As published on businesstimes.com.sg, Friday 30 July, 2021.
SWITZERLAND'S foreign direct investment (FDI) in Singapore shot up by 77 per cent to a record S$68.5 billion in 2019, compared with S$38.7 billion in 2017. The country has been among the top 10 foreign investors in Singapore for many years. Latest data shows that Swiss FDI rose 12.9 per cent in 2019 compared to 2018's figure of S$60.7 billion. FDI figures for 2020 are not available yet.
"One chief driver seems to be Singapore's finance and insurance industry, where the city's fintech scene is attracting major investments," says Switzerland's Ambassador Fabrice Filliez on the occasion of the Swiss National Day on Aug 1.
According to Switzerland's central bank, the Swiss National Bank, Singapore had the highest rate of return of all major investment locations of any Swiss foreign investment destination, at 32 per cent.
"Since the first Swiss trading firm was set up in Singapore in 1859, the number of Swiss companies in Singapore has increased over the years to more than 400 companies today, which employ a large cohort of around 25,000 employees. Singapore has become attractive not only for large companies with multinational interests, but also for small and medium enterprises," says the Swiss envoy.
"The main sectors of Swiss corporate presence in Singapore are the financial and insurance, wholesale and retail trade, as well as production. Almost all the major Swiss financial institutions and insurance companies are represented in Singapore, which underlines the importance and strength of Swiss institutions in South-east Asia...
"Moreover, business services, fintech, medtech, foodtech, logistics and information and communications technology investments have grown in recent years, as many Swiss companies leverage Singapore's position as a hub into South-east Asia and the Asia-Pacific region. Swiss investments have grown steadily over the last years," he adds.
Overall, Switzerland is the ninth-largest source of investment for Singapore after the United States, Cayman Islands, British Virgin Islands, Japan, Luxembourg, the United Kingdom, Bermuda and Hong Kong.
Besides Swiss FDI in Singapore, bilateral trade too is going strong. "The Swiss-Singapore trade relations are generally very stable, not least because of its long and rich history. The first traces of Swiss economic presence in Singapore go back to the 1860s when Swiss trading houses began to establish their branches on the island. Today, practically all major Swiss manufacturers and service establishments with worldwide activities are represented in Singapore," says Mr Filliez.
In 2019, Switzerland's services exports to Singapore registered a healthy 9.25 per cent increase to S$8.15 billion, up from S$7.46 billion in 2018, placing Switzerland as the seventh-largest import trading partner for 2019. For 2020, data for trade in services has not been released yet. However, Swiss export in goods to Singapore amounted to 6.4 billion Swiss francs (S$9.5 billion) in 2020, an increase of 2.9 per cent over 2019, he adds.
"Singapore ranked as the 11th largest export destination of Swiss goods worldwide and the third largest within Asia, after China and Japan. Chemical and pharmaceutical products are still leading the growth for exports from Switzerland to Singapore with a value increase in 2020. In the recently published statistics by the Swiss federal customs administration, Swiss exports to Singapore have grown by around 12 per cent in the second quarter of 2021," says Mr Filliez.
Swiss businesses in Singapore have taken significant strides forward in recent months.
In April this year, Swiss company Buhler, the food processing solutions giant, and Givaudan, the world's largest flavour and fragrance manufacturer, inaugurated a new plant-based protein innovation centre in Singapore, which is managed by experts from both firms, to increase the production of sustainable plant-based products on a global scale.
The protein innovation center will drive R&D innovation and facilitate plant-based product development on a global level. The inauguration was graced by Minister of State Alvin Tan, who was then invited to tour the facility with Mr Filliez and taste some of the plant-based dishes.
In August, the Nestle R&D Centre in Singapore - which was the Swiss firm's first Asian R&D Centre, will celebrate its 40th anniversary with a newly renovated R&D building featuring upgraded state-of-the-art facilities with new office spaces, experimental kitchens, laboratories, as well as consumer testing and sensory evaluation rooms.
Since opening in 1980 in response to the fast economic growth in the region and to enable the development of innovations tailored for South-east Asian consumers, it has, over the years, developed expertise in areas such as fermentation, plant-based food and beverages, cocoa beverages, coffee mixes and ice cream, resulting in patented technologies and the launch of a range of many products across multiple brands and categories.
Aside from commercial and economic relations, a growing Swiss presence can also be felt in the educational and cultural fields, says Mr Filliez.
"This year will be an important year for the EHL Campus in Singapore, which will receive its first cohort of around 60 students in September in its magnificent building located in the Orchard Road area and will possibly, if circumstances permit, organise an official inauguration ceremony this autumn," he adds.
Switzerland's Ecole hoteliere de Lausanne (EHL) has for the past three consecutive years been ranked as the world's best university for hospitality and leisure management. EHL has two campuses in Switzerland in Lausanne and Passugg.
Its Singapore campus is its first overseas campus and will be offering a range of programmes to provide lifelong learning opportunities. Besides its renowned Bachelor's Degree in International Hospitality Management, which will be its main programme, a variety of short courses for professionals to upskill in their careers are also planned to be offered here.
"By blending Swiss excellence and Asian refinement, the EHL Campus will contribute to fostering the bilateral cooperation between Switzerland and Singapore. Jenny Ang, managing director of the EHL Campus Singapore, will be supported by Luciano Lopez, the recently appointed dean of EHL Campus Singapore, who started his position in Singapore on 1 July 2021 with the mission to provide intellectual and academic leadership to the institution," says Mr Filliez.
"All these developments show the strength of the Swiss economy, finance, innovation and sustainability in the region and a close and strong relationship between Switzerland and Singapore," he adds.