As mature economies with rather stable growth rates, the EU and Singapore continue to increase their commercial links – a trend highlighted by the recently published EU-Singapore Trade & Investment 2017 booklet. In effect, the European Union remains Singapore’s most important trading partner when both goods and services are taken together.
Strong trade and investment ties between EU and Singapore
The trade in goods between the EU and Singapore increased by 4.5% in 2016, reaching €50.8 billion. The trade in goods is dominated by machinery equipment and manufactured products, chemicals and fuels as well as transport equipment. Meanwhile, the latest figures on trade in services show a surge of 28% (2015), the culmination of years of growth in this bilateral trade, with non-stop positive figures since 2014. Owing to this remarkable achievement, the EU is Singapore’s first partner for trade in services and its third top partner for goods trade, after China and Malaysia.
Furthermore, the total bilateral investment stocks rose by 25% on an annual basis. The EU’s awareness of Singapore’s achievements in a wide array of fields, such as a provider of top-of-the-line business and transport services and a pioneer on research & development, has crystallized in a European direct investment of €154.1 billion stocks in the city-state. Singapore is thereby the 8th largest destination for EU foreign direct investments worldwide. Conversely, Singapore has a preeminent role as the 9th largest foreign direct investor in the EU, with over €57 billion in investment stocks in the EU in sectors such as telecom, real estate, financial services and energy resources.
Building on this solid economic relationship, the EU and Singapore are looking to proceed with the ratification and implementation of a comprehensive Free Trade Agreement as well as a Partnership and Cooperation Agreement in view of fostering further collaboration in various fields.
EU-Singapore collaboration in research and internationalisation
In recent years, the EU has embarked on several initiatives aimed at boosting two core areas of economic cooperation with Singapore: research & development and innovation as well as internationalisation of small- and medium sized companies.
European companies are contributing to the vibrant research environment in Singapore through investments such as for example the UK electrical appliance company Dyson’s investment in a new R&D Tech Centre in Singapore as well as the Danish water company DHI Group’s expansion of its R&D centre focused on water monitoring and marine environment.
Through the EU Business Avenues in Southeast Asia programme, European SMEs are encouraged to venture abroad and gain exposure to markets in ASEAN by participation in business fairs and networking. The missions cover sectors such as green energy and water technologies, healthcare and information & communication technologies. Moreover, the EU-funded Southeast Asia IPR SME Helpdesk provides invaluable advice to small companies on aspects related to patent and trademark protection. European and Singaporean companies can also benefit from the Enterprise Europe Network, a business-to-business meeting facilitator present in Singapore through a consortium formed by the Singapore Manufacturing Federation, IE Singapore and the Intellectual Property Intermediary Singapore.
Deeper and stronger relations between the EU and ASEAN
As EU-ASEAN relations celebrate their 40th anniversary in 2017, the important trade and economic relationship that links the economies together is highlighted by the fact that the EU and ASEAN have tasked their teams to develop a framework encompassing the parameters of a future trade agreement between the regions. Currently, the EU is ASEAN’s third largest trading partner, whilst ASEAN is the EU’s 5th most important partner for trade in goods. Moreover, the EU is by far the largest direct investor in the ASEAN region, holding almost €235 billion worth of investment stocks. While the vast share of the EU investments are still focused on Singapore, the commitment of the EU to work together with the ASEAN Member States to foster closer economic connections will most certainly propel direct investments sideways among the EU and the ASEAN members.
The EU-Singapore Trade & Investment 2017 booklet will be available on the website of the European Union Delegation to Singapore.
Comments are closed.