Singapore companies are already exploring cooperation with Turkmenistan in the chemical and private education sectors, and there is potential to increase trade flows further, said Senior Minister of State for Trade and Industry Koh Poh Koon on Monday.
Dr Koh was speaking at the inaugural Singapore-Turkmenistan Business Forum, organized in conjunction with the two-day state visit of Turkmenistan President Gurbanguly Berdimuhamedov.
Turkmenistan was represented by government officials and members of the Union of Industrialists and Entrepreneurs of Turkmenistan.
Dr Koh said the total bilateral trade in goods between Singapore and Turkmenistan came up to $43.4 million in 2018. He told the forum at the Shangri-La Hotel that this indicates a potential for growth.
Singapore Business Federation chairman Teo Siong Seng said in his welcome address that current trade figures reflect a fivefold increase in Singapore exports to Turkmenistan since 2016, and noted growing interest between both sides' business communities.
Singapore’s main exports to Turkmenistan include machinery and equipment, mineral fuels, and rubber.
As Turkmenistan is one of Central Asia's fastest growing economies and endowed with vast natural resources, it is no surprise that some Singapore companies “have recognized Turkmenistan's economic potential and have taken steps to establish trade and investment links”, said Mr Teo.
Turkmenistan's gas reserves are estimated to be the world's fourth largest.
Chary Gylyjov, Deputy Chairman of the Cabinet of Ministers of Turkmenistan, said at the event that “investments act as the main instrument for the diversification of the economy”.
“Annually, the share of investment allocated to the economy is over 30 per cent of gross domestic product,” he said, adding that the share of foreign investment is up to 13 per cent of the total volume and that in 2018, the volume of investment in the country amounted to US$11.5 billion.
It was stated that Turkmenistan is open for investment cooperation in oil and gas industry, energy, chemical industry and construction of industrial facilities.
“At the government-to-government level, Turkmenistan and Singapore are working closely together to create conducive conditions for our businesses,” said Dr Koh.
For example, both countries just ended negotiations on an Avoidance of Double Taxation Agreement, which reduces withholding tax rates of dividends, interest and royalties, he added.
This is expected to boost cross-border trade and investment, and such efforts to improve the regulatory environments of markets are key to enhancing trade and investment flows - ultimately growing the economy, he said.
Dr Koh also encouraged the Turkmen people to consider Singapore as a “springboard into South-east Asia”, where great opportunities are provided for business communities. Turkmen companies that express a desire to gain access to this market can set up their representative offices in Singapore, he added.
Nine agreements were inked at the forum, including seven memorandums of understanding.
The MOUs signed on Monday included one on the development of the chemical and fertilizer sectors in Turkmenistan, and another for cooperation between higher education institutions.
The Association of Banks in Singapore, DBS Bank and the State Bank for Foreign Economic Affairs of Turkmenistan also signed cooperation agreements to strengthen collaboration in banking and financial services, including cross-border money transfers and payments, and to expand trade, financial and economic cooperation between the two countries.
Chamber of Commerce and Industry of Turkmenistan and Singapore Business Federation signed Memorandum of Understanding on cooperation between the two entities.
Ministry of Industry and Communications of Turkmenistan and Pacific International Lines Pte. Ltd. agreed on cooperation in the field of transport and logistics.
Union of Industrialists and Entrepreneurs of Turkmenistan also signed MOUs with Vallianz Holdings and Sun Connect Pte. Ltd.
The forum was preceded by an exhibition of export goods of Turkmenistan. It featured textile products, yarn, fabrics and finished sewing products, including jeans, elegant gift sets for bedding, kitchen and bath linen, silk products, and ornamental carpets.
The exhibition also includes products manufactured by Turkmen private companies, including home textiles, garments, detergents, stylish leather shoes, natural fruit juices and confectionery.