www.business-in-asia.com feels fortunate to have the
of talking this month with U.S. Ambassador to Singapore, Steven J.
Green. Ambassador Green who has now been in his post for much of
the current Administration has guided U.S. relations with Singapore
through a critical period that included the Asian Financial
Crisis. Following are Ambassador Green’s responses to our
Q 1: How has Singapore responded to the Asian
financial crisis and do you believe the changes it has made will
or hurt Singapore's comparative advantage as a site for U.S. business
and U.S. exports?
A. Singapore responded
the crisis by taking measures to maintain its economic competitiveness,
in light of the relative appreciation of the Singapore dollar vis-a-vis
its neighbors and sharply reduced regional demand. Among the key
All these measures will make Singapore even more attractive to U.S.
exporters and investors. In particular, U.S. companies in the fields
of banking and finance, and information technology will be able to
increase their service exports to Singapore as well as expand their
presence here. U.S. manufacturers in Singapore have seen their costs
reduced as well.
- Reduction of overall business cost by over 15% in terms
of wage and pension cuts lower taxes and property prices.
- Diversification of exports to non-Asian markets, such as
- Continuing efforts to liberalize and develop the
- Starting efforts to restructure the economy to focus on
Q 2: Has political
instability in Indonesia and the Malaysian government's -decision to
further restrict their financial markets, hurt or helped Singapore?
A. Generally speaking,
the political crisis in Indonesia has hurt Singapore because it has
severely damaged one of Singapore's most important markets in the
region. Singapore's trade with Indonesia has fallen sharply as a result
of the sharp contraction of Indonesia's
economy last year. The sharp drop in Indonesian visitor arrivals to
Singapore has affected the local retail and services market.
Singapore's direct and indirect investments in Indonesia have also been
as evidenced in higher non-performing loans and generally lower returns
As for the impact of Malaysian capital controls on
this is a bit more complicated to assess. Instability in Indonesia and
economic problems in Malaysia have negatively impacted Singapore's
economy. To the extent that the Malaysian economy has stabilized
for a variety
of reasons, this has benefited Singapore exporters to, and investors
Q.3. Singapore has
a relatively high wage country by Asian standards. In this high wage
environment, what types of businesses still see Singapore as an
attractive venue for investment?
A. The businesses that
see Singapore as an attractive investment location are the kinds of
businesses Singapore wants to attract: knowledge-based
industries. Singapore also knows it needs to maintain its
competitiveness in the region. That's why Singapore cut business costs
last year to the extent that per unit
business costs are down almost 20% this year from a
Best service industry investment prospects are in financial
services, business services, warehousing and logistics. One quarter of
the Singapore economy is still in manufacturing. High end electronics
and petrochemicals remain good manufacturing investment possibilities.
Q 4. You come from a
business background and were instrumental in turning around several
major household names, such as Samsonite and Culligan Water. Given that
now your many years experience as U.S. Ambassador to Singapore, how
of a grade would you give the U.S. government in promoting sales of
smaller U.S. companies abroad? Further, could you explain how
things could be improved?
A. We're working hard
I believe there could be improvement in our overall effort. The
Commerce Department's Commercial Service and the Agriculture
Department's Foreign Agricultural Service spend much of their time and
effort helping American small and medium size enterprises (SME's)
export. But there is much more that could - and should - be done
by these two Departments and other government agencies. We are working
hard to improve things ourselves, as the answer to the following
Q 5. We understand the
U.S. Embassy in Singapore is considering a pilot program to improve
assistance to small and medium size U.S. companies desiring to export
to Singapore. Can you tell us what this pilot program will entail and
how it will help SME's export to Asia?
A. This program, SesaME,
has been in operation since early this year. It is designed to inform
encourage American SME's to look at exporting to Singapore and through
Singapore to the rest of Southeast Asia. SesaME will keep SME's current
on market opportunities and link them to services that can find them
distributors or joint venture partners. SesaME is supported by major
and American public and private business organizations. More
is available on the Commercial Service's website,
or e-mail email@example.com.
Q 6. Based on your
experience in Singapore and your business background, are there
where SME's can win sales without a formal office in Singapore or lots
of expensive investment?
A. Actually almost any
field is open to American SME's. A better question is what fields are
not open to American companies. There are very few if any. There are
thousand's of Singapore SME's already representing American products
in the Singapore and regional markets. We know they are eager indeed
to handle more product lines and business. Much if not most of
America's US$16 billion in exports to Singapore are already shipped by
companies without Singapore offices.
Q 7. During the recent
ASEAN Ambassador's Tour to the U.S., you spoke very eloquently about
Internet was changing Asia and how the Internet offered advantages to
countries with relatively small but highly educated and highly computer
literate populations. Can you give us your views on how the Internet is
changing Asian business and what recent trends hold for Singapore?
A. The Internet is
becoming a true paradigm shift for those SME's willing to take
advantage of it.
As Singapore and regional businesses become more internet-connected and
e-commerce oriented, size will no longer matter for American businesses
that want to sell into the region. SME goods and services can be as
as larger companies' products - and just as easy to order and ship. UPS
and Fedex can deliver quickly just about anywhere these days at
rates. Singapore, by the way, has invested very heavily in warehousing
and logistics. There are many Singapore and foreign companies offering
logistics support, allowing an SME to distribute from Singapore to the
region without the SME needing its own distribution operation.
Q 8. (Do the computer
Internet penetration figures) we see indicate that Asia is breaking up
a have and have-not block of countries based on access to the new
technologies. Does this have implications for American
A. Singapore's personal
computer penetration rate is about the same as the U.S. Internet
penetration is not as high, but growing rapidly. Other countries in the
region are, as you have noted, behind, although levels vary and the
business community is more connected than rural areas. Nevertheless,
this is another reason for American SME's to consider Singapore as
their gateway to the region. Singapore is already a "wired
island." E-commerce is up, running
and growing. American SME's can do business electronically now
Singapore SME's, who, in turn, can help them enter the regional market.
Ambassador Green, again thank you for your as usual thought provoking