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Strong economic ties

Singapore Business Federation CEO Ho Meng Kit says that Singapore's warm relations with Switzerland are underpinned by longstanding trade links.
Thursday, July 27, 2017 - 05:50

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Mr Ho: "Our businesses can adopt the Swiss mindset of continual improvement and taking ownership in educating and training employees."

Question: As Singapore and Switzerland mark 50 years of the establishment of diplomatic relations this year, how do you see the current status of the bilateral relations both at the government-to-government and private sector business levels?

Ho Meng Kit: Both Singapore and Switzerland enjoy warm bilateral relations, underpinned by strong economic ties and longstanding trade links. Bilateral trade between our two countries was S$15.7 billion in 2016, an 8.1 per cent increase from 2015. Within South-east Asia, Singapore is Switzerland's most important trading partner. In Singapore, there are 400 Swiss companies employing some 28,000 people.

Question: While there are about 400 Swiss companies already operating in Singapore, how can the already strong business ties between Switzerland and Singapore be strengthened further? What should Singapore companies be doing to further grow the bilateral business ties?

Mr Ho: In 2014, Singapore and Switzerland signed a Declaration of Enhanced Partnership, signifying a mutual interest to strengthen bilateral relations. The signing of the European Free Trade Association with Singapore in 2003, the first with an Asian country, brought about a sharp increase in trade between Singapore and Switzerland.

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Question: How can the Singapore Business Federation help its members to export to markets like Switzerland, and enhance their competitiveness in this market?

Mr Ho: Beyond building capabilities, entrepreneurship is also a priority for Switzerland and Singapore. In today's fast-changing world, entrepreneurs have become instrumental in driving growth, innovation and job creation. There is room for Switzerland and Singapore to work together to take their startups and local companies into the world.

Over the years, SBF has been active in engaging Switzerland through the following:

  • In October 2015 and July 2014, SBF and the Switzerland Global Enterprise co-organised business lunches for over 20 Singapore companies keen to explore trade and investment opportunities in Switzerland. At the event, the companies gathered insights into the Swiss economy's developments and emerging opportunities after the franc was unpegged from the euro.
  • In May 2014, SBF led its inaugural business mission to Switzerland to the cities of Zurich and Lausanne, held in conjunction with Singapore President Tony Tan Keng Yam's visit. The 16-member business delegation comprised senior representatives from diverse industries including business consultancy and financial services, general trading, ICT, logistics, pharmaceuticals, port management, real estate and venture capital. SBF also organised a Switzerland-Singapore Business Forum, where a mission participant Mekong International inked an agreement with Trivarga AG to be the exclusive distributor of Trivarga's entire range of ok.- energy drinks in Singapore and Malaysia, an indication of the growing interest of European companies in Asia and Asean.
  • In October 2013, SBF supported a seminar and networking session co-organised by the Embassy of Switzerland and Canton of Vaud. Attended by over 30 participants, the seminar provided a unique opportunity for Singapore-based companies to learn more about doing business in one of the most prosperous regions in Europe. A networking session enabled the participating companies to meet business representatives from 20 Swiss companies to explore business partnerships.
  • In November 2012, SBF supported the Singapore and Swiss Business Forum co-organised by Spring Singapore and PwC to promote business partnerships between the two countries.

Question: Both Singapore and Switzerland are leading global financial centres - what are some of the ways they could potentially collaborate in to grow in this area to mutual benefit? In your view, what are some of the new business areas that hold promise for both Singapore and Switzerland companies? Is the SBF planning any initiatives to further grow Singapore-Swissbusiness ties?

Mr Ho: In the finance, banking and services sector, the digitisation and establishment of "smart financial centres" through technology and innovation, not just for big data analytics and insights, but also for risk management, governance and financial regulations are some emerging trends. As these developments could potentially disrupt and transform financial services, Switzerland and Singapore, as world-class financial hubs, have shared interests to collaborate, seize opportunities together and stay globally competitive.

Another example is the recently announced strategic cooperation between OCBC Bank's subsidiary Bank of Singapore and Swiss banking group Bank Vontobel AG. The agreement allows Bank of Singapore's ultra-high and high net worth clients in Asia to open an account and place their assets in Vontobel's Zurich booking centre.

The clients have the option of choosing Vontobel or Bank of Singapore to manage their assets booked in Zurich. Such collaborations expand on the capabilities and enhance the competitiveness of both parties.

One promising area for Swiss and Singapore businesses is in the biotechnology and pharmaceutical sector. Novartis, Roche and Lonza already have existing manufacturing facilities here and Singapore can do more to partner other small and mid-sized firms. Singapore is well-positioned as a hub for companies to conduct their R&D activities. With our diverse population and access to the Asian region, Singapore presents a good testbed for clinical trials.

In the fintech space, an agreement signed between the Monetary Authority of Singapore (MAS) and the Swiss Financial Market Supervisory Authority (FINMA) last year will bring about greater cooperation. The agreement will enable Swiss and Singapore fintech companies to expand into each other's markets and beyond. Singapore fintech companies can leverage on Switzerland to expand into Europe. Conversely, Swiss fintech companies can access Asian markets through Singapore.

Question: Switzerland is a world leader in fostering skills development and has a strong history in this area through active collaboration with businesses which provide hands-on training to youth. What can Singapore learn from the Swiss experience in this area and how can our businesses be encouraged to become anactive partner in skills development?

Mr Ho: For small countries like Switzerland and Singapore with limited natural resources, great emphasis is placed on developing human capital and talent. Switzerland and Singapore occupy the top two spots in the Global Talent Competitiveness Index 2017. In our current environment where new jobs are being created and traditional jobs are changing rapidly or disappearing, lifelong learning has become particularly important. Beyond learning from the Swiss system of education and training, our businesses can adopt the Swiss mindset of continual improvement and taking ownership in educating and training employees.

In the future economy, countries, businesses, and people who are ahead of the curve in embracing technology and innovation will have the upper hand. With digitalisation transforming the global economy, it is critical for Singapore to broaden and deepen the skillsets of its workforce. Singapore can take a leaf out of Switzerland's book in keeping its workforce relevant and employable. This is particularly important as Singapore rolls out Industry Transformation Maps and SkillsFuture to promote the growth and competitiveness of its industries and the employability and resilience of its workforce.

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