Aerospace & Defense Exporter Alert, Nov. 2023

Market of the Month, Republic of Singapore

The aerospace industry in Asia Pacific has made remarkable strides over the past decade and the Southeast Asia region is growing rapidly where Singapore has become an industry leader as well as the region’s aerospace hub.  It is the leader in aerospace maintenance, repair, and overhaul (MRO) services which has significant investments in research and development.  Given Singapore’s strong position in the industry, there are increased opportunities for American firms in the regional aerospace market.

Aerospace
Post COVID-19, Singapore is expected to continue growing strongly due to the significant growth levels expected within the region.  MRO services are foreseen to remain the largest segment of growth in the Singapore aerospace industry which amounted to US$10 billion in 2022.  As in previous years prior to the COVD-19 pandemic, engine overhaul is anticipated to make up the largest portion of MRO spending, generating possibly under half of the MRO market.  Activities such as line maintenance and component overhaul and repair all help the MRO market contribute easily 80% of the aerospace industry. 

In addition, rapid technological advances and digitalization are also changing the complexion of aerospace manufacturing.  New market segments including unmanned aerial systems (UAS) have emerged.  These industry trends will transform existing jobs and create new skills in areas such as data analytics, additive manufacturing design and robotics engineering.  Many global aerospace companies which are in the forefront of the industry have a long presence in Singapore.

Defense
With continued regional tensions caused by the South China Sea disputes and other geopolitics, combined with the presence of transnational terrorism, cyberattacks and maritime piracy, demand for defense equipment in Singapore is expected to increase, making Singapore’s defense market more appealing.  In particular, demand for high-tech, high-end equipment continues as the primary impetus in keeping the relatively small Singapore Armed Forces (SAF) with the best-in-class equipment.  As such, Singapore’s defense expenditure is expected to increase over the immediate years ahead, which will augur well for the local defense industry and provide greater opportunities to foreign defense suppliers in selling their wares to the SAF. 

Space
Singapore has arguably one of Southeast Asia’s most diverse space eco-systems with over 2000 jobs created in 60 companies currently in the sector.  These jobs range from design and manufacturing to data processing for satellites.  Singapore has launched 19 satellites since 2011 while ongoing partnerships with companies and research institutions aim to further develop its satellite capabilities and create new space applications and services.  The Office for Space Technology and Industry (OSTIn) at the Singapore Economic Development Board spearheads the country’s efforts in the sector and is looking at the application of international law on small satellites as well as the long-term sustainability in space.

Upcoming Events:
For companies seeking opportunities to enter the Singapore market in the areas of aircraft components & equipment, advanced air mobility, future tech / UAVs, MRO services and sustainability, there are several upcoming relevant events of interest:

• Singapore Airshow 2024: The biennial event is Asia’s largest and most influential international aerospace and defense exhibition for stakeholders to forge strategic alliances, collaborate for change to shape the future of global aviation industry. The event will take place in Singapore, February 20-25, 2024.
   
• Global Space and Technology Convention: Asia’s premier space and technology event, bringing the latest technology news, what’s hot in the satellite scene and space technology. The event will be held in Singapore, February 15-16, 2024.
   
• Rotorcraft Asia & Unmanned Systems Asia: Scheduled for May 2025, the event brings together the convergence of rotorcraft and unmanned sectors and fosters an exchange of knowledge and synergies to elevate mobility solutions in the booming Asia Pacific market.

We are in many U.S. Embassies & Consulates worldwide as well as major cities across the United States.  Contact us to learn more about how we can assist companies to increase the exports of their U.S. technologies, products and services.  
 

Contact Information

 CHAN Y K, Commercial Specialist
 U.S. Embassy – Singapore
 Email: yiukei.chan@trade.gov

Announced in September 2021, the Australia-United Kingdom-United States (AUKUS) security partnership was established under the Biden-Harris Administration to promote a free and open Indo-Pacific by deepening diplomatic, security, and defense cooperation with the United States’ closest allies. While AUKUS is motivated by enhanced deterrence and regional security, it incorporates substantial trade elements foundational to the effort. Woven into the two-pillar arrangement, AUKUS partners commit to the development and delivery of defense capabilities as well as the necessary infrastructure and industrial base investments that will create export opportunities to help realize the strategic objectives. 

Under Pillar I, the United States and the United Kingdom agree to support Australia’s acquisition of U.S. Virginia class submarines and the development of a conventionally armed, nuclear-powered submarine (SSN), coined “SSN-AUKUS”, which is a combination of British submarine design with American advanced technology. Pillar II is a suite of cooperative partner activities intended to develop and field advanced capabilities. The AUKUS agreement defines advanced capabilities to include, but not be limited to, undersea capabilities, quantum technologies, artificial intelligence, and advanced cyber, etc. 

The AUKUS partners’ industrial bases and the trade amongst them will be the implementing force behind this large-scale, generational initiative. This creates a rich environment for U.S. aerospace and defense companies to increase engagement and partnerships with British and Australian companies, and the Singapore Air Show will be a perfect opportunity to connect with these partners. As the terms of the AUKUS arrangement come together, I&A’s Office of Transportation and Machinery (OTM) will provide ongoing updates to U.S. industry partners. For more information, please reach out to OTM’s MaryLee Pollitt at MaryLee.Pollitt@trade.gov. If you are interested in those markets, please contact your local trade specialist.

On August 28, Deputy Secretary of Defense Kathleen Hicks announced the Replicator initiative which aims to field thousands of expendable autonomous systems at scale in multiple domains within the next 18-24 months. The Replicator initiative will focus on expediting production of small, smart, and cheap platforms designed to overcome the ‘production valley of death’ and counterbalance the PRC’s mass production capabilities. Replicator will use existing funds and authorities to drive production and delivery with traditional and nontraditional defense companies in the U.S. industrial base. 

From fielding capabilities to cooperation with U.S. allies and partners, Replicator expands opportunities for export and foreign military sales to ensure the program has a force multiplying effect for the warfighter. Replicator leverages the industrial bases of allies and partners that will integrate resources and build off historic security partnerships like Australia-United Kingdom-United States (AUKUS). As the Department begins to implement the Replicator initiative, I&A’s Office of Transportation and Machinery will keep companies updated for opportunities to participate in the program. Interested in getting involved? For more information, please reach out to Patrik Kjos at patrik.kjos@trade.gov. 
 

We engage with events and trade shows to accelerate the global reach of the events.  Providing participants the assurance that the U.S. Department of Commerce not only recognizes the event but is also committed to using the event to maximize opportunities for U.S. exporters.

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