SINGAPORE: Businesses in Singapore and Australia will soon have more opportunities to bid for government procurement contracts and better access to each other’s markets, under an upgraded free trade agreement between the two countries.
The upgraded Singapore-Australia Free Trade Agreement (SAFTA) was ratified and came into force on Friday (Dec 1). The updated agreement was signed by the Minister for Trade and Industry (Trade) Lim Hng Kiang and Australia’s Minister for Trade, Tourism and Investment Steven Ciobo last October.
Mr Lim said: “Since Minister Ciobo and I signed the agreement last year, both sides have been working expeditiously to bring the agreement into force so that Australian and Singapore businesses can reap the enhanced benefits.”
EASIER INVESTMENTS, REDUCED REGULATORY BARRIERS
Under this upgraded agreement, Singapore companies will soon be able to bid for procurement contracts from Australia’s federal government and its eight states and territories.
Similarly, Australian companies will also benefit from improved access to Singapore’s government procurement contracts.
Additionally, Singapore investors will not need to seek approval from Australia’s Foreign Investment Review Board for investments up to A$1.094 billion (S$1.12 billion) in “non-sensitive" sectors.
The SAFTA will also make it easier for Singapore exports into Australia to qualify for tariff-free treatment under increased flexibility in rules of origin.
Regulatory barriers that impede trade in goods like wine and distilled spirits, cosmetics, medical devices and pharmaceutical products will also be reduced.
The length of stay and mobility of business persons - like intra-corporate transferees - from both countries will also be improved.
According to MTI, bilateral trade between the two countries reached S$18.2 billion in 2016. Australia was Singapore's 13th-largest trading partner in 2016 while Singapore was Australia's seventh-largest trading partner.
Singapore is also Australia's fifth-largest investor, having invested around S$100.8 billion in real estate, telecommunications, tourism and utilities sectors in the country.