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Singapore and EU Sign Historic Free Trade Agreement

October 21, 2018

The Singapore government announced on October 19 it and the European Union signed off on a major free-trade agreement (FTA) on October 19.

The signing took place at EU offices in Brussels.

As part of the agreement, Singapore will eliminate tariffs on 100% of products coming from the EU. For its part, the European Union will drop tariffs immediately on 84% of Singapore’s products and phase out tariffs on the remaining 16% within three to five years.

The agreement also sets up a new dispute-resolution mechanism for investors.

Other clauses in the agreement cut technical barriers in sharing information between the countries. The agreement is also designed to provide better opportunities in services and government procurements under the deals

The agreement, which began negotiations in 2018, replaces all other bilateral trade agreements between Singapore and the EU.

As Prime Minister Lee Hsien Loong said in a statement released on his Facebook page, the new agreements “give Singapore companies greater market access to the EU and will boost confidence for investors and entrepreneurs.”

Singapore’s minister for communications and information, S. Isvaran, said, “Both agreements serve as building blocks toward an eventual EU-Asean FTA

The new pacts will be highly lucrative for both parties. Total bilateral trade between the regions was over S$98 billion (US $71 billion) in 2017. For that year, Singapore was the EU’s largest trading partner in southeast Asia, and the European Union was Singapore’s third-largest trading partner.

 

Prime Minister Lee of Singapore said the FTA should be formally ratified by next year.

Copyright: North America Procurement Council Inc., PBC