EU-Singaporean trade agreement to go into effect By Henri Estramant

 Wednesday, 13 February 2019, Strasbourg, European Union: The European Parliament gave the green light to a landmark trade agreement with the Republic of Singapore that is set to remove nearly all customs duties between the two entities.

Following a majority vote in favour of the European Union-Singapore Free Trade Agreement (EUSFTA), the covenant can be ratified and entered into legal force. This is the very first comprehensive trade agreement with an ASEAN country, and thus a paradigm for any future accords with ASEAN member states.

The EUSFTA eliminates duties, shall allow up to 84 per cent of Singaporean exports to enter the EU duty-free once it comes into force. The latter encompasses Asian food products and electronics.Tariffs on remaining products such as selected meat and seafood produce, will be removed in the third to fifth years after the pact has been ratified.

Other benefits include having materials from ASEAN countries be deemed as originating from Singapore when incorporated into certain final products, enabling these items to quality for preferential tariff treatment as well.

There are over 10,000 active European companies in Singapore; all in all, the EU is Singapore’s third-largest trading partner. Multilateral trade between both parties amounted to about €53 billion (S$81 billion) in 2018.

In addition to the EUSFTA, two other agreements received majority support on Wednesday yet unlike the trade pact, they will need to be approved by regional and national legislative bodies of all member states before they can come into force. One of them is the EU-Singapore Investment Protection Agreement (IPA),  which shall replace 12 existing bilateral investment treaties between Singapore and various EU member states, encouraging investments and setting out rules giving investors protection. The other being the EU-Singapore Partnership and Cooperation Agreement, which provides a framework to deepen cooperation in key political areas from transport to science and technology.

The Republic of Singapore is by itself a gateway for EU firms to access other major economies such as China and India due to its competitive laws, security and high-living standards.

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