Singapore ranks third on sustainability trade index
Wong Pei Ting
SINGAPORE moved up two spots to emerge third on an index measuring the ability of 30 major economies to participate in the global trading system in a manner that supports long-term economic growth, societal development and environmental protection.
The country’s improvement on the Hinrich-IMD Sustainable Trade Index came amid a trend towards “slowbalisation”, under which economies close in to strengthen their own domestic industries, while redefining terms for global exchanges, the index makers said.
Singapore was fifth on the index last year, after Japan. This year, Japan slid on the rankings from fourth to eighth place.
The top two on this year’s index are New Zealand, which retained the top spot with 100 points, and the United Kingdom, which scored 96.5. Singapore got 94.1 points.
Hong Kong was placed fourth, at 85.6 points. Australia and South Korea followed, at 84.5 and 84.2 points respectively. The country that made the greatest improvement in ranking was the Philippines, which jumped seven places to 12th this year.
A yearly effort of the Hinrich Foundation, an Asia-based philanthropic organisation, and the Institute for Management Development (IMD), an independent academic institute based in Lausanne and Singapore, the index analyses countries based on 71 indicators.
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‘Slowbalisation’ apparent
In a statement, Hinrich Foundation and IMD said this year’s results showed that slowbalisation had taken root. The phenomenon, happening against a backdrop of rising geopolitical tensions, is marked by a slowdown in trade reform and weakening political and policy support for measures that open up trade.
The two bodies said that the index showed a deterioration across key economies in non-tariff barriers and trade costs this year, compared to 2022.
They added that the data shows that the world’s largest economies – which should be leading efforts to reverse slowbalisation – are instead among the key countries that are raising tariff and non-tariff barriers, and slowing trade liberalisation.
It is against this backdrop that Singapore has emerged as a leader. The top three countries are “illustrative examples of harmonious coexistence between trade and sustainability goals”, they said.
The organisations also pointed out that this year’s high-ranking economies shared discernible traits: They uphold high environmental standards, and effectively address challenges related to wastewater, air pollution, carbon and energy intensity.
They also have robust infrastructure and are inclined towards technology innovation, and are characterised by political stability, economic equality, high educational attainment and social mobility.
Countries at the bottom of the index are Russia, Myanmar, Papua New Guinea, Pakistan and Brunei. The US was placed ninth, with 77.2 points; China came in 16th with 50.1 points. Malaysia was 14th, with 58.1 points.
Professor Arturo Bris, director of IMD’s World Competitiveness Center, which produces the index in partnership with the Hinrich Foundation, said the data this year shed light on a trade-off being played out.
He said: “With global trade challenged by geopolitical and health issues, the work of streamlining supply chains and reducing costs has become paramount, even at the expense of social or environmental considerations in global trade.”
Kathryn Dioth, the chief executive officer of the Hinrich Foundation, said the global trade system is “experiencing fragmentation that threatens to erode the achievements of 70 years of globalisation”.
“Protectionist trade policies are being implemented under the guise of responding to the headwinds of post-pandemic inflation and geopolitical tensions. And while global trade continues to expand in value, that is mainly due to higher commodity prices,” she added.
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