign investment are also much thrived in Singapore.
Technology: Advancement of technology, easy communication, and increasing connectivity is another factor for the economy enhancement of the country. Due to technology time and costs of conducting business have reduced. The widespread operations of the IT infrastructure have resulted in the settlement of regional offices of the MNCs in Singapore. The government is also encouraging this electronic era.
Legal: Singapore has employed some initiatives for e-commerce businesses. There are cross border policies and laws also. Some of the laws and regulations that are common in Singapore are Intellectual Property Rights, Regulation of the content, procedures for import and export, electronic transactions act, tax issues, and amendments to the evidence act.
Environment: In the urban areas of Singapore, air pollution due to transportation is the main problem. Singapore was among those countries with the highest amount of emission of carbon dioxide. 30% of the mangrove area of the country is damaged. There is also pollution due to the production of oil byproducts. As a result of this pollution, water is consumed after desalination and recycling. Due to a lack of water supply, Singapore is dependent on Malaysia for water.
After analyzing all the above factors, we have concluded that Singapore has come up high in a remarkable way. The government of Singapore has offered great business opportunities for both international and domestic platforms. The continuous development of the country has made it a major competitor in the business world of the international market.