Question
Mr Gan Thiam Poh: To ask the Minister for Trade and Industry which free trade agreement that Singapore has entered into has (i) achieved the most trade benefits so far and (ii) minimised imported cost and inflationary pressures more ably and effectively.
Written Answer by Minister for Trade and Industry Gan Kim Yong
1. Singapore currently has a network of 27 Free Trade Agreements (FTAs). They have helped our companies access global markets by lowering tariff and non-tariff barriers for Singapore’s goods, reducing restrictions for our services sectors and enhancing protection for investments.
2. It is not meaningful to compare FTAs in terms of which agreement delivered the most benefits as the extent and type of trade we have with each trading partner are unique and different. Moreover, the FTAs do not have the same coverage and are also entered into at different times.
3. When new trade partners join our FTA network, the value of our existing FTAs increases as the benefits will apply to a larger market. Singapore’s attractiveness as a trade and investment hub will also be enhanced.
4. From 2016 to 2021, our total tariff savings from FTAs almost doubled from S$700 million to S$1.3 billion. Over the same period, domestic exports to our FTA partners grew by 26%, from S$190 billion to S$239 billion. From 2016 to 2020, our stock of direct investments in our FTA partners also increased by about 26% from S$611 billion to S$772 billion.
5. In addition to tariff savings, improved efficiency from trade facilitation through FTAs has helped reduce business costs and import costs for goods and services exported from and imported into Singapore. Apart from FTAs, we are continuing to diversify the sources of our daily necessities through trade with our FTA partners. Maintaining a strong Singapore dollar is also helping to dampen imported inflation. In addition, the Government has rolled out a series of support packages and measures to help households and businesses cope with higher prices during this challenging period, with more support for those with greater needs.