Singapore Reopening Boosts Thai Investment
Singapore Government urges local companies to diversify production sources.
Consumer demand for e-marketplaces remains high even after the country reopened.
Singapore is a free trade market while applying strict standards on food products.
Like all countries, Singapore has had to cope with the COVID-19 pandemic situation which include new waves and enforcement of tighter restrictions several times. After the announcement of Phase 3 of the country’s reopening plan on 28 December 2020, the recent clusters at KTV lounges and the Jurong Fishery Port put Singapore back to Phase 3 (Heightened Alert) from 19 July 2021 through 8 August 2021 and subsequently Phase 2 (Heightened Alert) from 22 July 2021 through 18 August 2021.
On 8 August 2021, Prime Minister Lee Hsien Loong delivered a National Day Message, stating that Singapore was preparing to reopen its economy and laying the groundwork to live with the coronavirus as it did other common diseases such as influenza. From 10 August 2021 the country has been in Preparatory Stage of further opening up the economy and the resumption of social activities and travel in early September.
The plan has resulted in more shoppers returning to offline shopping. Yet the popularity of online shopping continues as it provides consumers with a more convenient and quicker access to the products they wish to purchase, says Supranee Kongkiatkamon, Minister Counsellor (Commercial) of Royal Thai Embassy and Director of Thai Trade Center, Singapore.
“Since the country reopened, some Singaporeans have turned to offline spending due to a desire to touch the products they wanted to buy. Some of them continued using online channels because it’s more convenient, and the fact that products and services can be accessible for them from anywhere and at any time,” she says.
Trade between Thailand and Singapore in the second quarter of 2021 increase by 0.5%, compared to the same period in 2020. The products that are most exported are Gems and Jewelry, computer equipment and components, refined oil, Circuit board, Aircraft, spacecraft and components, and Air conditioning and components while the products exported decreased, including Chemicals, Circuit breaker and protection, Cosmetics, soaps and skin care products, Vehicles, equipment and components, and Lens.
Trade between the two countries is expected to start recovering in line with the world economic recovery sparked by the global vaccination programme, as well as the Singapore government’s policy to encourage companies to diversify sources of products imported and spread risk in terms of production. This is expected to benefit Thailand.
However, Kongkiatkamon has a word of caution, saying that, “the new wave of COVID-19 that has recently hit Thailand, Singapore and many other countries, may become a major obstacle to economic activities and the expansion of the overall trade between Thailand and Singapore.”
She emphasises the potential of trade opportunities through improving products quality by adding innovation as well as understanding market needs and Government’s standards and regulations for exported products to Singapore. According to her, e-marketplaces such as Lazada, Qoo10 and Shopee as well as the country’s leading online-supermarkets, including Redmart and Fairprice have become popular among Singaporeans.
DITP’s trade promotion events such as business matching activities and trade events have been moved towards online platforms, such as Bangkok RHVAC 2020, and World International Direct Export (W.I.D.E), as well as Export Clinic and THAIFEX – Virtual Trade Show.
“Singapore is a free-trade market, with no taxes upon importers and exporters, but also is very strict in terms of product standards especially food products,” says Kongkiatkamon.
She emphasises the need for Thai businesses to constantly develop their product quality to meet international standards, as well as tailoring their strategy in accordance with the needs of the new generation of consumers, whose behaviour is constantly changing. This will allow them to compete successfully in the world’s major trading markets like Singapore in the future.
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Words by Ayer Chengtrakun