Singapore, a nation of merely around 5 million population, invested US$5.657 billion to China in 2010, according to statistics from Ministry of Commerce of P.R.C. It is currently the third largest foreign investor in China, behind Kong Hong SAR and Chinese Taiwan. According to China Customs, the total trade value of import and export between China and Singapore reached US$57.06 billion in the year of 2010, an increase of 19.2% year on year. Among them, China’s export to Singapore accounted for US$32.35 billion, 7.6% growth upon the last year, and the import value amounted to US$24.71 billion, 38.8% increase compared with 2009. Based on the closer economic exchange and cooperation between the two countries, China’s Foreign Trade conducted a special interview with H.E. Mr. Chin Siat Yoon, Ambassador of Singapore to China.
Q: If you have three words to describe the mutual trade relationship between China and Singapore, which words would you choose and why?
A: Off hand, I would say Broadbased, Growing and Win-Win. Singapore and China enjoy strong, expansive trade relations. In 2009, China was Singapore’s 3rd largest trading partner, after the EU and Malaysia, while Singapore was China’s 8th larg- est trading partner. Two-way trade picked up in the fi rst half of 2010. Total trade stood at SGD 46.6 billion in the fi rst half, an increase of about 37% from the same period in 2009. Both imports and exports rose, benefi ting both sides.
Q: According to China Customs, China now has become the largest trade partner and the biggest export destination of ASEAN. From the open of China-ASEAN FTA at the beginning of 2010, what changes have been taken place in mutual trade?
A: In 2009, China became ASEAN’s largest trading partner accounting for 11.6 percent of ASEAN’s total trade while ASEAN rose to be China’s 4th largest trad- ing partner accounting for 9.7 percent of China’s total trade. Also, despite the global crisis, ASEAN remains an attractive foreign investment destination for Chinese investors. FDI fl ow from China to ASEAN increased by 8.6 percent, according to Chinese statistics, compared to a decline of 37 percent at the height of the global downturn.
I am sure that the full realisation of the ASEAN-China FTA in 1 January 2010 has helped, and will continue to help, to further enhance this trade relationship.
Q: According to Ministry of Commerce of China, Singapore ranks the top three in terms of investment in China in 2010. Which industries does the investment mainly go to?
A: According to the statistic from Singapore side, the cumulative investmens in China from Singapore at the end of 2009 is S$54.3 billion. T e investments span a wide spectrum of industries, ranging from manufacturing, property development, transport and logistics and environmental engineering, to banking and fi -nance, healthcare and education. In recent years, we have also noticed a rising trend in Singapore’s investments in sectors relevant to China’s needs as a rapidly developing economy with fast rate of urbanization, such as urban solutions and modern services.
Geographically, Singapore’s investments have diversifi ed their presence from the coastal regions to inland regions such as Western China, Central China and the Northeast.
In urban solutions, Singapore companies see opportunities for cooperation in areas such as water and environmental management, as well as urban planning and township development. Many Singapore companies have strengths in these areas and look forward to partnering their Chinese counterparts for win-win partnerships.
In modern services, Singapore service providers in sectors such as ICT, logistics, fi nance, education and healthcare are seizing opportunities presented by many cities’economic restructuring initiatives. As China’s economy becomes more developed and the emphasis shifts towards tertiary industries, Singapore companies hope to share their expertise and experience in these sectors with Chinese businesses and consumers.
Q: Can you introduce to us the current situation of Singapore enterprises in China? What challenges and opportunities have they met in China?
A: Singapore companies are known for their expertise in manufacturing, trading,
real estate, industrial park planning and development, port and logistics, infrastructure services, urban planning and management etc. In recent years, the cooperation and investments have been gradually moving towards the services industries, including environmental services, urban planning, education services, vocational and technical education, infocom technology, food services, retail, and fi nancial services.
In investing in China, our companies try to stay in tune with China’s economic development strategies. We fi nd that this is a good way to seek out opportunities. For instance, many provinces are restructuring their economies, focusing more eff orts in services. T is is an area in which Singapore companies excel. Singapore has gone through similar phases of economic restructuring in the past and our companies have gained experience in applying, integrating and managing specific solutions to meet a city’s needs. With natural limitations such as scarcity of land and water resources, Singapore has had to manage our development in an effi cient, sustainable and responsible manner.
