Singapore companies evaluate alternatives for their recovery

Singapore companies evaluate new economic alternatives and technologies to recover from the economic impact caused by the pandemic.

Singapore companies are looking for new sources of income and are evaluating the incorporation of new technologies adapted to their services and products.

This after stating that most will need between 1 or 2 years to recover from the losses caused by the spread of Covid-19.

According to a survey carried out in the city-state, 60 percent of the consulted companies confirmed that this is the necessary time to regain their stability similar prior to the pandemic.

According to the study published by the Singapore Chinese Chamber of Commerce and Industry (SCCCI), 80 percent of the firms surveyed stated that their income was affected, while 76 percent saw their profits decrease.

Respondents highlighted that they are currently facing challenges related to financing and cash flows.

In the same way, they pointed out the increase in commercial costs, the economic conditions of the world is another of the scenarios they currently face.

The survey was performed in June and July among more than 1,000 companies, 95 percent of them small and medium-sized companies.

Job Support Scheme will be extended to support companies

In the midst of this panorama, the Singaporean government announced the extension of the Job Support Scheme to provide help to workers and companies affected by Covid-19.

This measure was recently announced by Singapore’s Deputy Prime Minister and Finance Minister Heng Swee Keat, who also stated that $ 5.84 billion were approved for the initiative.

Among the measures described include continuous support for jobs to increase the number of local workers during the next six months.

The call for the Virtual Trade Mission to Indonesia and Singapore is announce

In the framework of the Enterprise Europe Network, they announce the third call of the Multisectoral Virtual Trade Mission to Indonesia and Singapore.

The Ministry of Innovation, Industry, Transport and Commerce and the Cantabria Chamber of Commerce announced the third call for the 2020 International Promotion Action Plan.

Within the framework of this call, a Virtual Agenda Service – Multisectoral Virtual Trade Mission to Indonesia and Singapore is included.

This call, which takes place within the framework of the Enterprise Europe Network, has as final objective the realization of multisectoral virtual agendas and meetings with potential clients or importers from Indonesia and Singapore.

This activity will count with the collaboration of the Economic and Commercial Offices of Spain that will be in charge of the individual agendas in which the participating companies will work.

The meetings will be virtual and will be adapted to the profile and needs of the participating countries.

Each company will have the opportunity to meet virtually with potential clients and organizations from other countries, these established prior to a participation form in the meeting where they determine their profile and interests.

About Enterprise Europe Network

  • Enterprise Europe Network helps companies to innovate and grow internationally.
  • It is the world’s largest support network for small and medium-sized enterprises (SMEs) with international ambitions.
  • The network is active in more than 60 countries worldwide.
  • It brings together 3,000 experts from more than 600 member organizations, all recognized for their excellence in business support.

Singapore in Context

Singapore is a city-state with a total population of 5.6 million inhabitants.

It has legal certainty similar to that of any developed western country and has positioned itself in recent years as a hub for business, commercial and technological operations throughout the Asia Pacific.

With a per capita income of more than 60,000 US dollars, the economy has been growing positively since the last crisis (2010) at an average of 3.5%.

However, recent recorded a downturn attributed to the Covid-19 pandemic.

MAS urges banks to properly manage their capital

The Monetary Authority of Singapore called on national banks to moderate their dividends, from fiscal year 2020, to 60 percent to increase their lending capacity.

The Monetary Authority of Singapore urged local banks to limit their dividends from fiscal year 2020 to 60 percent.

They assured that this measure aims to allow national banks to maintain their capital and increase their lending capacity to companies or individuals.

In its statement, the Monetary Authority of Singapore pointed out that the world faces an uncertain scenario and that it is necessary to guarantee sustained loans in the city-state.

Banks will resist risks

It highlighted that in previous years, national financial institutions accumulated a large capital that will allow them to resist the risks that are coming due to the economic crisis cause by the pandemic.

“We are fortunate that banks in Singapore entered the COVID-19 pandemic with strong capital positions” said Ravi Menon, Managing Director of MAS.

In addition to this, the Managing Director also called on all the national banks to properly maintain and manage their capital.

"Given the uncertainties that lie ahead and that global economies still show no signs of recovery, it would be prudent for local banks to reserve a larger share of profits during this period," he said.

The MAS assured that this initiative will strengthen the capacity of all local financial entities to continue supporting the credit needs of companies and consumers.

As well as it considers that it will help to absorb the economic impacts in the event that a more adverse scenario materializes.

Singapore companies and adoption of biosecurity measures

One of the biggest challenges that the Singapore government is facing is reviving the economy in the middle of the covid-19 outbreak.

Currently they have taken a series of biosecurity measures that must be implemented in the public sector as in private companies.

In the following, we will discuss some of those biosafety strategies applied in Singapore and what are the mechanisms established for the business sector to join these measures.

Measures of the safe transition phase

Since July 1, the government announced new measures to continue the plan to gradually reopen commercial premises, companies and other workplaces.

Within the safe transition plan, the health sectors, tour operators, restaurants, religious centers, among others, are the main ones involved.

To this, stakeholders made a commitment to stick to sector-specific hygiene and sanitation checklists ranging from:

  • Safe distance.
  • Good personal hygiene practice
  • Wearing face masks
  • Frequent hand washing
  • The use of hand sanitizers.
  • Know and spread the measures adopted
  • Have hygiene and sanitation certifications.

Importance of Biosafety protocols

Right now the world is facing a pandemic that has affected the global economy, faithful compliance by sectors can help mitigate the effects of the virus.

