Why Singapore
Singapore’s size and population may be small, but its connectivity, favourable business environment and highly skilled workforce have transformed it into a global hub for trade, finance and investment. It accounts for most global foreign investment into Southeast Asia, is an established regional headquarters for thousands of multinational firms and consistently ranks as one of the world’s best places to do business. Singapore's adoption of digital technologies and sustainability solutions is positioning it for strong future growth, presenting a range of new opportunities for businesses looking to engage with one of Southeast Asia’s most dynamic economies.
Economy overview
Ranked as the world’s best place to do business in 2024, Singapore is core to the functioning of many global value chains. In 2024, 41 million containers passed through the city-state , making it the second busiest port in the world, behind Shanghai. In value terms, nearly 58 per cent of these goods – ranging from raw materials to finished products – were reexported to other countries in Asia and outside the region.
Singapore plays a similarly important role in Southeast Asia’s capital flows. In 2024, it made up nearly seventy percent of total FDI inflow into Southeast Asia and accounted for more than half of all mergers and acquisitions in the region. Its role as a financial centre is unrivalled in Southeast Asia, ranking 4th in the Global Financial Centre Index.
Widely viewed as among the most influential members of ASEAN and a driving force behind the bloc’s major trade agreements, Singapore played a key role in the development of the Regional Comprehensive Economic Partnership (RCEP), the ASEAN-Australia- New Zealand Free Trade Agreement (AANZFTA) and the Comprehensive and Progressive Agreement for Trans- Pacific Partnership (CPTPP). Its promotion of ASEAN’s interests in an environment of strategic competition has enabled solid relationships with both the US and China.
Singapore is Australia’s largest trade and investment partner in Southeast Asia. In 2024, two-way trade totalled AUD 47.4 billion. Since completing the Singapore-Australia Free Trade Agreement (SAFTA) in 2003, the two countries have signed the Digital Economy Agreement in 2020 and the Green Economy Agreement in 2022. The Australian Government’s Southeast Asia Economic Strategy to 2040 has identified Singapore as a key financial and commercial hub for regional trade and investment. More information is available in Section 5.1 and from the Department of Foreign Affairs and Trade’s Singapore Country Brief.
Singapore’s favourable business environment, per capita spending power and gateway location to the wider region present a range of opportunities for Australian businesses. For those contemplating trade and investment with Singapore itself, or as a base for expansion into the vibrant economies of Southeast Asia, it is an ideal market to start.
Comparing key indicators: Singapore and Australia
Along with Hong Kong, South Korea and Taiwan, Singapore is among the group of fast-growing Asian economies that implemented policies in the 1960s to expand exports and which have now reached upper income status. Singapore still relies on trade for economic growth, but the nation’s strength in logistics and trade facilitation is more important than manufacturing for export. Services now account for 73 per cent of Singapore’s annual GDP.
Singapore’s size, lack of natural resources and reliance on global trade and financial flows make the nation vulnerable to external shocks. During the pandemic, Singapore’s global trade and GDP fell further than the world average, but the upside of its exposure is that it recovered faster (Figure 1). Singapore is forecast to return to a stable trajectory of GDP growth, estimated to be between 2 to 2.5 per cent per year between 2025 and 2030.
Figure 1: Real GDP Growth – Singapore and world average (2016 – 2026f), %
Sectoral snapshots
Singapore’s strong economic performance, demographic and consumer trends, and decarbonisation efforts offer significant opportunities for Australian trade and investment, particularly in the nation’s priority sectors for economic growth. These include infrastructure and logistics, the digital economy, sustainability, and innovation and R&D. This section highlights the key business sectors for Australian companies.
Green economy
As Singapore’s green economy develops into a critical industry, new opportunities are emerging for Australian businesses. The Singapore Green Plan 2030 aims to help industries harness sustainability to drive new growth, with Australian businesses eligible for government incentives to develop and scale green technologies. The Singapore-Australia Green Economy Agreement is helping to grow two-way trade while reducing emissions, facilitating the development of a green shipping corridor, fostering business collaboration and increasing the interoperability of sustainability standards. Singapore has committed to net-zero by 2050 and aims to power 50 per cent of its domestic electricity with hydrogen. Austrade identifies renewable energy solutions as a key export opportunity for Australian businesses.
Food and agribusiness
Singapore imports over 90 per cent of its food and agricultural products, providing a long-term opportunity for Australian food and agricultural exporters. While the government is strictly committed to food safety, Singapore is also a global leader in non-traditional ‘novel foods’, which provides opportunities for trade and investment in innovative products and technological solutions. Austrade identifies Singapore as a strategic market that values premium products and supply chain resilience. Key Australian exports include dairy, horticulture, meat and livestock, packaged foods, seafood, and wine and beverages.
Health and medical
In 2023, the Singaporean government launched a national primary care plan and increased investment in training across the medical sector. By 2030, nearly 25 per cent of Singaporeans will be over 65 and national health expenditure is forecast to reach AUD 67 billion, presenting an opportunity for healthcare and health-related service exports. Singapore is committed to providing high-quality and affordable care to its citizens by balancing innovative medical technologies with evidence-based cost considerations. In line with this priority, healthcare facilities, including hospitals, aged care and clinics, are being expanded or redeveloped over the next decade. Singapore is one of Austrade’s priority markets for biotech and digital health innovations.
Infrastructure, transportation and cities
Singapore is emerging as one of the world’s most sophisticated smart cities, presenting infrastructure, transport and urban planning opportunities for Australian businesses. The government’s Smart Nation mandate includes plans for remote sensors to improve sustainability and public safety, more efficient public transit and innovative applications for the Internet of Things (IoT). Its Digital Connectivity Blueprint aims to deliver soft and hard data infrastructure to maximise security, sustainability and capacity. Growth in the logistics and trade facilitation sectors are expected to continue as the government works to strengthen Singapore’s role in global supply chains. Circular economy, sustainable cities and enabling services are among Austrade’s proactive sectors for engagement, in addition to airport solutions, roads, rail, ports and logistics and sustainable building solutions.
Technology
Rapid digitisation and the growth of e-commerce in Singapore present opportunities for Australian businesses across software, digital content, telecommunications and hardware. Consistently ranked among the world’s top markets for digital
competitiveness, Singapore’s focus on attracting and developing talent in technology has transformed it into a global technology hub. The government’s Smart Nation mandate defines strategic national priority areas for technological development and provides a number of easy-to-access services for businesses to improve development efficiency. In line with Singapore’s commitment to developing its digital economy, Austrade’s Landing Pad programme and business matching engagements focus on key critical and enabling technologies, including autonomous systems, quantum, cleantech, enterprise and SaaS, artificial intelligence, advanced ICT and fintech.
Professional and financial services
Singapore’s highly skilled workforce and pro-business environment has cemented its role as a leading global professional and financial services hub. Over the last decade, assets under management in Singapore have grown by 12 per cent annually – a trend forecast to continue. The Monetary Authority of Singapore has identified fintech as a priority area for growth, providing Australian businesses an opportunity to enter the growing market for new financial products and services. The government is also prioritising the development of green financial products and investment funds to speed up the energy transition. While regulatory barriers can make market entry challenging, services sector growth and the energy transition offer opportunities for Australian professional service firms to provide financial, engineering, legal, architectural and consulting services.