Mr Desmond Choo: To ask the Minister for Trade and Industry with the enhancement of the China-Singapore Free Trade Agreement (a) what is the projected increase in the volume and type of trade between the two countries; (b) how is the Ministry helping Singapore companies to leverage on the new opportunities in China; and (c) which are the industries that will be of interest to Singapore companies looking to expand into Central and Western China.
1. The CSFTA upgrade completed this month comprises a meaningful package. It is substantive in terms of market access for Singapore’s export of goods and services into China, as well as enhancing the rules and investment regime for our companies doing business in China.
2. Since the entry into force of the CSFTA in January 2009, bilateral trade with China has grown from close to S$76 billion in 2009 to S$137 billion in 2017. Our investments in China have also doubled from S$62 billion in 2009 to S$123 billion at end-2016. The upgraded CSFTA will promote greater bilateral trade and investment flows between China and Singapore.
3. For example, the improved rules of origin will allow more petrochemical and plastics exports from Singapore to qualify for tariff savings. Singapore companies in the legal, construction and maritime service industries will be able to expand their footprint and no longer be subject to ownership caps in various parts of China. Singapore investors investing in China can also look forward to enhanced investment protection through a more robust Investor-State Dispute Settlement (ISDS) mechanism. The upgraded CSFTA also includes rules in new areas such as E-Commerce, Competition and Environment to keep abreast with new business developments.
4. At the regional level, Central and Western China present opportunities for Singapore businesses. There is significant demand arising from urbanisation and the growth of the middle class. The Chinese government has also placed emphasis on policies to develop industries such as infrastructure, urban planning, and transport and logistics, areas where Singapore companies have significant strength and interest. Notably, the China-Singapore Connectivity Initiative (CCI)’s New International Land-Sea Trade Corridor is an important, complementary economic route, connecting Western China and Southeast Asia. Together with the upgraded CSFTA, companies can leverage on increased connectivity to access opportunities in Central and Western China.
MTI and Enterprise Singapore will continue to work with Trade Associations and Chambers (TACs) and reach out to Singapore businesses to help them utilise the upgraded CSFTA.