Singapore: The global trading hub
The Republic of Singapore – an island city-state off southern Malaysia is one of the smallest nations in the globe with a multicultural population of 5.6 milion people, yet it consistently ranks high for the most competitive economy in the world and is known to be Asia’s most dynamic and innovative country.
Singapore has a land area of 719 km2, which is slightly smaller in size from our well appreciated island Hiiumaa with its land area of 989m2. In just over 50 years, Singapore became from a newly independent nation with no natural resources and limited capital to one of the world’s easiest and freest places to do business. Singaporeans have long understood, that in order to stay relevant and competitive in the world, one needs to have a global mindset to catalyse growth, pursuit greater connectivity and cooperation, as well as think smart, be adaptable, pragmatic and agile.
Embracing diversity is nothing new to Singaporeans and it can be argued that it is at the heart of the Singapore DNA. Singaporeans do believe that diversity is fundamental in order to be competitive in the global marketplace, as diversity has been proven to drive creativity, and creativity leads to innovation. In a speech, Prime Minister Lee Hsien Loong said that Singapore is not a melting pot, but a society where each race is encouraged to preserve its unique culture and traditions, and appreciate and respect that of others.
According to Economist Intelligence Unit, Singapore ranked as the world’s most expensive city for a fourth straight year. Nevertheless, Singapore continues to attract a large amount of foreign investment as a result of its location, skilled workforce, low tax rates, advanced infrastucture and zero-tolerance against corruption. There are more than 7,000 multinational corporations from the United States, Japan, and Europe, while there are approximately 1,500 companies from China and India. Despite its market freedom, Singapore’s government operations have a significant stake in the economy which contributes to 22% of the GDP.
Few Facts 2018:
- GDP: US$292.8 BILLION
- Total Trade: US$614.0 BILLION
- EU-SG Trade of Goods in 2017:
- EU imports from SG: Euro 20 billion
- EU exports to SG: Euro 33 billion
- TOP FIVE TRADING PARTNERS: CHINA, MALAYSIA, EU, USA, INDONESIA
- Unemployment rate: 2.0%
- 44% of the Singaporean workforce are made up of foreign nationals
- Buddhism is the most widely practised religion in Singapore (33% of residents)
- SG is one of the greenest cities in the world
By 2020, Asia is expected to account for 60% of global trade flows, shifting the focus away from Europe and North America. Strategically located at the heart of Asia, Singapore is in the middle of key trade flows from Europe, the United States, the Middle East, Australia and Asia – cementing its position as a global trading hub as 30% of Asia’s trade passes through Singapore. The economy is diversified, with its top contributors—financial services, manufacturing, oil-refining. Singapore’s largest industry by far is the manufacturing sector, which contributes 20%-25% of the country’s annual GDP. Manufacturing key industry clusters include electronics, chemicals, biomedical sciences, logistics and transport engineering. Meanwhile, new emerging sectors include automotive, robotics, environment and water, and natural resources.
Singapore is a leading aviation hub in Asia-Pacific, supported by over 100 aerospace companies. On the other hand, tourism forms a large part of the economy, with over 17 million tourists visiting the city-state in 2017. The city-state also promotes itself as a medical tourism hub: about 200,000 foreigners seek medical care in the country each year. Singapore medical services aim to serve at least one million foreign patients annually and generate USD 3 billion in revenue.
In 2014, Singapore government acknowledged the need for digital infrastructure and established an initiative called SMART NATION to synergise efforts and empower Singaporeans. The aim is to transform Singapore through digital technologies and innovation to create tech-enabled solutions. The government is leaning forward to catalyse growth and innovation across all domains, including the public sector. Crucially, these efforts are underpinned by efforts to ensure that all segments of society are able to harness digital technologies and benefit from them with the aim of improving the lives of citizens, creating more opportunities, and building stronger communities. Innovation has been at the root of the country’s development — both for liveability and sustainability. Singapore’s tech budget for 2017 was stated as one of its highest, at $2.4 billion SGD. At present, the Singaporean government has decided to support technology startups by doing business, instead of grants to spur innovation.
Technology is a double-edged sword. Whoever is able to cope with rapid technological changes and seize the opportunities it brings, emerges the winner. Singapore is forging the city-state of the future, planning to become the SMARTEST CITY worldwide!
Estonian Companies in Singapore
Singapore is a great platform for everything innovative, in effect a few diligent Estonian tech-startup companies have seized the opportunity and established their businesses here: BOLEFLOOR, JOBBATICAL, SMARTLY, TRANSFERWISE and recently Funderbeam, just to name a few. The edutech company Clanbeat with its founder Kadri Tuisk, is eagerly entering the local education industry, tapping into public and international schools with its HR management software.
The Estonian indoor herb garden Click & Grow has successfully entered COURTS, a local consumer electronics and furniture retailer with a network of 80 stores, while BonBon lingerie entered Singapore market in the beginning of 2018.
In December, EAS is co-organising Nordic Christmas Market in Singapore. The event offers a great opportunity for Estonian artisanal food/beverage and lifestyle companies to promote their products and connect with local distributors, influencers and agents to establish new business relations. The event’s organiser, Mr. Beng Tong Neo of the Next Twenty company, strongly believes that Estonian artisanal products have a potential in the Southeast Asian market. EAS will support the Estonian companies and the interest has been surprisingly high, among the participants are ArtisanHoney, Siidrikoda, Distillirium, Alpaka, AndreFarm, Tanel Veenre Jewellry, Lisa Kroeber Jewellry, Castelbird & Rose. We are excited and looking forward to a sucessful Estonian Christmas in Singapore.