As per data released by “Singapore Department of Statistics”, Singapore's FDI stock has more than tripled in the time period from 1995 to 2005. Europe, North America and Asia were the major FDI contributors to Singapore. These regions contributed to 82% of the Singaporean FDI stock in 2005.
Europe gradually gained in importance as Singapore's leading foreign investor in the 1995 to 2005 time period. Europe's share of investment in this period rose from 31% to 43%. Absolute amount of foreign investments from Asia and North America in Singapore increased during the same reference period. However, their shares recorded a decline. Asia recorded a decline in its share from 33% to 24%. For North America the decline was from 21% to 15%.
In the reference period, United Kingdom, Switzerland and Netherlands were some of the major foreign investors from Europe to invest in Singapore. Taken together, these three nations accounted for over 77% of European FDI stock flow into Singapore.
United Kingdom's share of FDI inflow to Singapore rose from 34% in 1995 to 37% in the year 2005. The comparable figures for Netherlands were 16% and 24% respectively in the same reference period. Switzerland's FDI inflow figures to Singapore declined from 25% in the year 1995 to 16% in the year 2005.
Two other European nations engaged in FDI activity in Singapore were Norway and Germany. Norway's share of foreign investment in Singapore rose from 0.7% in 1995 to 5.9% in the year 2005. The comparable figures for Germany were 6.7% and 5.6% respectively. Germany's investment interests in Singapore suffered a decline from 1995 to 2005.
Asia's FDI flow for Singapore increased more than twice from 1995 to 2005. In 2005 Japan was the largest Asian foreign investor in Singapore. Japan's share of total Asian FDI stock for Singapore for the period 1995 to 2005 ranged from 56% to 60%.
Malaysia and Taiwan held the second and third positions with respect to size of FDI stock investment from Asian countries in Singapore in 2005. Taiwan's share of FDI from Asia to Singapore rose from 3.1% to 9.7% in the period from 1995 to 2005. In the same reference period Malaysia's share fell from 13% to 9.7%.
In 1995, Hong Kong held the distinction of being the second largest foreign direct investor from Asia in Singapore.
Foreign direct investment in Singapore from North America in 2005 was more than double the comparable figure for 1995.
Most of the FDI flows into Singapore from 1995 to 2005 went to some major sectors of the economy. They are stated below:
Financial services and Insurance services sector
Hotels and restaurants
Whole sale trade and retail trade sectorThese above mentioned sectors of the Singaporean economy accounted for nearly 90% of Singapore's FDI stock for the year 2005.
As per 2007 data, foreign investments measured in '$m' in Singapore's manufacturing sector amounted to 14,279.2. Investment measured in $ billion for the Singaporean economy as a whole stood at 23.1 for the year 2007.
The number of investment projects in Singapore funded by FDI flow in 2007 was 239. The number of jobs generated out of it was 35,441.
The ASEAN Economic Community, planned to come into effect in 2015, is expected to liberalise goods, capital and skilled labour flows in the ASEAN region. While there has been considerable progress in the area of trade integration, financial integration still lags behind. The ASEAN Banking Integration Framework, which aims to liberalise the banking market by 2020, could help pave the way for further integration and the entry of ASEAN banks into regional banking markets.
Greater banking integration in ASEAN will benefit the region.
Nouriel Roubini, a.k.a. “Doctor Doom”, is chairman of Roubini Global Economics and professor of economics at New York University’s Stern School of Business. Roubini has been consistently cited as one of the world’s top global thinkers. This year, he was voted as the most influential economist in the world by Forbes magazine.
CEO and co-CIO of PIMCO. Served as President and CEO of the Harvard Management Company for 2 years, while also working at the IMF for 15 years. In 2008, his book "When Markets Collide", won the Financial Times award for Business Book of The Year in addition to being named as the one of the best business books of all time by The Independent.
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James W. Harpel Professor of Capital Formation and Growth at the John F. Kennedy School of Government in Harvard University. Director of Program in International Finance and Macroeconomics at the National Bureau of Economic Research.