SMEs neeed more help navigating CPTPP deal
CPTPP trade deal expected to be ratified, which will bring tariff cuts and easier access to foreign markets
Some may scoff at Mr Samuel Tan's lofty ambition to break into more competitive overseas markets, when the small Singaporean firm he co-founded is barely two years old.
But a landmark trade deal set to take effect on Dec 30 may give small and medium firms like his a fighting chance when they expand abroad.
Tariff cuts, easier access to other countries' markets and the right to bypass restrictions on foreign companies are some of the sweet spots in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
On Wednesday, the pact crossed the majority threshold needed to bring it into effect when Australia ratified it.
Five of the other 10 CPTPP members have ratified it - Mexico, Japan, Singapore, New Zealand and Canada. The rest - Brunei, Chile, Malaysia, Peru and Vietnam - are expected to do so soon.
Whereas his company might previously have had to hire multiple data centres were it to expand to several countries, for instance, Mr Tan, 32, may soon only need one. The treaty would remove rules that force businesses to place data servers in individual markets in order to serve customers there.
His firm, Auk Industries, makes industrial productivity tracking systems.
But small and medium enterprises (SMEs) like Mr Tan's are an exception. Many are still largely uninformed about the CPTPP, and know neither its benefits nor the countries involved, several business owners told the Straits Times .
Association of SMEs president Kurt Wee said there was a need for more "structured information sharing" - such as business talks and overseas work trips - focusing on the CPTPP.
This would allow more of the 200,000 SMEs in Singapore to learn about the impact of the treaty on business, he said.
"It is not that SMEs do not want to find out about the CPTPP, but many are unfamiliar with the trade agreement," said Mr Wee.
For instance, many SMEs may be aware of the tariff reductions they would enjoy, but not the other parts of the treaty that could also be a boon - such as the ability to bid for government tenders in the other CPTPP countries, he said.
Singapore Business Federation (SBF) chief executive officer Ho Meng Kit said the SBF is reaching out to business chambers to raise awareness.
A Ministry of Trade and Industry spokesman said it, too, is working with government agencies and trade associations to engage companies through outreach sessions and seminars, while Enterprise Singapore and the Economic Development Board will continue to help firms access and establish supply chains overseas, including in CPTPP markets.