SINGAPORE - Singapore is actively partnering like-minded countries and organisations on digital trade efforts, in order to stay nimble in its international trade strategy, said Minister-in-charge of Trade Relations S. Iswaran.
In his opening remarks at the Free Trade Agreement (FTA) Symposium on Wednesday (Oct 23), he said Singapore's global network of over 24 FTAs with 36 trading partners is a testament to its commitment to an open, connected and globalised world.
The symposium was organised by the Ministry of Trade and Industry (MTI), Enterprise Singapore (ESG) and Singapore Business Federation (SBF) to commemorate 20 years of the nation's FTA strategy.
At more than three times Singapore's gross domestic product, trade is the country's lifeblood, and the Republic regards the world as its hinterland, said the minister.
"These FTAs have gained our businesses access to millions of consumers in markets across the globe, preferential access to services sectors, expanded government procurement opportunities, and improved intellectual property protections," he said. "They also provide legal certainty and help to safeguard the interests of Singapore businesses in overseas markets."
A study conducted by the MTI estimates that, on average, Singapore businesses' exports of goods to a trade agreement partner increases by about 18 per cent two years after the agreement's entry into force, and a further 16 per cent in the third year.
In 2016, FTAs collectively saved businesses about $720 million in tariffs, an increase from $450 million 10 years ago.
But current trade rules and policies do not address the needs of the digital economy enough, said Mr Iswaran, who is also Minister for Communications and Information.
Speaking to business and government leaders at the Shangri-La Hotel, he said this is why the Republic seeks to shape a new digital trade architecture - in the same pioneering spirit as when the Republic embarked on its first FTA 20 years ago, when the trade orthodoxy, now debunked, was that bilateral agreements were discriminatory.
Singapore has embarked on Digital Economy Agreements with like-minded countries like Australia, Chile and New Zealand, and negotiations are progressing well, said the minister. The agreements will put in place clear and harmonised international rules, and guard against digital and data barriers.
They will also address emerging areas such as artificial intelligence (AI) and digital identities, he added.
These efforts also extend to the World Trade Organisation (WTO), where Singapore, together with Australia and Japan, are negotiating e-commerce and digital trade rules.
"We were clear then, as we are now, that our pursuit of FTAs can and should complement and not supplant multilateralism. Bilateral and plurilateral FTAs are a practical way for like-minded parties to work towards a more ambitious level of trade liberalisation," he said.
This is because multilateral negotiations are constrained by the large number of members and wide range of interests, making it tempting for them to converge on the lowest common denominator.
But Singapore cannot rely on trade strategy alone to progress, said Mr Iswaran.
While free and open trade fosters economic growth, it does not always generate equitable outcomes. This is why Singapore invests in training and re-training its workers, and helps businesses transform and adapt to the digital age, he said.
"Where necessary, we make government transfers to ensure we share the benefits across society and uplift the most vulnerable. These measures help to ensure that the benefits of free trade are equitably distributed, and that we progress as one cohesive society."