The first FTA concluded between the EU and an ASEAN country has finally been concluded.
On 19 October the European Union (EU) and Singapore signed the EU-Singapore Free Trade Agreement (EUSFTA) and the EU-Singapore Investment Protection Agreement (EUSIPA) on the sidelines of the 12th Asia-Europe Meeting (ASEM) Summit in Brussels, Belgium.
Singapore and the EU launched negotiations of the EUSFTA in 2009. The Good and Services Agreement was concluded in 2012, and the Investment Protections Chapter in 2014. The agreement will come into force after it is signed and ratified by both parties. The ratification of the EUSFTA has been delayed due to the European Commission’s decision to request for a European Court of Justice opinion on its competences with regard to the EUSFTA.
Singapore and the 28 EU countries are important trading and investment partners. In 2014, our bilateral trade in goods with the EU stood at close to S$96 billion and the EU was Singapore’s 3rd largest global trading partner. Singapore is the EU’s 15th largest global trading partner and largest trading partner in ASEAN. The comprehensive and ambitious EUSFTA will improve Singaporean and European companies’ access to each other’s markets, and provide a stable and fair regime for foreign investors while preserving the right of the parties to regulate in the public’s interest. Using Singapore as a launchpad, European businesses will also be able to tap into the opportunities in the wider region.
The agreement signals the EU’s commitment to step up its engagement with Southeast Asia: It is a pathfinder for the EU’s FTAs with other ASEAN Member States and an important building block towards a potential EU-ASEAN FTA.
The EUSFTA was signed by Prime Minister Lee Hsien Loong for Singapore, as well as President of the European Council Donald Tusk; Federal Chancellor of the Republic of Austria, Presidency of the Council of the European Union Sebastian Kurz; and President of the European Commission Jean-Claude Juncker for the EU.
The EUSIPA was signed by Minister for Communications & Information and Minister-in-charge of Trade Relations S Iswaran for Singapore, as well as Permanent Representative of the Republic of Austria, Presidency of the Council of the European Union Nikolaus Marschik; and EU Commissioner for Trade Cecilia Malmström for the EU.
“The EUSFTA and EUSIPA are progressive agreements, with ambitious provisions to create more opportunities for businesses from both sides. This is the first free trade agreement between the EU and an ASEAN country, and reflects the EU’s continued interest in engaging ASEAN and anchoring its presence in the region. Both agreements serve as building blocks towards an eventual EU-ASEAN FTA, paving the way for future region-to-region cooperation,” said Mr Iswaran.
The EU and Singapore will now work towards ratifying both agreements, which will be sent to the European Parliament for approval. Once approved, the EUSFTA can be ratified and entered into force. It will additionally be sent to the regional and national parliaments of the EU member states for approval, before it enters into force. Singapore looks forward to an expeditious ratification of both agreements so that businesses from both sides can reap the benefits.
Sources: EU, Ministry of Trade and Industry Singapore