Introduction
Samoa, officially the Independent State of Samoa (formerly known as Western Samoa) consists of the two large islands of Upolu and Savai’i and seven small islets located about halfway between Hawaii and New Zealand in the Polynesian region of the South Pacific. The total land area is 2,831 km2 .The main island of Upolu is home to nearly three-quarters of Samoa’s estimated (2007) population of 188,540, and its capital city of Apia. Samoans officially speak Samoan and English.
Business Environment
Samoa has a stable parliamentary democracy, an economy that is growing at a healthy rate and an investor-friendly business climate. Potential investors can benefit from a streamlined new Companies Act, competitive tax incentives and a sound regulatory environment.
Although Samoa is ranked 39th amongst the 155 countries in the 2006 World Bank ‘Doing Business’ indicators, it still has room for improvement in particular time taken to start a business, acquire licenses, and enforcing contracts.
Economic Environment
The economy of Samoa has traditionally been dependent on development aid, family remittances from overseas, and agriculture and fishing. The country is vulnerable to devastating storms. Agriculture employs two-thirds of the labor force, and furnishes 90% of exports, featuring coconut cream, coconut oil, and copra. The manufacturing sector mainly processes agricultural products. The decline of fish stocks in the area is a continuing problem. Tourism is an expanding sector, accounting for 25% of GDP; about 88,000 tourists visited the islands in 2001. The Samoan Government has called for deregulation of the financial sector, encouragement of investment, and continued fiscal discipline, meantime protecting the environment. Observers point to the flexibility of the labor market as a basic strength for future economic advances. Foreign reserves are in a relatively healthy state, the external debt is stable, and inflation is low.
Taxation
No income tax or other duties or any other direct or indirect tax or stamp duty is payable on the transactions or profits of, nor on the dividends and interest paid by or to, any trust, international or limited partnership, international or foreign company registered or licensed under the various Offshore Finance Centre Acts. Similarly the shareholders, members, beneficiaries, partners or other beneficial owners of such entities are exempt from taxation in Samoa. No tax treaties have been entered into with any countries.
Banking
The Central Bank of Samoa registers and supervises commercial banks in Samoa for the promotion of maintaining a sound and efficient financial infrastructure. Effective counter measures are put in place by the Bank to fight threats that could potentially damage the financial infrastructure which usually occurs from a failed licensed commercial bank.
Offshore Banking
The principal offshore legislation in Samoa is: International Companies Act of 1987, International Trusts Act of 1987, The Offshore Banking Act of 1987, The International Insurance Act of 1988 as amended. International Company’s (‘IC’s’) are companies incorporated in Samoa under the International Companies Act of 1987, but whose business is to be conducted outside Samoa, and which may not do business with any person resident in Samoa.
An International Company cannot trade with Samoans or own local real estate. An International Company cannot undertake the business of banking, insurance, assurance, reinsurance, fund management, the management of collective investment schemes, trust management, trusteeship or any other activity that may suggest an association with the bank or insurance industries without obtaining the appropriate license. A company incorporated in Samoa has the same powers as a natural person.
