Hedge fund managers and other alternative investment firms are increasingly considering moving employees and operations from Singapore to Hong Kong and other financial centres offering more favourable tax regimes, according to the Alternative Investment Management Association.
The industry group said in a letter to the Monetary Authority of Singapore that some of its members were already in discussions with portfolio managers and other senior employees about relocating within the next few months.
AIMA urged Singapore to respond quickly with measures to protect its competitiveness and refresh the city-state’s appeal to global hedge funds, private equity firms and other alternative asset managers.
“These are not isolated accounts,” the association said, citing an unnamed major global manager that reported its Singapore headcount had fallen in recent years while its presence in Hong Kong had grown significantly.
That represented a reversal from just a few years ago, when Singapore had been the firm’s primary regional hub, according to AIMA.
Singapore and Hong Kong have long competed for financial firms and investment talent. Singapore benefited from the disruption caused by Hong Kong’s political unrest in 2019 and the city’s subsequent Covid restrictions, which prompted many expatriates to leave.
Assets under management in Singapore rose 53% in the five years to the end of 2024, reaching SGD6.1tn, according to data from the Monetary Authority of Singapore.
Hong Kong is now seeking to regain ground by introducing a range of tax incentives aimed at attracting global asset managers. Proposed changes, including tax relief on eligible carried interest, could materially increase the after-tax compensation available to successful fund managers.
Hong Kong’s total assets under management rose 20% in 2025 to a record HKD42.2tn, helped by strong net inflows, according to data released this month.
Singapore’s assets under management increased to SGD6.7tn by the end of last year, according to figures cited by MAS Chairman Tharman Shanmugaratnam in a June speech.
Some asset managers have already discussed Hong Kong’s tax changes with Singaporean authorities and suggested measures that could make it easier to recruit international staff, according to people familiar with the discussions.
AIMA said it had also engaged with MAS on the issue and called for broad changes to Singapore’s tax and incentive framework.
Its proposals include lower personal taxes, grants and relief linked to a firm’s Singapore-based workforce, and greater clarity around immigration and residency rules. The association also pointed to the rising cost of operating in Singapore, including property and education expenses.
Individual taxation had emerged as the most important factor for the most internationally mobile investment professionals, AIMA said.
The association added that jobs that did not require a physical presence in Singapore were increasingly being located elsewhere, while some global managers were no longer considering the city-state for new regional operations.
AIMA also called on Singapore’s authorities to communicate their plans publicly, arguing that greater certainty could help firms persuade portfolio managers and other senior employees to remain in the country.
The competitive pressure extends beyond Hong Kong. India’s GIFT City, financial centres in the UAE and other jurisdictions are also seeking to attract mobile investment professionals and firms, AIMA said.
