Discusses key economic indicators and trade statistics, which countries are dominant in the market, the U.S. market share, the political situation if relevant, the top reasons why U.S. companies should consider exporting to this country, and other issues that affect trade, e.g., terrorism, currency devaluations, trade agreements.
Singapore is an important partner of the United States with a bilateral, gold standard Free Trade Agreement (FTA) signed in 2003 and implemented January 1, 2004 - the first U.S. FTA signed in Asia. In 2019, the city-state was the United States’ 13th largest export market importing US$31.5 billion worth of goods. The U.S. was Singapore’s second largest source of imports, while China retained its top position, followed by Malaysia, Taiwan, Japan, Indonesia, South Korea, France, United Arab Emirates and Germany. The U.S. goods trade surplus with Singapore was US$5.2 billion in 2019.
In 2019, Singapore’s real GDP grew by 0.7%. As a result of the COVID-19 pandemic, the Singapore economy is expected to contract by 5-7 percent in 2020, the worst recession since its independence in 1965. Singapore has taken decisive action in response, spending US$70 billion, almost 20 percent of GDP, on stimulus and recovery initiatives. While the immediate priority is saving and creating jobs, Singapore has also allocated significant attention and resources to long-term investments in infrastructure, upskilling its workforce, and digitalization in order to remain a global hub for business, research and innovation, trade, and finance.
Singapore held a general election on July 10, 2020, with the ruling People’s Action Party (PAP) under Prime Minister Lee Hsien Loong returning to power with a supermajority. Although the PAP’s share of the vote decreased almost 9 percent, the PAP remains firmly in control and PM Lee will lead the new government. We do not expect major shifts in Singapore’s economic and foreign policies.
The World Bank ranked Singapore the second easiest place to do business in the world and World Economic Forum rated Singapore as the world’s most competitive economy.
U.S. companies should consider exporting to Singapore for the following reasons:
• Major distribution, logistics and financial hub; as such, many consider it the gateway to the ASEAN region
• Transparency and lack of corruption
• Business-friendly laws and regulations
• Strong intellectual property protection
• English speaking population