Many wealthy Indonesians, especially ethnic Chinese, have increased the placement of their financial assets in Singapore especially since the Asian financial crisis and political turmoil in 1998. There were an estimated 23,000 high net worth individuals in Indonesia, with total assets of US$80 billion. The number of high net worth individuals grew from 17,000 two years ago(1996) , after a boom in commodity and energy prices and in the local stock market. Many wealthy Indonesians also have homes in Singapore and some have listed their companies there.
Three key factors for rich Indonesians in placing their money offshore :-
1) product diversification - flexibility in investing their money in a wide array of portfolios
2) security - prefer to have geographical diversification in order to avoids polictical and security risks
3) tax incentives - Singapore doesn’t have witholding tax on interest so it’s the key thing.
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