Debated in Parliament on 3 Oct 2022.
Mr Gerald Giam Yean Song asked the Minister for Trade and Industry in light of the structural economic concerns, demographic pressures, continued zero-COVID-19 policies and intensifying major power competition that China faces, what are the steps being taken to (i) mitigate risks for Singapore Government-linked projects and investments in China and (ii) diversify and manage Singapore's economic exposure to China.
Singapore proactively diversifies our economic relations and industry development. We have strong economic ties with many countries and are party to many free trade agreements such as the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This strategy allows us to mitigate cyclical and country-specific risks.
Within this context, Singapore has good economic relations with China, which is our largest trading partner, accounting for 14.2% of our merchandise trade in 2021 and our top investment destination, with 14.4% of Singapore's stock of direct investment abroad in 2020. China's strong growth over the years has benefited Singapore's and the world's economy.
Our government-to-government projects with China are doing well. For instance, the Chongqing Connectivity Initiative – New International Land-Sea Trade Corridor has enhanced connectivity between Singapore and China, with cargo flows growing 30% year-on-year in the first half of 2022. Bilateral cooperation in the China-Singapore Suzhou Industrial Park continues to expand, with recent investments in the biomedical sector, financial services and advanced manufacturing. These projects are underpinned by a strategic commitment on both sides and are less vulnerable to the vagaries of economic cycles.
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