THE very real possibility that Britain could leave the European Union gave a panel discussion here an extra edge yesterday.
The risks - and potential rewards - of such a dramatic event were laid out for about 70 participants, comprising local and foreign government officials, academics and business people.
A month ago, such a discussion would have been more theoretical, but a "Brexit", as the British exit is termed, is now high on the agenda following the Conservative Party's win in the May 7 elections.
The party has promised a referendum on the issue by 2017, but possibly as early as next year.
The impact on businesses here was the key topic at the seminar, jointly organised by Singapore Business Federation and EU Centre in Singapore.
Dr Michael Pulch, the EU Ambassador to Singapore, noted that even in the interim discussions of a Brexit, there will be great uncertainty, which will "dampen the mood for long-term investors", and some sectors may even experience stagnation.
And while polls have noted that many Britons do not support a Brexit, panellist Tim Oliver from the London School of Economics said the British elections highlighted the inaccuracy of such surveys.
Nevertheless, the impact of a Brexit on Singapore businesses will be minimal in the short run, said Professor Reuben Wong, director of studies at the College of Alice and Peter Tan at the National University of Singapore.
He told the event at Keppel Towers that Singapore firms are "overwhelmingly invested in the United Kingdom, and not so much in the EU", noting that around 75 per cent of Singapore's investment within the EU is directed towards Britain.
While some firms, such as Japanese production companies, base their operations in Britain to use it as a "springboard into Europe", that is not the case for Singapore firms, he added.
Such firms are usually in the goods industry and they can exploit the free trade flow within the EU but this does not apply to the service industry, to which most Singapore firms in Britain belong.
A Brexit will free up Britain to restructure its labour market, delivering greater flexibility to Singapore firms keen on doing business there, Prof Wong said.
Panellist Shivaji Das, senior vice-president at consulting firm Frost & Sullivan, noted that in the long run, the Brexit discussion might "set interesting directions for the development of the Asian Economic Community".
Moreover, if Britain loses various free trade agreements within the EU, it might look towards Singapore to foster future trade deals.
Singapore is emerging as an important base for British companies to enter Asean, he added.