Singapore tops global trade rankings
Singapore continues to top global rankings when it comes to enabling trade amid an uncertain period for exporters, according to a new report. The Global Enabling Trade Report 2016 found that the domestic market here is one of the world’s most open, with 99.7 per cent of goods entering duty-free, while border clearance processes are the world’s best in terms of efficiency, predictability and transparency.
The private sector ranks third for its transport services, and second for its operating environment, with especially high marks for efficiency and trust in public institutions.
But Singapore lags behind on access to foreign markets, said the World Economic Forum’s biennial report. Mr Richard Samans, a member of the World Economic Forum’s managing board, said in the report: “The year started with the signing of the Trans-Pacific Partnership (TPP), bright hopes for the Transatlantic Trade and Investment Partnership, signs of progress in the World Trade Organisation, and a positive mood among world leaders.
“By November, anti-trade rhetoric in the United States election, the United Kingdom’s vote to leave the European Union, and stark divides among World Trade Organisation members had brought progress on these fronts close to a halt.”
The TPP’s fate is uncertain after US president-elect Donald Trump called it a “potential disaster” for his country, vowing to pull out of it.
Mr Samans noted that “less globalisation or less open borders” are not the solutions.”What the world needs instead is a more inclusive globalisation to help those made worse off by it. This implies better redistribution policies and social safety nets, active labour market policies, and new industrial policies.”
CALL FOR MORE REDISTRIBUTION
What the world needs instead is a more inclusive globalisation to help those made worse off by it.
MR RICHARD SAMANS, a member of the World Economic Forum’s managing board, on moving forward in these unsure times.
On the upside, trade liberalisation has continued in regions like Asia and Africa. “Amid the uncertainty, business and governments are looking for signs to show them which aspects of trade policy and practice are working well, and which aren’t,” said Mr Samans.
CIMB economist Song Seng Wun noted: “Singapore has a long list of free trade deals signed, and others waiting to be signed. If TPP dies, we may have to resume negotiations with Canada and Mexico.”
Open trade has also benefited Asean, which now rates higher for domestic and foreign market access compared with the EU and the US, the report said.
Mr Samans said: “Asean members have become more open while enjoying better foreign access, as a result of the region’s steady integration, and a number of trade and investment agreements with its main partners.” Mr Song noted: “The region’s growth opportunities are created as tariff barriers are lowered.”
Advanced economies like Singapore’s typically enjoy lower trade costs, not just due to low tariffs, but because economic development leads to better administration, infrastructure, telecommunications and regulation, the report said.