S’pore, EU conclude talks on investment protection

SINGAPORE — The Republic and the European Union (EU) have completed talks over the investment protection clauses of the EU-Singapore Free Trade Agreement (EUSFTA), marking the successful conclusion of the negotiations of the entire deal, the key parts of which were signed in September last year.

“The Investment Protection Chapter in the EUSFTA will strengthen investment relations between the EU and Singapore. The chapter commits both the EU and Singapore to ensuring a stable and fair regime for foreign investors while preserving the right of the parties to regulate in the public’s interest,” the Ministry of Trade and Industry (MTI) said yesterday.

The EUSFTA is a comprehensive agreement that will provide greater access to each other’s markets, including through the liberalisation of services, investment and procurement markets, and the removal of tariff or non-tariff barriers to trade.

“Singapore exporters of electronics, pharmaceuticals, chemicals and processed food products in particular will benefit from the removal of the EU’s tariffs, while EU exporters will be granted immediate duty-free access to the Singaporean market for all products. Businesses from both sides will also be able to gain access to each other’s services markets in a wide range of sectors,” the MTI said.

The EUSFTA is the first deal between the EU and a South-east Asian economy and reflects the strong economic ties between the two. Last year, the EU was the Republic’s third largest trading partner, with bilateral trade standing at S$96.5 billion. There are over 10,000 European companies in Singapore, many of which use the city state as a regional hub.

In terms of investment flows, the EU was the largest contributor of foreign direct investment (FDI) into Singapore, accounting for almost S$190 billion, while Singapore was the 2nd largest Asian investor into the EU with S$60.3 billion FDI in 2012.