Latest Post

Singapore trailing China, wooing Africa



As China continues to dig deep into Africa’s trade and investment, Singapore, another Asian country, has started wooing companies in Africa.
 
Singapore, an island city-state off southern Malaysia and a global financial centre, has asked African companies to sign in to access the rest of Asia.
 
In continuation of its recent sensitisation drive, more than 500 participants attended the Africa-Singapore Business Forum 2018 held in August shortly before the Forum on China-Africa Cooperation (FOCAC) which attracted more than 50 African leaders.
 
The Forum on China-African Cooperation held early September pegged on Chinese leader’s proposed initiative of building the Silk Road Economic Belt with a view to integrating the development strategies of partnering countries.
 
But the Singapore’s Trade and Industry Minister Chan Chun opened the conference which he said outlined the importance of promoting economic integration and cooperation against a backdrop of rising trade tensions and protectionism.
 
"I would like to encourage African businesses to engage Singapore as your partner in Asia, see Singapore not just for our domestic market, but see us also as a platform, as a launch pad for your business opportunities in Southeast Asia and beyond,” said Mr Chan.
 
``Singapore's “strong connections at the government and business levels make it a good base from which African companies can explore and access Asia."
 
According to Singstat, foreign direct investment from Africa into Singapore amounted to S$27.4 billion in 2016.
 
Over 60 Singaporean firms operate in Africa, ranging from food manufacturing to digital payment services, and Enterprise Singapore - the government agency which helps businesses internationalise - is working to increase that number. It said a main challenge was managing risk.
 
Global Markets Director, Middle East & Africa of Enterprise Singapore G Jayakrishnan said the agency works with people on the ground, validate African counterparties, as well as encourage companies to take up political risk insurance.
 
“We have programmes for (that), there are ways to mitigate it, and get around the risk element of Africa," said Mr Jayakrishnan.
 
In 2017, trade between Singapore and Africa amounted to S$9.78 billion according to data from Enterprise Singapore, while Singapore investment into Africa reached S$18.5 billion in 2016, making the republic its 7th largest trading partner.
 
According to the United Nations, Singapore is Africa's largest Southeast Asian trading partner.
 
Enterprise Singapore highlighted two growth engines in the areas of deepening digital capabilities and addressing Africa's manufacturing needs.
 
According to a McKinsey report, Africa’s consumer spending is expected to reach US$2.1 trillion (S$2.86 trillion) by 2025, and that its e-commerce purchases are projected to hit US$75 billion (S$102 billion) in the same year.
 
"Africa’s rapid growth and thriving digital economy offers rich opportunities for Singapore companies seeking higher growth and market diversification,” said CEO of Enterprise Singapore, Mr Png Cheong Boon.
 
At the event, an Avoidance of Double Taxation Agreement (DTA) between Singapore and Gabon was signed, bringing the list of DTAs between Singapore and Africa to 13. A total of five memoranda of understandings in areas of digital, infrastructure and business services were inked between African and Singapore companies.
 
One is a tie-up is between media analytics firm Graymatics, and IT company Crescentech to provide security and surveillance solutions in Kenya, South Africa and Nigeria.
 
President and CEO of Graymatics Abhijit Shanbhag said Enterprise Singapore has played a big role in the collaboration.
 
"Enterprise Singapore had organised a mission within Africa which we participated in within Kenya and within that, that was actually the start of a number of business engagements that we had in Africa," said Mr Shanbhag.
Director of Strategy & Innovation for Crescentech, Dr Percy Opio, said
 
"Enterprise Singapore is very specific about who they want us to partner with, they want us to partner with organisations that have relevant solutions for our market.”
 
“We believe that this process will not only provide solutions in Kenya, but Graymatics will also empower us," he said.
 
 
Chan Chun’s speech:
 
Introduction
 
1.         It is a pleasure to join you this morning at the fifth Africa Singapore Business Forum. I would like to begin by extending a warm welcome to our friends and esteemed guests from Africa. Thank you for your presence and for your support in building stronger and deeper Africa-Singapore and Africa-Asia relationships.
 
2.         The Africa Singapore Business Forum, organised by Enterprise Singapore on a biennial basis, brings together leaders from the worlds of government and business to participate in a week of activities focused on Africa, Singapore, and Asia. This week, Singapore is also hosting the third Singapore-Sub-Saharan Africa High-Level Ministerial Exchange Visit organised by the Ministry of Foreign Affairs, and the International Leadership in Governance Programme organised by the Centre for Liveable Cities.  These are all valuable avenues to foster greater interaction between Singapore and countries of Africa.
 
 
Working together and integrating our economies
 
3.         Today, all of us are facing very challenging circumstances in the global economic environment. While the economies of Africa and Southeast Asia continue to work towards openness and integration, we also see other countries retreating from globalisation because of their domestic difficulties. In the news, we hear of tariffs, trade tensions between major players, and protectionism on a regular basis. We are already seeing the real effects of such actions and rhetoric on the commercial decisions of many companies- some of them have been directly impacted and are laying off workers, others are relocating their facilities and reassessing their strategies in response to such developments. Against this backdrop, it is important that we continue to believe in, and promote and support economic integration and cooperation, with a strong conviction that open economies, connected economies, interdependent economies, ultimately provide better jobs and better income for our people.
 
4.         Regional integration has been taking place on the African continent for many years and is also steadily taking place here in Southeast Asia. In Africa, we are seeing important regional integration efforts. The Continental Free Trade Area, an ambitious effort to create a unified African market from Cape Town to Cairo, is well on its way. In East Africa, trade facilitation efforts are in progress to support a more efficient and fuss-free merchandise trade. Notably, Singapore e-solutions company, VCargoCloud, piloted the East African Community (EAC) Single Customs Territory System which enables the seamless transmission and exchange of trade-related documents between participating countries’ revenue and port authorities’ systems. This would enable the more efficient movements of goods within the EAC and ultimately reduce the costs of doing business in the countries of EAC. 
 
