Trade and Industry Minister Chan Chun Sing has urged African companies to look to Singapore to access the rest of Asia.
Mr Chan said this in his opening address to attendees of the Africa-Singapore Business Forum 2018 on Tuesday (Aug 28).
Over 500 people from over 35 countries are expected to participate in the two-day forum which ends on Wednesday.
In his speech, Mr Chan outlined the importance of promoting economic integration and cooperation against a backdrop of rising trade tensions and protectionism.
“I would like to encourage African businesses to engage Singapore as your partner in Asia, see Singapore not just for our domestic market, but see us also as a platform, as a launchpad for your business opportunities in Southeast Asia and beyond,” said Mr Chan.
He added that Singapore’s “strong connections at the government and business level makes it a good base from which African companies can explore and access Asia.”
According to Singstat, foreign direct investment from Africa into Singapore amounted to S$27.4 billion in 2016.
Over 60 Singaporean firms operate in Africa, ranging from food manufacturing to digital payment services, and Enterprise Singapore – the government agency which helps businesses internationalise – is working to increase that number. It said a main challenge was managing risk.
Global Markets Director, Middle East & Africa of Enterprise Singapore G Jayakrishnan said the agency works with people on the ground, validate African counterparties, as well as encourage companies to take up political risk insurance.
“We have programmes for (that), there are ways to mitigate it, and get around the risk element of Africa,” said Mr Jayakrishnan.
In 2017, trade between Singapore and Africa amounted to S$9.78 billion according to data from Enterprise Singapore, while Singapore investment into Africa reached S$18.5 billion in 2016, making the republic its 7th largest trading partner.
According to the United Nations, Singapore is Africa’s largest Southeast Asian trading partner.
Enterprise Singapore highlighted two growth engines in the areas of deepening digital capabilities and addressing Africa’s manufacturing needs.
According to a McKinsey report, Africa’s consumer spending is expected to reach US$2.1 trillion (S$2.86 trillion) by 2025, and that its e-commerce purchases are projected to hit US$75 billion (S$102 billion) in the same year.
“Africa’s rapid growth and thriving digital economy offers rich opportunities for Singapore companies seeking higher growth and market diversification,” said CEO of Enterprise Singapore, Mr Png Cheong Boon.
At the event, an Avoidance of Double Taxation Agreement (DTA) between Singapore and Gabon was signed, bringing the list of DTAs between Singapore and Africa to 13. A total of five memoranda of understandings in areas of digital, infrastructure and business services were inked between African and Singapore companies.
One is a tie-up is between media analytics firm Graymatics, and IT company Crescentech to provide security and surveillance solutions in Kenya, South Africa and Nigeria.
President and CEO of Graymatics Abhijit Shanbhag said Enterprise Singapore has played a big role in the collaboration.
“Enterprise Singapore had organised a mission within Africa which we participated in within Kenya and within that, that was actually the start of a number of business engagements that we had in Africa,” said Mr Shanbhag.
Director of Strategy & Innovation for Crescentech, Dr Percy Opio, said “Enterprise Singapore is very specific about who they want us to partner with, they want us to partner with organisations that have relevant solutions for our market.”
“We believe that this process will not only provide solutions in Kenya, but Graymatics will also empower us,” he said.