WASHINGTON - It might come as a surprise to many but Singapore is a major investor in the US, with investments from banking to agriculture and telecoms. Singapore has made US$73 billion (S$99.6 billion) in investments cumulatively across more than two dozen US states, making it the second-largest Asian investor in the US after Japan.
"Did you know that Singapore is the second-largest Asian investor in the US?" Prime Minister Lee Hsien Loong said on his Facebook page last week, posting a picture of a map of Singapore's investments in the US produced by International Enterprise (IE) Singapore.
Successful Singaporean investments run the gamut from technology, retail, banking, hospitality, logistics, and F&B, he wrote. "Our trade and economic ties with the US will continue to grow, with both economies set to benefit," he said.
According to figures released by the US Department of Commerce in September, Singapore is one of the fastest-growing sources of foreign direct investments (FDI) in the US in recent years, Singapore's The Business Times reported.
From 2011 to 2016, investments by Singapore companies in the US increased at a compound annual growth rate of 36.9 per cent, behind only Thailand (55.5 per cent), Argentina (46.4 per cent) and China (44.7 per cent).
"Compared to five years ago, we see much more interest in the US," New York-based Natalie Choo, IE Singapore's group director for North America & Europe, told The Straits Times. "While investment in traditional sectors such as manufacturing and real estate continue, we also see increased interest from our small and medium-sized (SME) companies especially in the consumer and technology sectors," she added.
A significant proportion of Singapore's interests are on the east and west coasts. But companies like Singapore-based AC Global Energy (ACGE) are helping to extend the Republic's footprint across the US.
A drop in local demand for paper, triggering a surplus of pulp wood, presented an opportunity for ACGE to set up a 7.5 million gallon-a-year biodiesel plant in Tennessee, to convert the pulp into fuel. Production started in September 2017.
The plant also makes biochar - a soil enhancing additive - and wood-based vinegar pesticide. The company has invested more than US$40 million in the Tennessee project and will commit another US$40 million to a second plant in Alabama.
"It's an exciting story to us because it's a relatively new space for Singapore companies to play in," said Ms Choo, noting that the US is a leading hub for technology and innovation, and "home to four of the top five start-up ecosystems in the world".
She said: "The vibrancy, breadth and depth of the tech ecosystem and the presence of the world's largest and fastest growing tech giants make it a natural magnet for international tech companies, including our home-grown start-ups. "Singapore companies of all sizes across industries are plugging into these ecosystems and scaling through co-creation and partnerships with US tech companies."
Mr Calvin Lim, chief executive officer of ACGE, noted that its Tennessee plant is located near Oak Ridge National Laboratory. "There is a lot of talent in terms of engineering, so finding the right people with good skills sets is easy considering within one square mile you have the highest number of PhDs anywhere in the world," he told ST.
Singapore is also the US' largest trading partner in Asean. Underpinned by a US-Singapore Free Trade Agreement in 2003, the US had a trade surplus of over US$18 billion with Singapore last year.
Together, Singapore's investments and the US' exports to Singapore support over 250,000 American jobs, said IE Singapore, citing the US Department of Commerce.
"In an inoffensive and unassuming way, this shows that we are relevant," said Mr Phua Chao Rong, Charles, a National University of Singapore Lee Kong Chian Scholar. "Singapore's good offices, hard work and enterprising people have brought benefits to the US as well," he told ST.