ASEAN Market Watch: Fintech in Singapore, Declining Philippine Exports, and Google’s Tax Troubles in Indonesia

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Singapore Signs Agreement with Switzerland in Fintech sector

The Monetary Authority of Singapore (MAS) and the Swiss Financial Market Supervisory Authority (Finma) signed an agreement for greater cooperation in the fintech sector. The agreement was signed during the second dialogue on September 11 between the two regulatory bodies. The agreement aims to create opportunities for fintech businesses to expand into each other’s markets. The treaty will also help businesses understand new regulatory environments and reduce uncertainty when they want to enter each other’s markets. The two regulatory bodies have also pledged to share information on emerging fintech trends and regulatory issues regarding innovation. MAS and Finma will also provide support to the foreign fintech businesses at the same level as like local firms.

Singapore, in August, opened a fintech innovation lab and has already signed similar deals with Australia and the UK.

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Philippines: Exports in Slow Lane

Philippines’ exports declined faster than imports at the start of the second half of the year. Exports dropped 13 percent year after year to US$4.7 billion in July. Eight commodity sectors which showed a decline in exports were machinery and transport; woodcrafts and furniture; mineral products; chemicals; electronic products; apparel and clothing accessories; ignition wiring sets used in vehicles, aircrafts and ships; and metal components. The Philippine Statistics Authority (PSA) said that only coconut oil and other manufacturers rose year on year.

The National Economic and Development Authority (Neda) has blamed the slowdown on a decrease for Philippine products from markets such as Japan, China, Hong Kong and the US. Neda stated that exports must be spread out to non-traditional market such as France and Mexico to address the deficit. The trade deficit stands at around US$14 billion from US$11.9 billion a month ago. Analysts have stated that deficit is expected to remain in the short-to-medium term.

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Indonesia: Tax authorities to investigate Google over unpaid taxes

Media reports on September 15 stated that Indonesia’s tax authorities would investigate Google for suspected unpaid taxes worth billions of dollars from advertising revenue. Tax officials stated that Google did not respond to a letter sent in June requesting the authorities to examine its tax reports. Yahoo, Twitter and Facebook were also asked by the tax authorities to examine the tax reports; all complied with the order.

Tax officials stated that Google only allocated 4 percent of total revenues generated from Indonesia, which was too small of an amount to be taxed. The communications ministry estimates that the value of digital advertising at US$800 million last year, none of which, was taxed. In a similar story, tax authorities are also checking Ford Motor Co. after a news report stated that the company modified its imported Everest model sold in the country to pay a lower tax rate. If Ford is found at fault, it may have to pay back taxes up to four times it owes.


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