Exporting to Singapore

This island neighbour has only four million people, but with purchasing power that equals or exceeds that of the leading nations of Western Europe and a tradition of barrier-free trade, there are plenty of good reasons to explore this market.

When the Singapore-Australia Free Trade Agreement (SAFTA) was signed in 2003, many Australians wondered why we bothered. This tiny island, just one-twentieth the size of greater Sydney, has long been known (like Hong Kong) as a duty-free port, so what were we going to gain? 

The answer is plenty, and officials in Canberra were not the only ones to recognise the potential for enhancing business opportunities through a bilateral agreement. Over the past few years, little Singapore has minted similar agreements with the United States, Japan, Korea, India, New Zealand, Chile, Jordan, Panama and the four European countries making up EFTA (the European Free Trade Association, comprised of Norway, Switzerland, Iceland and Liechtenstein). Added to this impressive collection is Singapore's membership in the Association of South-East Asian Nations (ASEAN) and the ASEAN-wide trade agreement with China.

Singapore may be small geographically but economically it thinks and acts big. Measured on a purchasing power parity basis, the average Singaporean has a purchasing power equivalent to the average Aussie and the Singaporean market is a sophisticated one where consumers tend to be more concerned with high quality than with price. With a legal system based on English common law, English as the language of administration and business, and a long history of friendly relations with Australia, the country is a welcoming place for Australians to do business. It's also close by and extremely well connected.

Trade Hub

In 2006, Singapore's 4.4 million people managed to find a way to use 4.8 million mobile phones in service that year! It has a highly developed free market economy that has always depended on international trade and taken advantage of its good location to become a major trans-shipment hub. Exports of consumer electronics and information technology products are particularly important for Singapore (major Australian imports from the country include computers and telecommunications equipment), but the government worries about over-dependence on these sectors and has recently attracted major investments in medical technologies and pharmaceuticals. Other significant local industries in the country include chemicals, financial services, oil drilling equipment, petroleum refining, rubber processing and rubber products, ship repair and offshore platform construction. A near total absence of domestic production makes the country dependent on imports of food and many Australian purveyors of quality meat, fish, vegetable and dairy products have found attractive markets in Singapore. Several years ago, Food Adelaide ran a highly successful promotional trade mission to the country and a number SMEs were able to establish profitable export relationships with Singaporean retailers and upscale hotel and restaurant buyers.

Overall, Singapore is Australia's ninth most important destination for industrial and agricultural goods and an important export market (about $3 billion annually) for our services providers as well. Trade facilitation measures—many of which were significantly enhanced through SAFTA—make it easy to deal with customs and border formalities. Using electronic paperless trading techniques, goods are typically cleared through Singapore Customs before they arrive in port.