Opportunities: Singapore companies can work with China for win-win partnerships in these key areas:
First, partnering Chinese enterprises for internationalisation.
Chinese enterprises, including the POEs, are growing very strongly. Many are looking beyond the shores of China. By partnering Singapore companies, the Chinese enterprises can tap on our well established global networks and, of course, the well developed infrastructure in Singapore, to expand not just in Southeast Asia but also other growing markets like India and the Middle East. Due to Singapore’s strategic location in the heart of Asia and the open business environment, our companies have developed close ties with many markets near and far. T is enables both Chinese and Singapore enterprises to ride on each other’s strengths and resources to grow together.
Second, exporting our services.
China’s cities and provinces are at diff erent stages of development with correspondingly different needs. As they look to move up the manufacturing value chain and upgrade their economic structures, Singapore can share its development experience in relevant areas like education, vocational and technical education, e-Government services, and environmental services.
Challenges: Challenges are a natural part of doing business overseas. For expansion into any market, companies must first familiarise themselves with the local market conditions. In the Chinese market, apart from the usual man- power and legal issues, language, culture and business culture can be a challenge.
Q: How is the investment situation from China to Singapore? Which fields are most welcomed for foreign investment in Singapore? For those Chinese enterprises who wish to invest in Singapore, what recommendation will you give?
A: Singapore welcomes PRC enterprises looking at internationalising their operations to use Singapore as a base from which to expand and extend their reach.
More than 4,000 Chinese companies have already established their presence in Singapore. Out of these, some 155 companies have listed on the Singapore Stock Exchange. There is room for many more.
Many of the Chinese companies with presence in Singapore, such as Li Ning, Hai’er, Huawei and AAC Acoustic, are leaders in their own fi elds domestically. Their operations in Singapore usually serve as the companies’regional HQ , leveraging on Singapore’s extensive connectivity with other economies, competent labour force and effi cient capital markets.
Q: Singapore is reputable for its beautiful view. How is the cooperation between Singapore and China in tourism? Can you illustrate some figures to explain? Where are some of the “must visit”
places in your eyes?
A: In 2009, 937,000 Chinese visitors came to Singapore, which makes China the second largest market in terms of visitor arrivals. Our latest statistics also show that visitor arrivals from China have continued to increase.
2010 was a landmark year as Singapore unveiled a transformed landscape showcasing the vibrancy of our city as a lifestyle destination. T e opening of the two Integrated Resorts i.e. Marina Bay Sands and Resorts World Sentosa has helped boost Singapore’s attractiveness as a destination, broadening our leisure and entertainment options. Other “must-visit” places in Singapore include the Singapore Flyer as well as Orchard Road, our premier shopping street which has been recently revitalised to expand retail, dining and entertainment options.
We have also developed a strong lineup of signature events. In 2008, Singapore made history by hosting the fi rst Formula One night race. There is a whole new lifestyle season around the race. Grand Prix Season Singapore is packed with an exciting line-up of quality lifestyle and entertainments events. T e Singapore Sun Festival showcases an exclusive programme of internationally acclaimed experts in the fi elds of music, fi lm, literature, art, cuisine, wine and wellness, to celebrate the “Art of Living Well”.
Future tourism developments include the International Cruise Terminal scheduled for completion in late 2011 -which aims to position Singapore as the cruise hub of the region. T e River Safari, a 12-hectare third animal-themed attraction to be located next to the Singapore Zoo and Night Safari, is set to open in 2012. It will take visitors on an up-close and multi-sensorial journey to the realm of the largest collection of freshwater fl ora and fauna in Asia.
Q: As a member country in Asean, what strategic role does Singapore play in promoting a closer relationship between China
and Asean?
A: It is in our interest that ASEAN and China enjoy good, flourish- ing relations. We do what we can to promote these relations. While we cannot play a leadership role, we can and do contribute ideas. Our strategic location at the heart of Asia, as well as our language- and culture-friendly environment, makes us a natural hub and springboard from which China can access Asean and vice versa.