How the Four Asian Tiger Countries Drive Global Expansion

Have you ever heard of the Four Asian Tiger countries?

Hong Kong, Singapore, South Korea, and Taiwan are popularly referred to as the Four Asian Tigers or Asian Dragons. These four countries were awarded this title because of their high-growth economy.

Since the 1960s, these countries have consistently maintained high economic growth and have collectively joined the ranks of the world's wealthiest nations. Fueled by exports and rapid industrialization, these four economies provide successful examples of global expansion.  

Each one of the Four Asian Tigers shares common characteristics that contribute to their economic success. From having a sharp focus on exports and an educated population to high saving rates and relatively low corporate tax structures, Taiwan, Hong Kong, Singapore, and South Korea drive global expansion to new heights.  
Being one of the world’s most advanced economies isn’t an easy task. However, these Asian Dragons have achieved this status and proven their resilience despite facing local crises, such as the 1977 Asian financial crisis, and global shocks, such as the 2008 credit crunch.

These four countries are praised for their ability to transform economies, implement effective economic policies, and adapt to changing global market conditions.
In this blog, we’ll outline five factors contributing to their expansion and deep dive into how these countries drive global expansion through economic strategies, business-friendly environments, and competitive advantages in key industries. 

Asian Dragons Driving Global Expansion

The Four Asian Tigers have been pivotal in driving global expansion in Asia. Whether it’s Hong Kong's free-market policies and strong financial sector, Singapore's strategic location and focus on trade, South Korea's focus on technology and manufacturing, or Taiwan's export-oriented economy and investments in technology, strategic economic policies have played major roles in the economic development of these countries.

Here are a few ways the Asian Dragons drive global expansion: 

Economic Strategies

As a result of export-oriented policies and strict development regulations, these four economies achieved economic growth and high levels of fair income distribution.

Hong Kong uses economic strategies such as the free-market economy in which the prices of goods and services are determined in a free price system. This means the price of goods and services is determined based on demand and supply rates. Hong Kong noticed a rise in income and demand for goods and services and various implemented supply-driven economic strategies. Since Hong Kong was considered a shelter for those fleeing Mainland China, it became a Special Administrative Region (SAR) of China. This strategy provided Hong Kong with the freedom to conduct business and expand its economy until the year 2047.

In contrast, Singapore is more actively promoting start-up businesses and intends to support them in internationalization and research and development initiatives. Apart from this, Singapore also prioritizes data security and collection. These practices promote data privacy compliance while also encouraging data science expansion and global connectivity. By focusing on international trade and meeting international data protection laws, Singapore drives global expansion.

Taiwan has experienced an economic miracle. Because of an unfavorable land-to-population ratio, its lack of natural resources, limitations for capital, and a discredited government, Taiwan’s economy was predicted to go downhill. However, the economy grew because of the growth of textile factories and light manufacturers. These manufacturers eventually started producing electronic equipment. This resulted in Taiwan becoming one of the world’s largest producers of computers and other electronic goods. Taiwan's export-oriented economy and investments in technology maintain and drive economic growth.

Like Taiwan, South Korea also had the miracle of the Han River, which was the reason for economic expansion. With an aging population and one of the lowest fertility rates in Asia, South Korea needed a solid plan for its economy. South Korea focused on its thriving industrial sector and electronics exports to drive global expansion. 

Business Friendly Environments

By setting up business-friendly environments, the Four Asian Tiger countries attract international investment and promote innovation and development within these countries. This leads to an increase in the country’s Gross Domestic Product (GDP). A country’s GDP is often used to measure a country’s economic health. A country’s economic health represents the value of all goods and services produced over a specific time period.

Hong Kong

Hong Kong is a major financial hub in Asia. It’s known for low taxes and free-trade policies. As a popular tax haven, Hong Kong’s low corporate tax rate of 16.5% attracts foreign businesses and encourages foreign investment.

Singapore

Singapore offers foreign businesses efficient regulations and a technology-friendly environment, thus making Singapore a hotspot for tech companies and startups. Singapore's vibrant technology-based ecosystem even ranked fifth in all of Asia. Apart from this, Singapore has an easy incorporation procedure, offers intellectual property protection, and a low corporate tax rate of 17%. Additionally, Singapore has dethroned Hong Kong as the world’s most free economy.

South Korea

Ranking number five in the Ease of Doing Business, South Korea is a hotspot for those looking to expand their business. South Korea's focus on innovation and education has driven it to lead industries like electronics and automotive manufacturing.

Taiwan

Apart from its strong manufacturing base, Taiwan emphasizes research and development. Approximately 3.96% of Taiwan’s GDP was spent on research and development in 2022. Taiwan's free market economy and well-developed physical infrastructure make it a suitable option for businesses looking to expand. The Taiwanese government also offers incentives and favorable policies, such as no minimum capital investment to start a business.

Competitive Advantages in Key Industries

South Korea has a strong presence in the technology and electronics industry, with companies like Samsung and LG leading the way in innovation.

Taiwan has a strong presence in the semiconductor industry, with companies like TSMC dominating the market.

