Singapore and the European Union (EU) held discussions on strengthening bilateral digital trade, including with a view to advance towards a comprehensive EU-Singapore digital partnership. In that context, they tasked EU and Singapore officials to start technical discussions and identify the relevant digital trade elements.
The joint announcement signals the EU’s commitment to deepening digital cooperation with like-minded partners in the Indo-Pacific region, coming after the EU Indo-Pacific Strategy that states the EU’s interest to explore the launch of negotiations on a Digital Partnership Agreement with Singapore. It also demonstrates Singapore’s leadership in this dynamic area of trade policy and underscores the strong interest of EU companies to participate in the large Southeast Asia digital economy, projected to be more than triple in value between 2020 and 2025.
The partnership marks Singapore and the EU’s shared vision of bringing their strong bilateral trade partnership into the digital future, building on the entry into force of the EU-Singapore Free Trade Agreement in 2019. This will further deepen digital ties and expand bilateral trade and investments, ensuring that workers and businesses, especially small and medium enterprises, benefit from opportunities in the growing global digital economy.
Singapore and the EU’s efforts will contribute to region-to-region collaboration between the EU and ASEAN in this fast-growing area. The new engagement will also complement and support ongoing World Trade Organisation e-commerce negotiations that should set global rules on digital trade.
Strengthening their digital economy cooperation is a priority for both Singapore and the EU. Today, over 60% of global GDP is already digital, and both parties recognise that jobs and growth opportunities in the digital economy will become increasingly important in the future.
To maximise the benefits of the digital economy for workers, businesses and societies, it is important to ensure the connectivity and interoperability of digital markets and policy frameworks, to lift barriers and facilitate digital trade, as well as to provide legal certainty for businesses and to protect consumers.
Singapore and the EU reaffirmed the strong bilateral trade relations. In 2020, annual bilateral trade in goods and services exceeded €100 billion in value. While international trade was hit hard by COVID-19, the EU-Singapore Free Trade Agreement (EUSFTA) provided businesses with predictability and certainty.
Singapore and the EU also exchanged views on global and regional trade developments, as well as ways to strengthen the post-pandemic economic recovery. They reviewed the smooth EUSFTA implementation to date, including the successful early commencement of the Trade and Sustainable Development Board meeting and issues such as labour and fundamental ILO conventions, as well as green economy cooperation.
As reported by OpenGov Asia, the world’s first cross-border digital trade financing pilot was recently rolled out by Singapore and Abu Dhabi (UAE). The pilot was carried out in collaboration with the Monetary Authority of Singapore (MAS), Singapore’s Infocomm Media Development Authority (IMDA), Abu Dhabi Global Market’s Financial Services Regulatory Authority (FSRA), and commercial partners.
Due to increasing trade tensions, market volatility, and the ongoing repercussions from the COVID-19 crisis, global trade is experiencing a period of increased uncertainty. Banks that support international trade are more conscious than ever before of the relevance of digital operating models and the benefits they may provide. Although digital transformation is overtaking the financial industry, banks that facilitate international trade are still looking for new methods to improve their ageing trade finance functions.
IMDA, MAS and FSRA will continue to work together in an incremental approach with the goal of encouraging our businesses to phase out and replace paper documents with digital documents as the standard practice in trade finance. Following the pilot, appropriate technologies and trade platforms can be used for live goods shipments between the UAE and Singapore. Other businesses interested in implementing TradeTrust are encouraged to reach out to IMDA, MAS, FSRA, or any of the partners.
