This Sunday, August 9, marks the 50th anniversary of independence for Singapore. The island city-state is celebrating the occasion with an elaborate series of events under the tag SG50. Singapore became independent in 1965 after a short-lived merger with Malaysia, having previously been a British possession. The British Empire left Singapore with English as the language of business, education, government, and media, along with an efficient legal system based on English common law.
Over the past half-century, Singapore has been one of the world’s great economic success stories. Its GDP at purchasing-power parity (PPP) passed that of the United States in 2004 and stood well over $80,000 in 2014. (Nominal GDP per capita is lower due to exchange rate effects.) The World Bank ranks Singapore number one in the world in its Ease of Doing Business rankings. The city-state boasts a bustling container port, an efficient airport and extensive refinery and petrochemical complex.
Although its government has been accused of authoritarian tendencies — the ruling People’s Action Party has never lost an election, and opposition voices have faced heavy-handed legal challenges in the past — Singaporean officials are famously free of corruption.
Singapore is a major regional hub for commerce, finance, shipping, and travel. The modern city was founded in 1819 as a trading post of the British East India Company, and it remains true to its free port traditions today. Its container port is the second-busiest in the world, and its trade-to-GDP ratio is the world’s highest at over 400%. Some two-thirds of imports are re-exported to third countries in the region, and there is an extensive system of Free Trade Zones to facilitate re-export and transshipment.
The U.S. Singapore Free Trade Agreement came into effect in 2004. Singapore was the 13th-leading export destination for U.S. goods in 2014. Its business culture is dynamic and firms are aggressive in pursuing new opportunities. Many distributors already have extensive experience representing American suppliers not only in Singapore itself but across broader regional markets.
In many ways Singapore offers the best of both worlds for American exporters — ready access to the rapidly growing emerging markets of Asia, in a business-friendly, English-speaking environment with an efficient and familiar legal system, strong intellectual property protections, and virtually no official corruption.
With its business-friendly culture, Singapore is generally welcoming to both visitors and long-term residents from developed countries. (That said, it is a densely populated island nation with limited land and resources, and popular resistance to immigration has grown in recent years.) Michael Jahn, an American citizen and longtime Singapore resident, notes that business opportunities there are “definitely not just for big companies in Singapore. The Singaporean government invests in whole industries at a time, and small companies can get grants or other help.” The country’s close trade relations with other nations in the region are paralleled by travel opportunities, and Jahn has relished the chance to visit Malaysia, Vietnam, Cambodia, Thailand, Indonesia, Myanmar, Sri Lanka, China, and Japan wile living there.
The U.S. & Foreign Commercial Service, an agency of the Department of Commerce, has identified the following leading opportunities for U.S. exports to Singapore:
- Aircraft and parts
- Medical devices
- Computer hardware, software & peripherals
- Laboratory & scientific instruments
- Environment control equipment
- Oil & gas
- Telecommunications equipment
- Fresh and processed fruit & vegetables and juices
- Currency: Singapore dollar (SGD, $)
- Population: 5.4 million
- GDP (2014): $308.1 billion
- Forecast GDP growth (2015): 3.2%
- World Bank Doing Business ranking: 1st of 189
- Imports from U.S. (2013): $42 billion
The Singapore exception, The Economist Special Report, July 18th 2015
Doing Business in Singapore: 2014 Country Commercial Guide for U.S. Companies, U.S. Commercial Service publication