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New Zealand’s links with Singapore are among its longest-established and closest in Asia. The two countries both have open economies and often take similar views internationally and regionally on trade issues. Singapore provides New Zealand with valuable insights into ASEAN thinking and processes.
The bilateral relationship dates back to well before Singaporean independence from Malaysia in 1965. During the Second World War, New Zealand fliers played a notable role in the air defence of Singapore. Post war, New Zealand stationed an infantry battalion and air units in Singapore between 1969 and 1989. Strong defence links have continued in the years since.
During the 1980s, Singapore’s economic boom helped drive an important bilateral trade relationship. Today, Singapore is New Zealand’s seventh-largest merchandise trading partner and a base for New Zealand businesses operating throughout South East Asia.
The Association of South East Asian Nations (ASEAN), of which Singapore is a founding member, is a centrepiece of Singapore’s foreign policy. New Zealand is linked closely to ASEAN as a Dialogue Partner. Singapore, with its close historical ties to New Zealand, has been a key “window” for us into ASEAN processes and planning, and often shares similar views to New Zealand’s on regional initiatives.
Singapore and New Zealand are members of, and work together closely in, regional and wider groupings including APEC (of which Singapore was the 2009 host), the security-focused ASEAN Regional Forum (ARF) and the East Asia Summit (EAS).
Singapore is a strong supporter of international law, particularly the sanctity of national sovereignty, and plays an active role in both the United Nations and the Commonwealth.
The first major economic agreement between New Zealand and Singapore was the Agreement on a Closer Economic Partnership (ANZSCEP), New Zealand’s second CEP after CER with Australia. This entered into force on 1 January 2001 and remains one of New Zealand’s most comprehensive international economic arrangements.
The CEP became the foundation for the 2005 “P4” trade agreement between New Zealand, Singapore, Brunei and Chile that is now in the process of evolving into the potentially much larger Trans-Pacific Strategic Economic Partnership (TPP) Agreement.
In parallel to the TPP, Singapore, New Zealand, Chile and Brunei have negotiated a binding Environment Cooperation Agreement and a binding Labour Cooperation Memorandum of Understanding.
Singapore was a central player in the development and conclusion of the Australia/New Zealand/ASEAN Free Trade Agreement (AANZFTA) that was agreed in September 2008 and entered into force on 1 January 2010. This agreement is likely to be worth around $50 million in tariff savings per year to New Zealand.
As an open and heavily export-dependent economy, Singapore was particularly hard-hit by the 2008-09 downturn, but has recovered rapidly. Its GDP grew by 14.5 percent in 2010, following a contraction of 2 percent in 2009. Its economic growth moderated in 2011 to 4.9 percent.
Singapore’s economic policies are aimed at maintaining Singapore’s role as a major trading centre in Asia. Its fiscal policy is designed to ensure that its economy continues to move up the value-added chain. A new national economic blueprint focuses on gearing the economy towards inclusive growth for Singapore’s citizens, developing local small and medium enterprises, positioning the country as a global city and improving productivity.
In line with Singapore’s push to be a premier research hub in Asia, public expenditure on research and development is scheduled to increase to 3.5 percent of GDP. Singapore has also unveiled a S $1 billion ‘green plan’ to be a key player in the fast-growing environmental technology and urban solutions industry.
Singapore is currently Zealand’s seventh-largest bilateral trading partner. Total two-way trade between Singapore and New Zealand in the December 2011 year (provisional) was NZ $2.91 billion, up significantly on the $2.36 billion of the December 2010 year.
The balance of bilateral trade has long been strongly in Singapore’s favour – and in 2011 grew to almost 3:1. The latest provisional New Zealand figures, for the December 2011 year, show New Zealand exports at $752million and imports at $2164 million.
New Zealand exports to Singapore are currently focused on crude oil, milk powder, boats, butter and beef, while leading imports include refined oil, computers, polymers and paper.
Figures for leading New Zealand imports and exports (and changes from the previous calendar year figures) are given at the end of this paper.
Increasing New Zealand effort is going into promoting innovation and research-based industry in which there are good synergies with Singaporean capital and global business connections. Biotechnology, ‘clean’ technology, ICT and the creative industries show particular promise. Singapore has made vast investments in implementing state-of-the art science development and commercialisation programmes.
Education cooperation is also an area of considerable potential, particularly in the early childhood, physical education and creative skills areas.
Singapore is an important source of investment for New Zealand. The stock of Singaporean foreign direct investment in New Zealand at March 2011 was NZ$2 billion up from NZ$1581 million in March 2010.
A Work Exchange Programme created in 1999 enables New Zealand and Singaporean tertiary students and recent graduates to work in each other’s country for up to six months.
