In 1995, the United States trade deficit with Singapore was $3.2 billion, or
$907 million greater than in 1994. U.S. merchandise exports to Singapore were
$15.3 billion, up $2.3 billion or 17.6 percent from 1994. Singapore was the
United States' ninth largest export market in 1995. U.S. imports from Singapore
totaled $18.6 billion in 1995, 20.1 percent more than in 1994.
The stock of U.S. foreign direct investment in Singapore was $11 billion in
1994, 23.7 percent higher than in 1993. U.S. direct investment in Singapore is
largely concentrated in manufacturing and petroleum.
Singapore imposes tariffs on only four categories of imported goods; 99
percent of imports enter duty-free. In the Uruguay Round of multilateral trade
negotiations, Singapore agreed to bind 70 percent of its tariff lines (up from
one percent), compared to the United States which has bound 98 percent of its
tariff lines. The Uruguay Round agreement went into force on January 1,
Singapore still maintains significant tariffs on a few products, including
cigarettes, alcoholic beverages, automobiles and gasoline, both to discourage
their use and to raise revenue. Currently Singapore applies an excise tax of
S$30 per liter bottled and S$70 per liter bulk to all distilled spirits.
Imported beer and ale have an import duty of S$0.80 per liter; an excise tax of
S$2.80 is applied to both imported and domestically produced beer and ale.
Singapore has committed to continue to reduce the import duty and increase the
excise tax on beer and ale over time in order to gradually equalize tax
treatment for domestic and imported product.
Singapore offers tax incentives to exporters and reimburses firms for certain
costs incurred in trade promotion. The Government also offers significant
incentives to attract foreign investment, almost all of which is in
LACK OF INTELLECTUAL PROPERTY PROTECTION
Singapore continues to take concrete measures to improve its level of
intellectual property protection and strengthen enforcement. Singapore is a
member of The World Intellectual Property Organization (WIPO), and is a party to
the World Trade Organization agreement on Trade Related Aspects of Intellectual
Property Rights (TRIPs), though it has not committed to implementing the TRIPs
agreement by January 1, 1996, the date required of developed countries.
Singapore is not a party to the Berne Convention or the Universal Copyright
Convention. In 1987, following close consultation with the U.S. Government,
Singapore enacted comprehensive copyright legislation which relaxed the burden
of proof for copyright owners pressing
charges, strengthened civil and criminal penalties and made unauthorized
possession of copyrighted material an offense in certain cases. In January 1991,
Singapore similarly strengthened it trademark act. In 1994 Singapore enacted a
new patents act which was amended and strengthened in 1995 to make it consistent
with the TRIPs Agreement.
Singapore's 1994 patent act was not fully consistent with the TRIPs
Agreement, particularly with respect to compulsory licensing and government use.
In 1995, the Singapore Government enacted amendments which brought the patent
law into compliance with TRIPs. On January 1, 1996 the amendments came into
As a result of stepped up enforcement, copyright infringement in the computer
and software areas was significantly reduced in 1994. While the Government of
Singapore continues to take an active stance in protection of computer software
in Singapore, 1995 saw an upsurge of pirated CD ROMs enter the country from
China. The Business Software Alliance (BSA), industry and government are working
to close off the surge in illicit software. In response to motion picture and
phonographic industry requests that the Singapore Government do more to stem the
importation, sale and transshipment of pirated videos and CDs, Singapore's Board
of Film Censors instituted additional procedures in 1995 to screen for pirated
materials, verify copyright authorization, and make it easier for industry to
bring injunctions against infringers. In a recently completed civil suit brought
by the International Federation of the Phonographic Industry, Singapore's High
Court ordered a local distributor of pirated compact discs to pay $673,000 in
damages, the largest penalty ever in Singapore for copyright infringement.
While Singapore's copyright law is generally of a high quality, it lacks a
provision granting rental rights to copyright holders for sound recordings and
software, as is required by the TRIPs Agreement. Developedcountries are required
to bring their copyright laws into compliance with the TRIPs Agreement by
January 1, 1996.
In 1992, Singapore restructured the parastatal telecom authority by
separating the regulatory authority from the telephone company and the post
office. The Government of Singapore granted the corporatized phone company a
15-year monopoly for basic services and a 5-year monopoly on mobile services. In
1993, Singapore also began privatizing the telephone company by floating 11
percent of its shares worth S$4 billion (US$2.5 billion).
Singapore's broad definition of basic telecommunication services, which only
the national telephone company is permitted to provide, effectively restricts
market access for firms seeking to sell value-added network services (e.g.,
enhanced fax services). In 1995 Singapore upgraded its participation in the
WTO's Negotiating Group on Basic Telecommunications (NGBT) from observer to full
member, and tabled an offer in the negotiations. As of March 1996, Singapore's
offer retained monopoly or exclusive rights for basic telecommunications
facilities, and did not eliminate limits on market access and national treatment
until 2007, a period much longer than a number of other major international
Foreign law firms may only set up offices in Singapore to advise clients on
U.S. or international law. They can not hire or form partnerships with
Singaporean lawyers to practice local law in Singapore.
Singapore law requires that two-thirds ownership of an engineering firm be in
the hands of Singapore-registered professionals. This has forced some foreign
firms to divest majority ownership and has placed limitations on the ability of
new companies to enter the market. In 1994 Singapore amended its
architects/engineers act to exempt one third of the board members of a company
from requirements to be registered engineers or architects.
Insurance: Singapore has determined that the local insurance market
is saturated, and as a result has not issued any new licenses for foreign or
domestic firms seeking access to Singapore's insurance market for several years.
Singapore has stated that acquisition of a domestic company by a foreign company
would be permitted only if the domestic company needed additional capital. The
reinsurance market in Singapore is open to new entrants and captive insurance
licenses are available to subsidiaries of multinationals to underwrite their own
Banking and securities: Foreign penetration of the banking system of
Singapore is high compared to most countries foreign banks account for almost
half of all nonbank deposits from residents and more than half of all
Loans to residents
The Government of Singapore does impose restrictions on foreign banks,
however. In addition to a longstanding freeze on the number of full banking
licenses granted to foreign as well as domestic banks, those banks that already
have full licenses do not enjoy full market access. Foreign banks cannot open
new branch offices, freely relocate existing branches, or freely operate
off-premises automated teller machines (ATMs). In addition, foreign banks are
restricted to an aggregate 40 percent equity share in domestic banks in the full
license category. Offshore banking licenses for the Asian dollar market are
available to new entrants; Singapore actively encourages foreign participation
in the offshore market in which U.S. and other foreign banks have a substantial
In the securities area, foreign equity ownership of members of the stock
exchange of Singapore is limited to a minority stake, although foreign firms can
join in the exchange with an international membership with 100 percent foreign
equity. However, some restrictions apply to international members with respect
to the size of the lots they may trade and when executing certain transactions
At the conclusion of the Uruguay Round, Singapore did not sign the WTO
Government Procurement Agreement. In December 1995, Singapore initiated
negotiations to join the WTO Government Procurement Agreement (GPA) by tabling
an initial offer. As of March 1996, negotiations on Singapore's accession to the
GPA were continuing. The United States and Singapore agreed in March to provide
each other's products non-discriminatory treatment until July 31, 1996.