Globalization lets the bold entrepreneur start doing business anywhere around the world. You just have to assess your preferences and decide where you can make the most of your business concept and the local conditions. With this in mind, here are seven countries around the world that lend themselves to being ideal for foreign entrepreneurs.
The Ease of Doing Business Rank
When you are planning to do business in a foreign environment, it might be worth considering how welcoming that environment is to foreign investors. The World Bank publishes a report each year on the ease of doing business around the world. They consider several factors, and then create an overall ranking based on all of them.
New Zealand ranks first for starting a business and getting credit, while it is also among the top of the crop regarding registering property and protecting minority investors. Locals are highly environmentally concerned and would go a great distance to preserve the natural beauty of their country, which makes it an ideal destination if your startup is based on social entrepreneurship, trying to give back to society and the environment.
For foreign investors, there is an external affairs help desk to support any foreign investment procedure. However, you should keep in mind that the local market is in fact quite small with only 4.7 million inhabitants on the 2 huge islands, while taxes are also high: corporate tax is 28%, while VAT is 13% in New Zealand.
Denmark consistently ranks very high regarding most factors of easy business. The lowest indices are rank 45 for the ease of starting a business (which is still in the middle tier for European company formation), even though registration is fully electronic, and 48 for getting credit. While Denmark accommodates world-class companies in various industries, the country is most well-known for its cleantech companies, thanks to 40 years of working towards ambitions goals in sustainable energy generation and sustainable growth.
Other outstanding fields include biotech, life sciences, and the food industry, which are all characterized by constant innovation. Local talented professionals speak English well, which is a benefit for foreign company owners. While the Danish population is only 5.6 million people, a local company grants you access to the European market. Mind you, Danish corporate tax is 22%, while VAT is 25%.
Singapore can be your strategic gateway to South East Asia if that is where you want to expand your business. However, it offers excellent connectivity to everywhere around the world thanks to its extensive sea and air connectivity. This way while the local population is only 5.6 million, you get access to a vast market through Singapore regardless of which industry you are active in. You will also find that local work force is productive and dedicated to work. While attractive tax frameworks and extensive trade agreements facilitate business and trading across borders, keep in mind that corporate tax is 17%, and GST (goods and services tax, the equivalent of VAT) is currently 7%, to be increased to 9% within a few years.
The United Kingdom was the leader of the industrial revolution, and it has been a leader in various industries ever since. Whichever industry you are interested in, you will find strong infrastructure with constant development, recently with increasing focus on sustainable growth. The population of 66 million brits offers not only a considerable market but also a vast pool of skilled employees.
And while Brexit currently underway might be a reason for some instability, making it not necessarily the best place for European company registration for now, Brexit also promises better positions to the UK with quicker reaction time to global events. The 20% corporate tax and the 20% VAT should also be kept in mind, together with the option for cheap online company setup that lets you start your operation pretty soon.
Hungary is a stable member of the European Union since 2004, which grants access to the entire EU market besides the local 10 million population. It is located in the heart of the continent with excellent infrastructure and connections to every region of Europe.
The procedures for company formation and registration in Hungary make it a great choice when moving your business to Europe thanks to the 9% corporate tax which is the lowest in Europe (although VAT is among the highest with 27%) and the instant EU VAT number that lets you start international trading as soon as your bank account is set up (which lets Hungary rank first in the “trading across borders” category of the World Bank report).
The United States, as the world’s biggest economy, may seem attractive to many investors. It ranks 6th in the overall Ease of Doing Business list of 2019. Many global corporations have their headquarters here, and it is indeed a paradise for free trade and innovation. Before starting a company in the US, however, you should seek detailed advice especially on taxation.
The US law is governed on federal, state and local levels, so the conditions for operating your US company will greatly depend on the state where you are registering it. Moreover, if you also gain US residency, keep in mind that residents of the US are subject to tax on their worldwide income, not only that generated in the USA.
Georgia is located exactly between Europe and Asia, offers significant incentives for foreign investments and business operations in the country, which make it an ideal location for an ethical business. While the local population is only 3.7 million, Georgia is culturally similar and geographically close to Russia, which makes it an easy target country, even is there are some territorial disputes between the two.
The business-friendly community is recognized by various international rankings thanks to its reliable infrastructure, low taxes (5.75% corporate tax, 18%VAT), and high state credit ratings, although company formation is a bit slow, taking about 4 weeks. This is complemented by the Georgia Quick Start training program that supports the education of skilled workforce in fields required by specific companies creating new jobs.
Find Your Place in the World
Before you can decide where to expand your existing business or where to set up a new company as a foreigner, make sure you have a clear vision of what you want to achieve and what are the main requirements of reaching that goal. This way you will surely find the best country for your expat enterprise.