In August 2009, New Zealand and Singapore signed a Double Taxation Agreement that replaced an outdated 1973 agreement.
New Zealand and Singapore are parties to a 2001 Multilateral Agreement on the Liberalisation of Air Transportation (MALIAT) and the MALIAT Protocol (an “open skies” agreement).
An Audio-visual Co-production Agreement was signed in July 2004 to strengthen co-operation between the film industries of both countries.
Defence links, which date back to the Second World War, form a significant part of the New Zealand-Singapore relationship. Arrangements for training assistance and other cooperation were formalised in a bilateral agreement concluded between the two Governments in 1971 in parallel with the establishment of the Five Power Defence Arrangements (FPDA).
New Zealand takes part in a many bilateral and multilateral naval, air and army exercises with Singapore. In terms of overall activity, Singapore is New Zealand’s second-largest defence partner in the Asia-Pacific after Australia.
The maturity of the Singapore-New Zealand defence relationship and a history of defence cooperation yield benefits for both countries. Singaporean forces have operated with the New Zealand Defence Force in Afghanistan and Timor-Leste. The two armed forces exercise and train together regularly.
New Zealand signed a Defence Cooperation Arrangement with Singapore in May 2009. This formalises the existing close defence ties between the two countries.
In 2010 New Zealand became part of the ASEAN Defence Ministers’ Meeting (ADMM) process, of which Singapore is a key member. In February 2011, SAF troops exercising in the South Island took part in search and rescue efforts in the immediate aftermath of the Christchurch earthquake, symbolising excellent bilateral ties.
The Five Power Defence Arrangements (FPDA) is a joint defence arrangement between Malaysia, Singapore, Australia, New Zealand and the United Kingdom.
In the year ended December 2011, some 38,680 Singaporean residents visited New Zealand, a 27 percent increase over the previous calendar year.
Recent Singaporean high-level visits to New Zealand
Official name: The Republic of Singapore
Land area: 712.4 sq km
Population: 5.08 million
Capital city: Singapore
Religion: Buddhism, Islam, Christianity, Taoism, Hinduism
Language: Malay, Chinese (Mandarin), Tamil and English are the official languages. Malay is the national language and English the administrative language.
Currency: Singapore dollar
Exchange rate: S $1 = NZ $$0.99 [June 2012]
Political system: Republic, with a parliamentary system of government
National government: People’s Action Party (holds 81 seats out of 87 possible seats in parliament)
National legislature: Comprises the President and a unicameral Parliament
Last election: 7 May 2011
Next election due: by Feb 2016
Head of State: President Tony Tan Keng Yam
Head of Government: Prime Minister Lee Hsien Loong
Key ministers: Mr Teo Chee Hean - Deputy Prime Minister, Co-ordinating Minister for National Security Home Affairs Minister; Mr Tharman Shanmugaratnam - Deputy Prime Minister, Finance Minister, Manpower Minister; Mr K Shanmugam - Foreign Affairs Minister, Law Minister; Dr Ng Eng Hen - Defence Minister; Mr Heng Swee Keat - Education Minister; Dr Yaacob Ibrahim - Minister of Information, Communications and the Arts; Mr Khaw Boon Wan - National Development Minister; Mr Lim Hng Kiang - Trade and Industry Minister; Dr Vivian Balakrishnan - Environment and Water Resources Minister; Mr Gan Kim Yong - Health Minister.
There are also nine Nominated MPs (NMPs), who are not connected to any political parties.
Main political parties: People’s Action Party (PAP), Workers’ Party (WP), Singapore Democratic Alliance (SDA), Singapore Democratic Party (SDP), National Solidarity Party (NSP) and Reform Party (RP).
GDP: (2012)S $342b
GDP per capita (PPP): S $61,355
Real GDP growth: 3.1% (2012)
Exports(2012): S $534 bn
Imports(2012): S $496 bn
Inflation (2011): 5.2%
Statistics New Zealand figures
NZ exports to Singapore
(year to December 2011)
NZ$751 million (up 1.6% from NZ$739 million in December 2010 year)*
Main exports ($NZ year to December 2011)
$233m (-6.5% on December 2010 year)
NZ imports from Singapore
($NZ year to December 2011)
NZ $2163 million (up 33% from $1622 million in December 10 year)
Main imports (year to December 2011)
$1538m (+46% on December 2010 year)
*New Zealand external trade statistics are taken from data supplied by Statistics New Zealand. Due to differing collection methodologies between the respective statistics agencies in New Zealand and Singapore, Singaporean statistics for the same period differ.
The Safe Travel [external link] website provides a travel advisory for travellers to Singapore.