SINGAPORE – Singapore far exceeded its forecast for investment commitments last year by pulling in $15.2 billion, 39 per cent more than in 2018, despite a challenging year weighed down by global economic uncertainties.
This was driven by large manufacturing investments from semiconductor as well as energy and chemical companies, the Economic Development Board (EDB) shared at its year-in-review on Thursday (Jan 16).
“The 2019 investment commitment numbers are testament to Singapore’s position as the preferred location for companies to tap into Asia’s growth, and Singapore’s competitiveness as a hub for manufacturing, innovation and digital activities,” said EDB chairman Beh Swan Gin.
The $15.2 billion of investment commitments beat the EDB’s forecast of $8 billion to $10 billion for the year, with the electronics industry accounting for some 28.4 per cent. It also exceeded the $10.9 billion of committed investments in 2018.
When fully implemented in the coming years, these projects will create 32,814 new jobs – almost double the forecast of 16,000 to 18,000 positions.
Significant commitments in 2019 include chipmaker Micron Technology’s “multibillion-dollar investment” in a new and expanded plant in Woodlands and gas giant Linde’s US$1.4 billion (S$1.9 billion) investment in a new complex on Jurong Island.
Dr Beh said that the strong figures from 2019 reflect companies’ confidence in Singapore’s fundamentals. Firms are investing for the long term and preparing for the eventual upturn in demand despite the challenging economic climate, he said.
Companies across a variety of industries continued to establish and expand headquarter activities and hub services, as well as build digital capabilities for themselves and their customers, and the EDB also landed investments across the innovation value chain from product management to research and development, he noted.
EDB managing director Chng Kai Fong said that Singapore’s position at the heart of a growing Asia, the Republic’s value proposition of trust and stability and the sophisticated capabilities of its economy are key reasons for Singapore’s strong investment commitments.
The projects committed to in 2019 are expected to contribute $29.4 billion in value-added per annum – the direct contribution to Singapore’s gross domestic product.
Total business expenditure per annum, which refers to companies’ incremental annual operating expenditure such as on wages and rental, was $9 billion in 2019. This exceeded the forecast $5 billion to $7 billion.
Mr Chng said the EDB would continue to focus on three key areas: strengthening Singapore’s position as a platform for companies to tap opportunities in South-east Asia, reinforcing the Republic’s role as a hub for manufacturing and non-manufacturing companies to develop and deliver digital solutions, and supporting companies in their innovation journeys.
He announced also that the EDB would be moving towards a multi-year perspective instead of a year-on-year view, as it is more reflective of companies’ plans.
It aims to continue attracting $8 billion to $10 billion investment commitments and create 16,000 to 18,000 jobs annually over the medium- to long-term.
The EDB expects investment commitments for 2020 to come above the forecast, based on its early view of projects coming in, Mr Chng shared.
Dr Beh said: “Although the global operating environment remains uncertain, we are cautiously optimistic that the investment flows in 2019 will continue into 2020 and bring good business and job opportunities for Singapore and Singaporeans.”