Located in the centre of South East Asia and with a population of 5.5 million people, Singapore has established itself as a leading global commodities hub. What does Singapore offer global trading organisations?
Ease of conducting business
For the last eight years Singapore has been recognised by the World Bank as the world's easiest place to conduct business. This result takes into account its political stability, freedom of trade, regulatory efficiency as well as one of Asia's best intellectual property rights regimes.
At the heart of Asia's trading routes
Geographically, Singapore is at the heart of Asia's trading routes. It is the world's leading bunkering port and second largest container port. Approximately 58 licensed bunker traders ( 1) supply 42 million metric tons per year. This is more than four times that of Rotterdam, Europe's largest supplier. Its location also means it is in the same time zone as China and Western Australia, and within 2.5 hours of India and Sydney. This benefits those based in Singapore, who are able to conduct APAC trade within convenient times for a large part of the global population.
Home to global trading talent
Singapore is home to 14,000 people who operate across the commodities sector, providing some of the world's major trading and commodities services talent. It holds some of the world's largest commodity trading companies, who generate more than USD 1 trillion in annual turnover. This includes 80% of the world's top metals & mining and oil & gas companies. Of the 400 trading firms in Singapore, 35% of them place one or more C-level positions in Singapore (2).
Promoting international trade
International Enterprise (IE) Singapore is a government body established with the aim of promoting international trade and partnering Singapore companies in going global. IE Singapore work with commodities traders to establish their global or Asian base in Singapore, and at the same time partners service providers (including lawyers) to create a vibrant and conducive trading environment in Singapore.
A recent example was how IE Singapore worked together with ISTA to create a Singapore based branch of the association to support companies and persons engaged in the trade of and service to the steel and steel-making raw materials sector. The establishment of ISTA's Singapore based branch was supported by Clyde & Co.
Future outlook
Recent reports suggest that Singapore is likely to be affected by the recent end to the supercycle and bearish markets seen across most commodities. However, with its extensive network of players along the commodity supply chain, logistics, financing, specialised legal service and other ancillary services, Singapore is likely to remain an effective marketplace for traders to structure deals. With Asia forecasted to account for 60% of the world's increase in global trade until 2020, it would seem that Singapore is best placed to weather the storm.
Footnotes
1. Maritime and Port Authority of Singapore
2. Unless otherwise specified, statistics are taken from International Enterprise Singapore website
Singapore: A Leading Commodities Trading Hub
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