Free Trade Agreement between the EU and the Republic of Singapore – Analysis

Please note: Each EPRS Study is assigned a DOI (digital object identifier), which is a safe and long term way of ensuring a hyperlink to the full text of this report. However, when ESO creates this record, on occasion the DOI still has not been activated by the EU Bookshop. If you find the source url hyperlink does not work please use the alternative location hyperlink listed as a related url.This study analysed provisions of the EU-Singapore Free Trade Agreement concluded in May 2015 ('EUSFTA'). It compared EUSFTA with other 'new-generation' free trade agreements, such as the EU-Republic of Korea and the EU-Canada Comprehensive Economic and Trade Agreement. Overall, EUSFTA adopted a WTO+ approach and as a result significantly liberalised trade between the EU and Singapore compared to the current trade relationship.

The study found that a number of tariff and non-tariff barriers to trade in goods and services that currently existed between the parties would be reduced or removed on EUSFTA's entry into force. EUSFTA, as with other 'new-generation' FTAs negotiated by the EU, adopted a comprehensive approach, and contained innovative provisions on investment, intellectual property rights, competition and public procurement. It also contained provisions which reflected growing concerns about the impact of global trade, such as those on trade and sustainable development.

With regard to EUSFTA's potential impact on trade, the economic modelling estimated an increase of around 10% in trade volumes and greater volumes of foreign direct investment between the EU and Singapore as a result of the agreement. It also concluded that EUSFTA should lead to small increases of the gross domestic products of the EU and Singapore (0.06% and 0.35%, respectively).

The responses of a wide-range of EU and Singaporean stakeholder consultation revealed that, in general, EUSFTA was viewed positively and was considered a very ambitious agreement, which would offer new opportunities for trade and investment in the EU and Singapore. However, some concerns had been raised, especially by small and medium-sized enterprises. The implications of the result of the Opinion of the Court of Justice of the EU in case 2/15 of 2017, on whether the EU had exclusive competence to sign and conclude EUSFTA alone, was also analysed in detail.

The study recommended, notably, monitoring closely that commitments taken under sustainable development provisions were implemented and used effectively in practice.

European Parliament: European Parliamentary Research Service: Study, March 2018: Free Trade Agreement between the EU and the Republic of Singapore – Analysis http://www.europarl.europa.eu/RegData/etudes/STUD/2018/603864/EXPO_STU(2018)603864_EN.pdf

EP: EPRS: Briefing: International Agreements in Progress, June 2017: International Agreements in Progress: EU-Singapore Free Trade Agreement - Stimulus for negotiations in the region http://www.europeansources.info/record/international-agreements-in-progress-eu-singapore-free-trade-agreement-stimulus-for-negotiations-in-the-region/

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