Trade Policy – 2016Introduction :-Singapore is a small and open economy, which is highly dependent on trade. Singapore's domestic and foreign trade policies are therefore closely intertwined. During the period under review, Singapore's domestic and foreign trade policies focused on four key priorities: enhancing productivity and innovation-led growth through economic restructuring; supporting the rules-based multilateral trading system to ensure a predictable and fair trading environment; promoting trade liberalisation to create opportunities for all Singapore-based companies; and modernising Singapore's domestic regulatory regime with a view to facilitate trade.
Navigating A Challenging Economic Environment :-
Trade contributes significantly to the Singapore economy. During the period under review, Singapore's trade to gross domestic product (GDP) ratio averaged around 368%. Trade accounted for approximately 60% of Singapore's GDP in value-added terms and half of employment in the same period.
The challenging global economic environment has had an impact on Singapore's economic performance. Sluggish global demand and sustained low oil prices have adversely affected significant sectors of the economy, such as the marine and offshore sector. Singapore's resource constraints in land, manpower and energy pose additional challenges to our efforts in sustaining economic growth. In 2015, the economy grew at a moderate pace of 2.0% compared to an average annual growth of 3.9% between 2012 and 2014.
The manufacturing sector recorded the weakest performance, contracting by 5.2% in 2015. This was a reversal from the average annual growth rate of 1.6% from 2012 to 2014. With the exception of the chemicals sector, all manufacturing sectors experienced declines in output in 2015. Growth in the construction sector was 2.5%, compared to an average annual growth rate of 6.9% from 2012 to 2014. This was attributed to a slowdown in private sector construction activities.
In contrast, the services sector expanded by 3.4% in 2015, a reduction from the average annual growth rate of 4.8% from 2012 to 2014. The wholesale and retail trade and the finance and insurance sectors registered the strongest growth. Notably, the wholesale and retail trade sector expanded by 6.1%, improving from the average annual growth of 4.0% from 2012 to 2014. Meanwhile, the finance and insurance sector grew by 5.3% – a significant fall from the average annual growth rate of 9.7% between 2012 and 2014.