Singapore unveils incentives to attract asset managers amid intensifying rivalry with Hong Kong

Singapore just fired its latest shot in the financial cold war with Hong Kong. The Monetary Authority of Singapore (MAS) announced three new measures on August 19 designed to lure and retain top-tier asset managers, a move that reads as a direct response to Hong Kong’s own tax sweeteners rolled out earlier this summer.

The package includes a targeted tax exemption on profit-related returns for fund managers, a new hedge fund investment program backed by MAS capital, and an expanded elite talent visa called the ONE Pass Investment Management Track.

What Singapore is offering

The centerpiece is the tax exemption on profit-linked returns. Rather than slashing headline tax rates across the board, Singapore is zeroing in on the compensation structures that actually matter to senior fund managers: carried interest and performance fees.

The second prong is a hedge fund investment program that will channel MAS capital directly into hedge fund managers expanding their operations in Singapore.

Then there’s the visa upgrade. The ONE Pass Investment Management Track will revamp how salary assessments work for elite talent applications, specifically accounting for the lumpy, performance-linked pay structures common in asset management. A portfolio manager whose compensation swings wildly year to year based on fund performance won’t get penalized for a down year when applying for residency.

Singapore’s asset management sector currently sits at nearly S$7 trillion in assets under management. The industry has grown at roughly 7.5% annually over the past five years, contributes around 15% to the financial sector’s output, and supports approximately 25,000 jobs, about 80% of which are held by locals.

The Hong Kong factor

In June 2026, Hong Kong introduced sweeping reforms to its tax treatment of carried interest and performance fees, broadening the favorable treatment to cover a wider range of asset classes. The move was widely interpreted as Hong Kong’s bid to reclaim ground it had lost to Singapore in recent years, particularly after a wave of wealth managers and family offices shifted operations southward.

Singapore’s approach is notably different from Hong Kong’s in its specificity. Where Hong Kong broadened its tax incentives across asset classes, Singapore is combining targeted tax relief with direct capital deployment and immigration reform.

Why this matters beyond Southeast Asia

The hedge fund investment program deserves particular attention. By directing MAS capital into hedge fund managers expanding in Singapore, the city-state is effectively subsidizing the growth of a sub-sector that has historically been more concentrated in Hong Kong.

The visa reform addresses a friction point that has quietly frustrated recruiters for years. Asset management compensation is inherently volatile. A fund manager might earn S$2 million in a strong year and S$400,000 in a weak one. Traditional visa salary thresholds, designed for corporate executives with predictable pay packages, don’t map well onto that reality. The ONE Pass adjustment acknowledges the industry’s compensation structure on its own terms.

The timing also matters. Announcing these measures in August, just two months after Hong Kong’s June 2026 reforms, sends a message about Singapore’s willingness to respond quickly to competitive threats.

With nearly S$7 trillion in AUM and a growth trajectory that has held steady at 7.5% annually, Singapore is negotiating from a position of considerable strength.

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