Chart of the Day: Can Singapore keep its lead on ASEAN trading activity?
New trading policies are key.
Singapore continues to lead the pack when it comes to trading, as the new streamlined regulations bolsters the city-state’s status as a major distribution hub for the region, particularly to US multinationals.
According to a report by BMI, in 2015, medical device imports into the city-state amounted to US$3.3b ($4.52b), while exports reached US$5.9b ($8.09b). This gave a balance of trade surplus of US$2.7b ($3.7b).
BMI notes that this represents about half of all trading activity within the Association of Southeast Asian Nations (ASEAN). Imports and exports have both seen robust growth over the past five years, recording 2010-2015 CAGRs of almost 14%.
However, import grew tepid as it dropped negative from 2014, while export growth stayed positive but muted. BMI expects export growth will sustain in 2016.
Meanwhile, BMI reports that USA accounted for almost a third of imports in 2015. Mexico, which is used as a manufacturing base by several US multinational firms, accounted for a further 14.1%.
Majority of imports were for re-export, given the size of the Singapore market, which BMI values at US$525m ($720.4m) in 2015.
In addition, the US is also the leading destination for Singapore’s exports, trailed by China and Australia. Until recently, China was the fastest growing destination, but US-bound exports increased at thrice the rate to China last year.
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