What opportunities does the Belt and Road Initiative present Singapore?

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A view of Singapore skyline chenisyuan/Wikimedia Commons

Singapore's strong foundation in transportation, logistics, and finance has the potential to open new opportunities for the Lion City to thrive as China rolls out its Belt and Road Initiative (BRI).

This is according to Knight Frank's inaugural New Frontiers: The 2018 report, which assesses 67 countries considered vital to China's initiative. Singapore topped the report's Belt and Road Index, along with Qatar and the United Arab Emirates.

Knight Frank Singapore Head of Consultancy and Research Alice Tan said Singapore can expand its role as a global logistics and transportation hub given its location at the crossroads of East and West and along the BRI's 21st Century Maritime Silk Road.

"The island state receives some 2,700 vessel calls daily and 6,800 flights weekly, strengthening its global position as a key maritime center, the world's busiest port and one of the largest air transportation hubs in Southeast Asia," Tan noted.

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More so, the city-state's reputation as a financial center hub and one of the largest offshore Renminbi centers provides a key platform for Chinese firms to go global by tapping Singapore firms.

Figures from the Ministry of Trade and Industry show that over 6,500 Chinese firms have already set up shop in Singapore.

"The country's strong track record in project financing, with its established ecosystem of insurance, legal and arbitration expertise, positions it as a center for providing numerous businesses opportunities in the BRI," Tan said.

In fact, 60 percent of ASEAN infrastructure projects are financed by Singapore-based banking institutions.

Meanwhile, Tan stressed that China's initiative could substantially boost Singapore's external growth plans. In the past years, many Singapore enterprises and projects have adopted BRI-related policies and platforms to gain access to the Chinese market.

Singapore is actually working with the Chinese government in different projects such as the Chongqing Connectivity Initiative and the deal with Guangxi to improve connectivity between Western China and Southeast Asia.

"As both countries are supporters of free trade in the face of rising protectionist sentiments around the world, the building of the BRI together is anticipated to be the biggest highlight of Sino-Singapore bilateral relations, further cementing the tradition of close cooperation," Tan noted.

This article was first published on January 31, 2018