5.         Regional integration efforts within ASEAN are also well underway. As the ASEAN Chair this year, Singapore, together with our fellow ASEAN Member States, are working towards the full implementation of the ASEAN Single Window and the ASEAN-wide Self-Certification regime to enhance intra-ASEAN trade, reduce trade transaction costs and facilitate the digitalisation of trade procedures within ASEAN.  We are also working hard to substantively conclude the sixteen-party Regional Comprehensive Economic Partnership (RCEP) negotiations with our dialogue partners this year.  When concluded, the RCEP will be the world’s largest trading bloc, covering about one-third of the world’s gross domestic product (GDP).
 
 
Africa-Singapore Economic Engagement
 
6.         With regional integration taking place in both our regions, and with our shared desire for greater openness, and for us to promote trade and investment relations, there is much scope for Africa and Asia to work more closely together.  Singapore has trade with almost every country in Africa. The trades are in a diverse range of products from fruits such as oranges and grapes to electronics and petroleum products; and in services such as transport, logistics and IT services.
 
7.         In the early years of Singapore’s independence, our leaders had made many business missions to Africa to promote and advance trade and investment relations. These business missions continue to be an important way of introducing our companies to the African market and helping African businesses develop an understanding of Singapore. In the past 13 years, the Singapore Business Federation has organised 39 business missions to Sub-Saharan Africa and North Africa.
 
8.         Over the years, we have also deepened our understanding of one another and we have seen our respective companies – large and small enterprises alike - form partnerships and pursue market opportunities in various sectors.  Today, a number of commercial Memoranda of Understanding (MOUs) will be exchanged, and the diversity of these MOUs are a reflection of the many commercial prospects present in Africa.
 
9.         In the digital space, Graymatics, a Singapore company with scalable cloud platform solutions, will exchange an MOU with Kenyan ICT specialist, Crescentech to partner in verticals such as security, banking, telecommunications, and retail. They hope that their partnership will allow them to expand their presence beyond Kenya into countries such as South Africa and Nigeria.
 
10.       Singapore-based design and construction company Well & Able is making its first entry into Senegal. It has secured a contract with Senegal’s CSTT-AO to design and build a multimodal modern logistics terminal. This logistics hub will comprise a 7,500 square metre container terminal which can accommodate more than 1,000 TEUs and a warehouse for general cargo.
 
11.       Singapore Cooperation Enterprise will also be signing an MOU with Mozambique’s Investment and Export Promotion Agency to provide consultancy and advisory services in the areas of Ease of Doing Business, Urban Planning and Special Economic Zones, and Technical and Vocational Education Training.  I hope that this cooperation will pave the way for more Singapore companies to develop partnerships and explore the trade and investment opportunities in Mozambique.
 
 
Engaging Africa for the long-term
 
12.       We continue to welcome more Africa-Singapore partnerships at the government, business and people levels. Enterprise Singapore’s three overseas offices in Africa in Accra, Ghana; Johannesburg, South Africa; and most recently in Nairobi, Kenya, are important linkages to strengthen our in-market networks. 
 
13.       At the government-to-government level, it would also be essential for our governments to continue forging partnerships and create conducive environments to support business-to-business interactions between Africa, Asia and Singapore.  Trade-enabling agreements such as Bilateral Investment Treaties and Avoidance of Double Taxation Agreements will go a long way in encouraging companies to venture abroad. In recent years, Singapore has been expanding our treaty network with African countries to reassure our investors and lower the costs of doing business for our companies. Recently in June, we signed a Bilateral Investment Treaty with Kenya; and Avoidance of Double Taxation Agreements with Kenya and Rwanda.
 
14.       Increasing physical connectivity through various aviation agreements would also be a practical enabler of greater business linkages. Ethiopian Airlines and Air Mauritius are currently the only two African airlines flying to Singapore and we hope and encourage to see more African carriers do the same in future.
 
15.       Beyond formal government engagements, our research institutes such as the Centre for African Studies, and our companies which are already in Africa, are all important members of the “Africa network” of partners and practitioners who can share their experiences in Africa with others in Singapore. I also encourage our partners from Africa to share your insights on Asia and Singapore with your own networks, so that collectively, information and awareness of one another continues to grow. Every bit helps in our effort to build broader and deeper relations between Africa and Singapore.
 
16.       I would also like to encourage our African businesses to engage Singapore as your partner in Asia, see Singapore not only for our domestic market, see us also as a platform, as a launchpad for your business opportunities in Southeast Asia and beyond. Singapore’s stable and conducive business environment, eco-system of foreign and local companies, coupled with strong support infrastructure had made Singapore an ideal partner for African companies such as Sahara Energy and Sasol Chemicals. Our strong connections at the government and business level makes us a good base from which African companies can explore and access Asia.
 
 
Closing
 
17.       I would like to congratulate Enterprise Singapore for convening this very timely and important forum. The strong turnout of African and Asian political and business leaders, and the various agreements which will be signed today, are all strong signals of our confidence in the opportunities in Africa and the continent’s bright future.
 
18.       I wish everyone a fruitful day ahead. Thank you.​



 
 
Source: MTI
 
https://www.mti.gov.sg/NewsRoom/Pages/Speech-by-Minister-Chan-Chun-Sing-at-the-5th-Africa-Singapore-Business-Forum-2018.aspx