SBF: More scope to grow Singapore-Spain business links

Madrid

THERE is a good flow of trade and investment between Singapore and Spain, but government officials and business leaders from both sides agree that the levels could be much higher.

The total bilateral trade in 2013 of about S$1.7 billion was equal to a little over 1 per cent of the entire volume of bilateral trade between the European Union (EU) and Singapore.

And while that figure rose to S$2 billion last year, there is still much potential for growth and both sides should explore new opportunities for growth, said Singapore Business Federation (SBF) chief executive officer Ho Meng Kit.

He was speaking at the Spanish-Singapore Business Forum held at the office of the Spanish Confederation of Employers' Organisations (CEOE) in Madrid on Thursday.

The event was held on the sidelines of Singapore Prime Minister Lee Hsien Loong's first official visit to Spain.

The CEOE is a private, non-profit organisation founded in 1977 that represents the Spanish business community. It groups together two million companies and self-employed entrepreneurs from every sector of the Spanish economy.

With Mr Ho during the hour-long session were senior executives from 16 Singapore companies from sectors such as banking and financial services, commodity trading, energy, hospitality and real estate.

Among the Spanish representatives present were officials from the Ministry of Economy and Competitiveness and the heads of national associations such as those for agriculture, construction and private education.

Mr Ho called on the small and medium-sized enterprises (SMEs) from Singapore and Spain to work with each other to boost productivity and innovation levels. The SBF chief also suggested that Singapore companies tap Spain's expertise and experience to expand into the Latin America market, a region expected to grow 2.2 per cent this year.

Spain's secretary of state for trade Jaime Garcia-Legaz said at the forum that his country's Gross Domestic Product (GDP) was forecast to grow by 2.3 per cent this year and 2.5 per cent in 2016, making Spain the fastest-growing economy in the eurozone:

"The Spanish economy has been accelerating quarter by quarter, and no other country (in the EU) has been able to put in place such a big and deep package of structural reforms like we have in the last few years."

Mr Garcia-Legaz, who stressed that the Spanish government regards Singapore as a "priority destination" in its trade and investment policy, said there was scope for cooperation in the infrastructure, real estate and energy sectors, among others.

Singapore's Second Trade and Industry Minister S Iswaran, who joined the talks midway through the event, said that although Europe has gone through some challenging times of late, it remained a "very important market" for many countries, including Singapore.

He praised the fact that the European Commission signed a deal with Spain last month to unlock more than 3.2 billion euros (S$4.9 billion) of additional lending to SMEs.

"This is a very important development. SMEs are the engines of the Singapore economy and Spain's as well. While we believe that the big companies can navigate and find opportunities on their own, we need to work with SMEs and help create pathways for them to forge new partnerships and collaborations," he said.

SMEs make up 99 per cent of all enterprises in Singapore, contribute to half of the total GDP and employ more than 60 per cent of the workforce. Over in Spain, SMEs account for three-quarters (about 74 per cent) of private-sector employment and 85 per cent of newly-created jobs.

Officials and business executives from both Singapore and Spain also supported the early ratification of the EU-Singapore free-trade agreement. The negotiations for this landmark deal - the EU's first with a Southeast-Asian country - were concluded last October.

When it eventually comes into force, businesses will enjoy significant tariff elimination and a simplification of cross-border procedures, among other benefits.