Immediate Benefits to Singapore from Comprehensive and Progressive Agreement for Trans-Pacific Partnership

39 Mr Ang Wei Neng asked the Minister for Trade and Industry (a) what are the estimated benefits of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) for the first three years when it is implemented; (b) which industries will benefit most from CPTPP; and (c) how will the Ministry educate and promote the benefits of CPTPP to the local companies.

The Minister for Trade and Industry (Mr Chan Chun Sing): Mr Speaker, the ratification and pending entry into force of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a strong affirmation of the Parties' commitment to free and open trade and a rules-based trading system. The benefits include greater business and investment opportunities. It will also enhance market access opportunities for Singapore businesses in CPTPP markets, especially Mexico and Canada, with which Singapore does not currently have bilateral Free Trade Agreements (FTAs).

For the 11 CPTPP countries as a whole, accounting for approximately 13.5% of the global economy and a market of 500 million people with a combined gross domestic product (GDP) of US$10 trillion, the Agreement is expected to generate an additional S$147 billion in global income. For Singapore, total exports and GDP are each expected to increase by 0.2% by 2035 arising from the CPTPP.

Many industries and sectors will be able to benefit from CPTPP. First, Singapore-based goods producers will benefit from preferential tariffs when exporting to a CPTPP market. Processed food, textile and apparel manufacturers, in particular, will benefit from preferential tariffs under CPTPP, which will be easier to qualify under CPTPP rules, to markets, such as Japan, Australia and New Zealand.

Second, service providers will benefit from preferential access in a wide range of sectors. Examples include transport and distribution services in Australia, energy and telecommunications in Mexico, and professional services in Canada.

Third, investors will benefit from the removal of foreign equity restrictions that would otherwise apply in certain CPTPP markets, such as the private healthcare, telecommunications, courier, energy and environmental services sectors in Brunei, Malaysia and Vietnam.

Fourth, enterprises will be able to bid for government procurement projects in Malaysia, Mexico and Vietnam, which were previously closed to foreign bidders. Beyond specific business opportunities, the value of CPTPP is in establishing a common set of enforceable rules that govern trade and investment in the 21st century. These include rules in the areas of e-commerce, innovative industries and provisions to help small and medium-sized enterprises.

The Ministry of Trade and Industry (MTI) is working with our agencies, and the Singapore Business Federation (SBF) and other trade associations and chambers to conduct outreach sessions to our companies on how to benefit from CPTPP. Our economic agencies, including Enterprise Singapore (ESG) and the Economic Development Board (EDB), are also at hand to facilitate companies' plans to access or establish supply chains in the CPTPP markets.

Mr Speaker: Mr Ang Wei Neng. Keep it short, please.

Mr Ang Wei Neng (Jurong): Thank you, Speaker. I have just two short questions.

Mr Speaker: One short question. We do not have time for two. Keep it short. Just one question.

Mr Ang Wei Neng: What is the timeframe for the rest of the countries to ratify CPTPP and whether the United States (US) has indicated an interest to join CPTPP?

Mr Chan Chun Sing: CPTPP will come into force shortly after six countries have ratified it. So far, we have three. We are on track to see three more countries come on board by the end of this year and we should see this enter into force by the first quarter of next year. As for the US, our focus at this point in time is to get CPTPP to enter into force and, subsequently, the US can then make its decision as to whether it wishes to join.

Mr Speaker: Order. End of Question Time. Ministerial Statement, Minister for Health.

[Pursuant to Standing Order No 22(3), provided that Members had not asked for questions standing in their names to be postponed to a later Sitting day or withdrawn, written answers to questions not reached by the end of Question Time are reproduced in the Appendix.]