More Singapore businesses aware of and benefited from free trade agreements in 2023: SBF
About 73% of those polled say they have gained from improved market access through FTAs, versus half in 2021
MORE Singapore businesses are aware of free trade agreements (FTAs) and have benefited from them in 2023, compared to two years ago, according to the Singapore Business Federation’s Free Trade Agreement Survey 2023.
The survey was conducted between October and December 2023. More than 800 businesses across industries in Singapore were polled, with findings supplemented by closed-door focus group discussions to better understand challenges faced in cross-border trade and investment.
The survey found that 85 per cent of respondents were familiar with FTAs in 2023, compared with 62 per cent in 2021. About 73 per cent of businesses polled said they have benefited from improved market access through FTAs, compared with only half in 2021.
The Asean Trade In Goods Agreement and Asean-China Free Trade Agreement were cited by 81 per cent and 41 per cent of Singapore businesses, respectively, as key agreements that benefited them over the past three years.
As for new regional FTAs that have entered into force, a respective 43 per cent and 38 per cent of Singapore businesses cited the Regional Comprehensive Economic Partnership and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership as the most-used regional FTAs.
Ongoing hurdles
On the other hand, businesses that did not benefit from FTAs cited agreements not being applicable to their business (43 per cent) and having insufficient knowledge of FTAs (25 per cent) as the top two reasons.
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The survey found that about two in five businesses that faced issues in obtaining tariff concessions could not meet the rules of origin to qualify for tariff preferences. A similar proportion reported experiencing discrepancies in how export and import authorities classified goods.
For businesses trading goods overseas, the top three issues faced were obtaining information on standards or certifications, labelling and market conditions (39 per cent); requiring more time to comply with new regulations by importing authorities (35 per cent); and meeting technical regulations (33 per cent).
For those supplying services overseas, issues faced included accessing markets with local monopolies or exclusive service suppliers, and restrictions on the number of foreign service suppliers (46 per cent), as well as receiving decisions on applications or authorisations in a timely fashion (34 per cent).
As for businesses investing overseas, accessing regulatory information (53 per cent), understanding the tax and social systems (53 per cent) and overcoming formal restrictions on foreign equity participation in particular sectors (47 per cent) were the key issues they faced.
Commenting on the survey’s findings, SBF said it will be launching new initiatives during the Future of Trade Forum at the Singapore Apex Business Summit on Jul 25 to better support businesses in cross-border trade and investment.
SBF’s chief policy officer Musa Fazal said: “SBF is dedicated to supporting Singapore businesses in navigating international trade and investment. Through our comprehensive capability-building programmes, we aim to equip businesses with the necessary tools and knowledge to succeed in international trade.”
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