Singapore is the most trade-conducive economy in the world, according to an influential report which put its long-time rival Hong Kong at second place. The World Economic Forum (WEF) pointed to Singapore's many advantages, including policy approaches, that have made it Number 1.
Its Global Enabling Trade Report cited the open market, highly efficient and transparent border administration, well-developed transport and communications infrastructure, and an open business environment.
“Customs procedures are assessed as the least burdensome in the world, and time and cost for both import and export are among the lowest for all countries covered,” the report said.
The WEF highlighted that the Singapore Government is highly transparent and efficient, while exporters face relatively low tariffs in target markets.
The WEF said Hong Kong's open domestic market mirrored Singapore's high dependence on exports and imports, but also noted that Hong Kong's exported products faced more barriers than Singapore's, as reflected in the tariffs it faced.
Barclays Capital economist Leong Wai Ho believes the differentiating factor for Singapore's success has been the numerous Free Trade Agreements (FTAs) it has signed. “We're the most trade-dependent economy in the world,” Mr Leong pointed out. “These FTAs have given us access to key trading partners and it's already showing up in the rankings.”
Minister Mentor of Singapore Lee Kuan Yew recently told Malaysian leaders that Singapore businessmen have thousands of projects in China, Vietnam, India and the Middle East, and that they are benefiting from the web of FTAs the country has signed.
The report, published for the second time and covering 121 economies, assesses institutions, policies and services that facilitate trade across national borders. The other economies in the top 10 are Switzerland, Denmark, Sweden, Canada, Norway, Finland, Austria and the Netherlands.