Singapore-British ties to grow stronger after it leaves EU
Deeper collaborations, and new trade deal on the cards after completion of Brexit
Singapore's free trade agreement (FTA) with the European Union is yet to be ratified, but already the economic community is gearing up for a fresh deal with its soon-to-be former member - Britain.
Bilateral trade between Singapore and Britain might be small, but the long-standing ties between the two will give this agreement a level of significance when it gets to the negotiating table, experts said.
Prime Minister Lee Hsien Loong told the BBC last Friday that Singapore would sign a trade deal with Britain after it exits the EU.
His remarks followed those made by British High Commissioner to Singapore Scott Wightman, who last Wednesday said Britain is ready to explore deeper collaborations with Singapore in areas such as data science and healthcare.
OCBC Bank economist Selena Ling noted that areas of traditional collaboration, such as business and legal services, and education, will likely be important areas of discussion as well.
IE Singapore data shows total trade between Singapore and Britain amounted to about $11.5 billion last year, or 1.36 per cent of Singapore's total international trade.
This may be a small figure, but there is a lot about Britain that will interest the business community, and vice versa, noted CIMB economist Song Seng Wun.
There are many Singapore companies with operations and investments there...British companies, in turn, see Singapore as a gateway to the region.CIMB economist Song Seng Wun
"There are many Singapore companies with operations and investments there, including household names such as GIC and Temasek Holdings. British companies, in turn, see Singapore as a gateway to the region."
But Ms Ling noted there is still much uncertainty before the two countries even get to the negotiating table.
"British Prime Minister Theresa May has a lot on her plate. The UK Supreme Court has yet to rule on whether she can even begin the talks to leave the European Union (EU)," she said.
Mr Song agreed, noting that talks on a free trade agreement can only happen some years from now, once Britain has completed its divorce from the EU.
He said: "This could be more than two years down the road."
The EU is Singapore's third-largest trading partner.
The EU-Singapore FTA involves the EU eliminating tariffs on all imports from Singapore. Singapore exporters of electronics, pharmaceuticals, chemicals and processed food products particularly stand to benefit.
Separately, Deputy Prime Minister and Coordinating Minister for Economic and Social Policies Tharman Shanmugaratnam is visiting Germany, Brussels and Britain. He flew to Stuttgart, Germany, yesterday.