Companies are the perfect setting for the spread of Covid-19, due to crowds in workplaces.

Consequently, it is the duty and responsibility of the owners to ensure proper compliance of the biosafety protocols established by the Singapore government.

In order to avoid further exposure of workers to the virus and other infections.

The International Labor Organization reaffirms these principles as it considers that many workers go to their jobs.

“Prevention and control measures must be a priority to protect the world of work from exposure to this biological risk and avoid new infections,” says the agency.

Currently, Singapore has implemented a gradual revival of the economy in order to guarantee health measures for public and private workers.

Migrant worker outbreak

Singapore was praised by international health experts for its initial response to the virus in the first months of the pandemic.

However, an outbreak among migrant workers living in dormitories, made the city-state become one of the most infected countries in Asia at the moment with more than 50 thousand confirmed cases.

Customs Procedures in Singapore

Every time a company purchases an imported product it must fulfill with the regulations established by the Customs Regime of that country, in this sense we will talk about the customs procedures in Singapore in this article.

Firstly, it is important to know that Singapore does not belong to any customs union. Rather, it’s a member of the Asia-Pacific Economic Cooperation Forum (APEC) and applies the Harmonized Customs System.

According to the World Trade Organization, it is defined as the nomenclature based on a classification of goods according to a 6-digit code system accepted by all participating countries. They may establish their own sub-classifications with more than 6 digits for tariff or other purposes.

It consists on a six-digit combination that identifies the products based on their characteristics.

More than 200 countries and 98% of global trade use this product nomenclature system known as the Harmonized System which is regulated by the World Customs Organization.

Therefore, one of the points that any PYME or company should take into account when trying to trade their products in the international market is that it’s not enough to know the current name of the goods that they sell, but also it will be necessary to indicate the “code” That identifies it.

This “code” will appear frequently in the export and import documentation, and will be essential in determining the applicable tariffs for each product.

The legal regulations that rule the entire area of customs procedures in Singapore are:

  • Customs law
  • Goods and Services Tax Law

Both laws are responsible for regulating all merchandise that enters the country through import.

However, the import process in Singapore is quite open, most products can enter the country without further restriction, exceptions include products with chewing gum and weapons.

Regarding the tariffs and taxes corresponding to the import activity, the country is free of taxes except for products such as automobiles, gasoline, tobacco and alcohol.

However, every good that enters the country through importation is submit to the laws, and requires a customs permit to consider the activity and order the payment of corresponding taxes.

In Singapore, there is a licensing system that is required for 6% of total imports, related to fresh fruit and vegetables, plants, meat, animals, medicines, diffusion products (automatic licenses), and also a series of products that may represent a risk to health or to the State (without automatic licenses).

These licenses are issued by the Singapore International Company, another body that can also take part is the Ministry of Health.


The international trade terms: The export products

For Shoshan Trading it is very important that our users, clients and partners know the terms on the export of products as an approach to international trade.

The information about the product export process allows the investor to have a better overview when making decisions.

Exports are a fundamental part of the business internationalization of companies, since it allows them to take their products to any part of the world, through this activity companies can enhance their business, market and expand their brand.

What is the export of products?

They are the set of goods and services sold by a country in foreign territory for its use. Along with imports, they are an essential accounting tool for each country.

These operations are regulated by a series of controls and legal provisions that act as a contextual framework for commercial relations between territories.

The export of products can be carried out by different routes according to the distance and country in which it is located and is destined: its transport can be for land, truck, car, sea or a plane.

Benefits of exporting products:

• It promotes the production process of the country of origin of the merchandise.

• Provides an opportunity for business expansion globally.

• It favors the offer of services and products to a greater number of users.

• It driving the increase in income and customer portfolios of companies, among others.

What is the entity in charge of executing the product export operation?

The physical entity and governmental body mainly in charge of this procedure is customs, so a merchandise must leave a certain customs office in a certain nation or economic block and must enter a similar one in the receiving country.

It is important to mention that these transactions between several states usually present a significant degree of difficulty at the legal and fiscal level, since they vary significantly from one country to another.

The 8 countries with the highest volume of exports worldwide are:

China, the United States, Germany, Japan, France, The Netherlands, South Korea and Italy.

There are several aspects that must be evaluated before exporting the product, for example:

• Know the customs laws of the countries where you will export.

• Accurate information on packaging, labeling, documentation and health.

• Have the means of transport to carry out exports.

• Maintain alliances and agreements with other companies in the destination country.

Whether it is a company or a natural person, everyone must support a series of requirements to export anywhere.

It should also be taken into account that, the procedure for the export of products varies according to the region or country to which it is destined, it is not the same to export to a member country of the European Union as to an Asian country.

However, there are a number of requirements that hardly vary:

Pro-forma invoice: it is a provisional invoice, with data on the quantity of merchandise, insurance, transport costs of the operation.

Commercial invoice: It is the document where all the information of the sale is.

Packling list: corresponds to the list of products of the transport companies that provide information on the merchandise.

Single Administrative Export Document: it is a mandatory document where all the merchandise to be exported is declared.

Transport documents: it serves to prove the state in which the merchandise has been received in the destination territory.

Certificate of origin: this document is issued by the Chambers of Commerce and certifies the origin of the merchandise.

Now that you know some aspects about the export of products, it is important to keep in mind that before executing any operation for your company or business, you must have qualified personnel with perfect command of all the regulations in international trade that can guarantee the effectiveness of the transaction.

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