EU-SINGAPORE: COUNCIL ADOPTS DECISIONS TO SIGN TRADE AND INVESTMENT AGREEMENTS
On October 15, the Council adopted decisions on the signature of the following two agreements between the EU and Singapore:
- Free Trade Agreement
- Investment Protection Agreement
The EU and Singapore are expected to sign both agreements, as well as a partnership and cooperation agreement during the Asia-Europe Meeting summit (ASEM) on October 18 and 19 in Brussels.
The ASEM summit will bring together
- Heads of state and government from 51 European and Asian countries
- Representatives of the European Union
- The Secretary-General of the Association of Southeast Asian Nations (ASEAN)
The President of the European Council, Donald Tusk, will be the chair of the summit. The President of the European Commission, Jean-Claude Juncker, will also represent the EU at the summit.
The conversations will focus on the theme “Europe and Asia: Global Partners for Global Challenges".
Trade and investment agreements
The EU-Singapore Trade and Investment Agreements are the first bilateral trade and investment agreements concluded between the European Union and a Member State of the Association of Southeast Asian Nations (ASEAN).
Singapore is by far the EU's largest ASEAN partner, accounting for almost one third of EU-ASEAN trade in goods and services.
Bilateral trade in goods amounted € 53.3 billion in 2017, with the EU exporting € 33.16 billion, mainly cars and machinery, while importing € 20.14 billion, in particular chemicals, pharmaceuticals.
Before this agreement, almost all goods from the EU could already enter Singapore free of customs duties. The FTA will now eliminate the remaining tariffs within three to five years, depending on the product category. The FTA will also remove technical and non-tariff barriers by recognizing the EU's standards and safety tests in key areas, such as electronics, pharmaceuticals or car parts. For fisheries and processed agricultural products entering the EU, some tariffs will continue to be applied.
The Free Trade Agreement will lift restrictions in the service sector, where bilateral trade amounted € 44.4 billion in 2016. The EU is Singapore’s biggest trading partner in services, while over 10.000 EU companies use Singapore as a hub to serve the whole region. The EU-Singapore trade deal is one of the first 'new generation' bilateral agreements. On top of the classical removal of customs duties and non-tariff barriers for trade in goods and services, it contains important provisions on intellectual property protection, investment liberalization, public procurement, competition and sustainable development.
The Investment Protection Agreement between the EU and Singapore will further improve the investment climate and offer more certainty to investors, while safeguarding the EU's and Singapore's rights to regulate and pursue public policy objectives such as the protection of public health, safety and the environment. This agreement will replace the 12 existing Bilateral Investment Treaties between Singapore and EU Member States.
The EU and Singapore launched trade and investment negotiations in 2010. Talks were concluded in 2014. Following an opinion of the European Court of Justice in May 2017, the Commission proposed two separate agreements in April 2018:
- a Free Trade Agreement which contains areas of exclusive EU competence and thus only requires the Council's approval and the European Parliament's consent before it can enter into force. Read more about the EU-Singapore Free Trade Agreement
- an Investment Protection Agreement which, due to its shared competence nature, will also have to go through the relevant national ratification procedures in all member states before it can enter into force. The time horizon for implementation of this agreement is therefore much longer. Read more about the EU-Singapore Investment Protection Agreement