Singapore is third in sustainable trade index, down from first in 2016

Singapore

AMONG 19 Asian economies, Singapore came in third this year in a race to trade in a sustainable manner.

This is a fall of two positions from 2016, when the Republic topped the Hinrich Foundation's index, which assesses economies on their environmental, social and economic performances. The fall came largely from the city-state doing less well in the environmental aspect, where it went from second spot to fourth overall.

Singapore topped the water pollution indicator with a perfect score of 100; however, it dived from top to 14th place in the air pollution indicator because of significantly higher levels of pollution of particulate matter 2.5 (PM2.5) from transboundary haze pollution.

Singapore also fared more poorly than in 2016 - the first time the report was produced - in the indicators for transfer emissions, deforestation, share of natural resources in trade and environmental standards in trade.

Meanwhile, its standing in the social and economic aspects - where it was fifth and first respectively - were unchanged.

Compiled by the the Economist Intelligence Unit (EIU), the index measures the capacity of Asian economies to take part in the international trading system in a way that supports long-term sustainable development. The US was used as a benchmark.

Singapore notched up high scores for the educational attainment and political stability social indicators - 99 out of 100 in educational attainment where the other Asian economies' average was 38.4, and 79 out of 100 for political stability, where the average was 57.6.

It also had a strong economic performance, ranking first in five areas - foreign trade & payments risk, trade costs, current account liberalisation, tariffs & non-tariff barriers to trade and technological infrastructure.

The report credited this to the country's large international port and infrastructure, established legal system, low corruption and stable financial sector.

Where Singapore did worse than the field was in its level of inequality in its society; it scored only 34 - well below the index average of 62.3.

There was also still room for improvement, especially in the gross fixed capital formation, which measures gross fixed investment in the national economy. There, Singapore scored 31, 11.2 points below the index average. Broadly, the overall index results for many countries in Asia regressed between 2016 and 2018, with general improvements in the economic pillar but declines in the social and environmental pillars.

However, Chris Clague, managing editor of the EIU, said that two years do not define a trend, and expressed hope that this was just a blip in Asia's growth towards sustainable trade.

The index factored in qualitative indicators sourced from the EIU's country reports and quantitative indicators such as export levels or trade costs. These indicators were then normalised on a scale of 0 to 100, with 0 being the lowest score and 100 being the highest. Other data sources included Unesco and the World Bank.

The index aims to be a tool for government and policy makers, corporations and communities looking to make decisions on trading sustainably.