SINGAPORE (Oct 24): Singapore is looking to lead digital trade efforts at the World Trade Organization through a Joint Statement Initiative (JSI) on e-commerce, says S Iswaran, Minister in-charge of Trade Relations.
Under this initiative, Singapore will “support the development of baseline rules on digital trade and act as a bulwark against digital fragmentation,” he says.
Speaking at the opening of the Free Trade Agreement (FTA) Symposium on Wednesday, Iswaran notes that the Digital Economy Agreements will also look into emerging areas such as artificial intelligence and digital identities.
He points out that Asean’s digital economy alone is expected to grow three times its annual size to US$300 billion ($409 billion) by 2025.
Singapore has already begun working on this with like-minded countries such as Australia, Chile and New Zealand, Iswaran says. And he notes that negotiations are “progressing well”.
Through its network of more than 24 free trade agreements with 36 trading partners, trade now accounts for more than three times Singapore’s gross domestic product (GDP).
Indeed, trade has become the republic’s lifeblood.
“Our FTAs are with countries that collectively account for more than 85% of global GDP and more than 90% of Singapore’s trade,” says Iswaran. “These FTAs have gained our businesses access to millions of consumers in markets across the globe.”
He notes that the FTAs have provided preferential access to service sectors, expanded government procurement opportunities, and improved intellectual property protections.
“These FTAs also provide legal certainty and help to safeguard the interests of Singapore businesses in overseas markets,” he adds.
According to a study by the Ministry of Trade and Industry, businesses are estimated to gain an average of 18% higher trade deals after two years and a further 16% in the third year as a results of these FTAs.
This has translated into businesses saving about $720 million in tariffs in 2016, higher than the $450 million saved a decade before that.
And now, the Singapore Business Federation is intensifying its outreach and education efforts to increase awareness and help businesses to navigate FTAs, so that more Singapore companies expand into new markets.
Even so, Iswaran opines that the current trade regulations do not sufficiently address digital needs. With digitalisation becoming more rampant, he notes the need to beef up digital trade regulations.
He also emphasises that free and open trade does not always generate equitable outcomes, noting that this why Singapore is investing in training of workers and helping businesses transform and adapt to the digital era.
"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," Iswaran says.
Amid an uncertain global economy, Iswaran notes that there have been constraints to multilateral negotiations due to wide ranging interest that tempt members to converge on the lowest common denominator.
"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 says.
