OCBC signs pact with UK govt to channel $17b of investments into key British industries
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OCBC said the commitment was sealed on April 2 between the bank and the UK’s Office for Investment in London.
PHOTO: LIANHE ZAOBAO
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SINGAPORE - Singapore bank OCBC has signed an agreement with the government of Britain to channel $17 billion of foreign investments into British energy, infrastructure and real estate by 2030.
OCBC said the commitment was sealed on April 2 between the bank and the UK’s Office for Investment (OFI) in London.
Britain’s Minister of State for Investment Poppy Gustafsson signed the pact with OCBC’s head of global corporate banking Elaine Lam.
“This is the first such strategic partnership agreement between OFI and a Singapore bank, and the largest inward investment that OFI has established with an Asian bank,” OCBC said in a statement.
The bank said the agreement seeks to promote the UK as a hub for businesses, investors and services involved in and leading the energy transition.
OCBC will also support UK businesses expanding into or establishing operations in Singapore and South-east Asia.
“This builds on the UK’s entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) free trade agreement last year,” OCBC said, adding that UK companies will enjoy greater access to CPTPP markets, and there will potentially be more trade flows into South-east Asia from the UK.
To achieve these goals, OCBC and OFI will work together on initiatives to foster knowledge-sharing and facilitate relationships between OCBC and UK businesses, institutions or agencies.
Ms Lam said OCBC’s UK business has grown significantly over the years, driven by developments in sectors such as real estate, renewables and energy transition, as well as digital and core physical infrastructure.
“These align with the priority sectors outlined in the UK’s industrial strategy, and we will double down on our efforts to drive further growth in these areas,” she said.
Ms Lam gave the example of Virtus Data Centres, a leading data centre company in the UK, majority-owned by Singapore-headquartered ST Telemedia Global Data Centres.
She said that with OCBC’s support, Virtus has established 17 data centres across four campuses in the Greater London area.
Britain’s Minister of State for Investment Poppy Gustafsson (left) signed the pact with OCBC’s head of global corporate banking Elaine Lam.
PHOTO: DEPARTMENT FOR BUSINESS AND TRADE OF THE UK
Ms Gustafsson said the partnership with OCBC will not only help create more opportunities in real estate and infrastructure, but will also back the UK’s clean energy industry, a key growth sector identified in the upcoming industrial strategy of the country.
“There’s loads of really interesting projects happening around things like carbon capture, and they are really aligned with OCBC’s big infrastructure investment thesis,” she said in a virtual interview with The Straits Times.
“This is going to be an ongoing, iterative relationship where we work together to support investment in some of those key areas,” she added.
Talking in the context of rising global uncertainty around trade and investment policies, Ms Gustafsson said: “Companies are looking for clear alignment of policies and direction. So they want to know if they are making a long-term investment that is aligned with what the UK is trying to accomplish.”
She said her role as investment minister is to clearly articulate what the UK’s priorities are, what it is trying to accomplish, and what the regulatory environment will look like.
“Those are really important because what it is saying to investors is we care about these sectors, we have big ambitions, and we would welcome and encourage partnership with the private sector.”
She said Britain will also remain calm and pragmatic in the face of growing protectionism.
“We should not be in a position where we are making emotional knee-jerk decisions. And I think being calm and rational and seeing the world as it is and not what we hope it to be or not what we fear it to be is a really important aspect of navigating this, and the reality is that we are in uncertain times, and we don’t necessarily know what the tariffs will look like, what the consequences of the tariffs will be, or how countries will respond or retaliate.”
In a separate statement, Britain’s High Commissioner to Singapore Nikesh Mehta said: “OCBC’s commitment demonstrates the confidence that Singapore’s financial institutions have in the UK economy, and how our financial centres can partner to drive mutual prosperity.”
Mr Martin Kent, Britain’s trade commissioner for Asia-Pacific, said the partnership with OCBC will create more opportunities for Asia-Pacific businesses looking to invest in the UK.
“Investors already see the UK as a world-class destination for investment, with total foreign direct investment stock over £2 trillion (S$3.5 trillion) in 2023. We are determined to make it quicker, easier, and more profitable to do business with the UK,” he said.
The UK and Asia-Pacific trading relationship is worth £125.7 billion, with UK-Singapore trade making up £22 billion of that.
In 2023, the UK’s direct investments in Singapore totalled £15.7 billion. Singapore invested £19.3 billion in the UK in the same year.
The UK and Singapore have a free trade agreement that came into force in February 2021