Hong Kong and Singapore, on the other hand, are established financial and trade hubs with financial centers or headquarters. Their strategic geographical locations also provide a competitive advantage ideal for dominating key trade industries. 

Contributing Factors for Global Expansion

Several factors have contributed to the success of the Four Asian Tigers in their global expansion efforts. Combining the following factors has helped these Four Asian Tigers become successful players in a competitive global market. Their rise to a successful expansion showcases the importance of proactive economic policies, investment in education and technology, and a commitment to developing favorable infrastructure that encourages hiring employees globally and integrating employees into foreign businesses.  

Technological Innovations

One of the biggest factors that all Four Asian Tigers share is their technological innovations. Recognizing the importance of technology and how valuable technological literacy is, they started to develop a business culture around it. For example, Taiwan’s foreign investment policy focuses on maintaining tech leadership. Taiwan is a technology hub and has developed infrastructure, an industrial base, and various research and development facilities accordingly.

While all four economies encourage technological innovations, Taiwan and South Korea specifically have prioritized investing in research and development, manufacturing, and innovation. By doing so, these countries stay ahead of the curve in industries including electronics, telecommunications, and biotechnology.

Skilled Workforce

Hong Kong, Taiwan, South Korea, and Singapore all recognize the importance of having a skilled workforce and how it positively contributes to global expansion measures. This is why all Four Asian Tigers have heavily invested in education and skill development. For example, Singapore has an adult literacy rate of 97.6%.

Since the Four Asian Tiger countries ensure citizens have access to quality education from a young age, local and foreign employers benefit from hiring skilled employees in Hong Kong, Taiwan, South Korea, and Singapore. Employees in Taiwan, Hong Kong, and the other Asian Tiger countries are supported by policies and programs that encourage employees to further upskill from their current skill sets. Singapore’s Skills Future Credit is an initiative that empowers Singaporeans aged 25 and above to upskill their current skills or re-skill in a new industry. Employees in Singapore taking part in this project even receive an open credit of $500 for professional development opportunities.  

Infrastructure Development

Following their status as sovereign nations, the Four Asian Tiger countries rapidly started rebuilding their infrastructure. The development of these infrastructures plays a crucial role in facilitating the movement of goods and services, as a developed infrastructure paves the way for economic growth and development.

Taiwan and Singapore are island countries, while South Korea and Hong Kong border major bodies of water. By developing their infrastructure, these countries are less reliant on foreign aid in emergencies. Apart from this, having a flourishing infrastructure with airports, seaports, power supplies, roads, internet access, and many other physical and organizational structures, both countries became a hub for businesses looking to expand their presence in Asian markets. 

Favorable Trade Policies

The four countries have applied different trade policies favorable to businesses. Singapore and Hong Kong implemented neo-liberal trading regimes that promoted free trade. In contrast, Taiwan and South Korea opted for a hybrid policy that best suits an export-oriented economy.

These trade policies prioritize open markets, free trade agreements, and export-driven strategies that help strengthen trade relationships with other countries and foreign business owners looking to expand internationally.

Strategic Geographical Location

Each one of the four countries benefits from its strategic geographical location since it serves as a gateway to the Asia-Pacific region and provides easy access to major Asian business markets, trade and commerce hubs, and access to a large pool of educated and skilled professionals across Asia.  

Expand in the Asian Market

Are you looking to expand your business to the Asian market? Employee benefits and perks such as annual leave, sick leave, or flexible working hours aren’t sufficient to attract and retain employees.

Here are a few tips that help businesses around the world enter and conduct business while attracting top talent in a rapidly developing Asian market: 

• Understand Cultural Differences: Southeast Asia is a diverse part of the world and has distinct cultural norms and practices that are different from Western countries. Understanding cultural norms and having local insights or researching the cultural nuances ensures a smoother entrance and transition into the Asian market.

• Examine Market Trends and Consumer Behaviors: While the Asian market is home to financial and trade hubs, the market and consumer behavior differ from Westerners. For example, most Asian consumers believe that brands matter and that bargaining is a viable method to get a good deal. These consumer-behavioral differences are a major reason why anyone looking to expand in the Asian market must conduct adequate research on current market trends and behavior.

• Build Local Partnerships: Entering a new market in a different part of the globe comes with a list of challenges, ranging from language and cultural barriers to a lack of local knowledge regarding local labor laws and other compliance-related concerns. However, by partnering with an Employer of Record (EOR), companies effectively navigate the complexities of Asian markets. An EOR ensures you meet all the required employment laws to avoid non-compliance penalties and fines, which can also include significant reputational damage, business interruption, and more. 

Why Borderless AI?

With an Employer of Record (EOR) like Borderless AI by your side, you can easily expand your business horizons and hire employees in South Korea, Hong Kong, Singapore, and Taiwan.

Our AI-powered platform allows you to hire, manage, and pay employees in over 170 countries worldwide with zero up-front costs. 

We also offer access to Alberni, the world’s first AI agent for global employment. Within seconds Alberni will create employment contracts, provide powerful insights regarding global hiring costs or other relevant queries, and review your contracts so you can experience the future of global HR. 

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