Opportunities to Expand to New Markets: Singapore

In October 2018, the EU signed the long awaited trade and investment agreements with Singapore. The new regulations will help companies benefit from easier exchange of goods and services, enhanced investment and facilitatеd labour market between Singapore and the countries from the EU. The EU-Singapore trade and investment agreements led to increased interest from Central and Eastern European countries such as Poland, the Czech Republic, Hungary, Romania etc. to work hard over exploring the opportunities of doing business with Singapore.

This article aims to help Bulgarian companies interested in market opportunities in Singapore by providing key facts on the agreements and useful links to more detailed information about the regulations in the different sectors and types of activities. You will also find a list of organisations providing consultancy and trade support services to facilitate the bilateral partnerships between Bulgaria and Singapore.

A snapshot of the EU-Singapore trade

Singapore is the 20th smallest country in the world with a population of 5.6 million people, but it is the EU’s 14th largest trade partner in goods, as well as the biggest partner for the Union in the region of Southeast Asia. In 2017, bilateral trade in goods amounted €53.3 billion, with the EU exporting €33.16 billion, mainly cars and machinery, while importing €20.14 billion, in particular chemicals and pharmaceuticals.

The country is a gateway to Southeast Asia and a major transport hub.  It has an extensive network of trade agreements with over 30 trading partners and trades more than €550 billion with the rest of the world every year. Over 10 000 European companies have set up their offices or regional hubs in Singapore. With a very service-oriented economy, Singapore is also the EU’s 5th largest worldwide trade partner in services and the EU’s 6th destination for foreign direct investment measured in stock.

Benefits under the EU-Singapore agreements

The EU and Singapore negotiated and signed two agreements: the Free Trade Agreement (FTA) and the Investment Protection Agreement (IPA).

Strategic benefits:

1. Before the agreement, almost all goods from the EU could already enter Singapore free of customs duties. The FTA will now eliminate the remaining tariffs within three to five years, depending on the product category.
2. On top of the classical removal of customs duties, the agreement will also tackle non-tariff barriers:
   1. on marking, labelling, etc.
   2. Singapore will recognise current EU standards and testing on cars and car parts
   3. Singapore will avoid duplicative safety and electromagnetic compatibility testing for certain electronic products
   4. FTA will facilitate trade and investment in renewable energy equipment
   5. FTA will facilitate exports of EU products of animal origin by evaluating inspection and certification systems rather than individual establishments
3. More efficient customs procedures to facilitate trade, while bolstering supply chain security through strengthened cooperation.
4. Modern rules to protect and enforce intellectual property rights.
5. Preferential market access opportunities for respective service providers, such as: telecommunications, finance, computer services, transport, environmental services, certain business services and postal services, etc.
6. More opportunities for EU firms to compete for public procurement contracts in Singapore.
7. Binding commitments on environmental protection and workers’ rights in line with international standards and agreements.
8. Provisions to enhance trade and investment’s contribution to sustainable development:
   1. corporate social responsibility
   2. sustainability assurance schemes
   3. conservation and sustainable management of natural resources.
9. A high level of investment protection and modern and reformed investment dispute resolution mechanisms.

Although the trade and investment agreements with Singapore do not include a specific chapter dedicated to small and midsize businesses, they do contain provisions to simplify trade and investment procedures and reduce export and investment-related costs. This will help more small companies to do business in both markets.

Useful links

European Commission, EU-Singapore Agreement – the page contains fact sheets about the agreement, information page about the trade relations between the EU and Singapore, exporters’ stories and more

Trade Helpdesk of the EC – the trade relations between the EU and Singapore in figures

Regulatory divergences in some key sectors

The European Chamber of Commerce in Singapore

Infographics and useful links from the Ministry of Trade and Industry of Singapore website

The EU-Singapore agreements explained on the website of the European Commission

Organisations providing consultancy and trade support services:

Ministry of Trade and Industry of Singapore

The European Chamber of Commerce in Singapore

BSiP Alliance – organisation, dedicated to helping Bulgarian businesses enter and succeed in Singapore, as well as helping companies in Singapore discover and leverage the potential of Eastern Europe both as a market and an entry point for the rest of Europe. BSiP is actively engaged with the Bulgarian community in Singapore and supports sectors such as public and private finance, marketing, F&B, tourism, education, IT, engineering, shipping and others.

The official opening of the Central and Eastern European Chamber of Commerce Singapore (CEEC-Singapore) is also expected to take place this year. Follow us for more news on the topic.