Friday, October 22, 2021

UK and Singapore sign free trade deal as Brexit talks run down to the wire

Singapore counts Britain as its top investment destination in Europe.

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As British Prime Minister Boris Johnson and European commission President Ursula von der Leyen meet this weekend in a last-ditch attempt to seal a Brexit trade pact, Britain signed a free trade deal with Singapore on Thursday.

The deal signing between Britain’s trade minister Liz Truss and her Singaporean counterpart Chan Chun Sing is the second-biggest such agreement Britain has signed in the Asia-Pacific region, after Japan.

Singapore’s Trade and Industry Minister Chan Chun Sing said that the agreement will “provide continuity and certainty” for businesses in both countries.

The deal removes tariffs, gives both countries access to each other’s markets in services and cuts non-tariff barriers in electronics, cars and vehicle parts, pharmaceutical products, medical devices and renewable energy generation.

Duties will be eliminated by November 2024, the same timeline as the agreement between the EU and Singapore, a former British colony that maintains close links with London.

“55 years after Singapore’s independence, the UK is re-emerging as a fully independent nation, and a major force in global trade,” Truss said ahead of the signing. “Together, we’re paving the way for a brighter future, rich in economic potential and opportunity.”

Singapore counts Britain as its third largest trading partner for goods and second largest for services, and its top investment destination in Europe.

Under the agreement, tariffs will remain eliminated for 84% of all Singapore exports to the UK, said a joint ministerial statement by Singapore and the UK.

“Singapore Asian food products such as har gow (prawn dumplings) and sambal ikan bilis (spicy crispy anchovies) will continue to enter the UK tariff-free under flexible rules of origin, up to a combined quota of 350 tonnes annually,” the joint statement said.

“Singapore will also continue to bind our current level of duty-free access for all UK products entering Singapore, and maintain protections on iconic UK goods such as scotch whisky.”

Total bilateral trade between the two countries was valued at US$13.5 billion in 2019, according to Singapore’s official figures.

Britain formally left the European Union at the end of January and has spent the year negotiating its future relationship with Brussels and striking trade agreements with major economies such as Japan and Canada.

Failure to agree new rules to govern everything from trade to energy ties would snarl borders, shock financial markets and sow chaos through supply chains in a world already grappling with the economic cost of Covid-19.

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