The figure already falls within The Economic Development Board’s (EDB) $8 billion to $10 billion full year forecast and is also way higher compared to the $5.3 billion fixed asset investment (FAI) commitments posted over the same period last year.
Singapore continued to attract investments even as its economy came to a near standstill in the second quarter on the back of trade tensions and other global uncertainties.
The Economic Development Board’s (EDB) second quarter economic report showed that the city-state attracted nearly $8.1 billion in fixed asset investment (FAI) commitments in the first six months of 2019, reported CNA.
The figure already falls within EDB’s $8 billion to $10 billion full year forecast and is also way higher compared to the $5.3 billion FAI commitments posted over the same period last year.
Geographically, the US along with Europe and Singapore are the top three sources of FAI commitments, accounting for 43.2 percent, 34.6 percent and 13.6 percent respectively.
Economists attributed the strong FAI figure for this year to Singapore’s attractiveness as a place for global multinational corporations (MNCs).
This includes factors such as the city-state’s political stability, business-friendly environment, skilled workforce as well as well-developed infrastructure and connectivity.
“Singapore has always been attractive to MNCs but the trade war, which has resulted in companies re-shuffling their regional supply chains in response, has intensified the interest into the region and Singapore,” said DBS senior economist Irvin Seah.
In concurring, CIMB Bank economist Song Seng Wun, said: “Because of the uncertainties, Singapore as a ‘neutral zone’ continues to be attractive for businesses, especially for big-ticket items.”
“Companies are looking at the long run and obviously you think about where you want to position yourself when the cycle turns,” he added.
In February, EDB chairman Beh Swan Gin had said that he expects Singapore’s investment pipeline for this year to remain resilient despite significant uncertainties.
“The good news is that on the investment front, Singapore continues to be very attractive,” he said when asked if EDB’s forecast will be revised considering the challenging economic environment.
He explained that while companies may display “a certain lag” in decision making, especially on big investments, he still expects these to “flow through” this year.
“We will continue to see these investments come to fruition, so we expect fully to be able to meet the forecast that we shared at the start of 2019.”
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email email@example.com