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ESG data, reporting also make business sense

Companies can collect environmental, social and governance (ESG) data from various sources and innovative technologies like artificial intelligence (AI), machine learning and data analytics are increasingly used to collect and analyze these data, according to sustainability curricula.

“The advantage of collecting such (ESG) data –it is not only for reporting to the government but also the company themselves have the idea of what they are doing right and what they are doing wrong. And this in turn also translates to where their costs can be reduced. So ESG is not only important from a social responsibility kind of point but it also actually makes business sense,” Deloitte India Executive Director Amrita Ganguly said in a webinar.  

Ganguly presented the key content of the United Nations Industrial Development Organization’s (UNIDO) Learning and Knowledge Development Facility (LKDF) sustainability curricula during its official launch on May 14.

The curriculum materials support industrializing countries to better comply with sustainability regulations, implement sustainability initiatives, and drive overall sustainable development.    

Ganguly said a systematic and planned ESG data collection helps to efficiently collect, measure, record and disclose the correct data.

“Robust ESG data empower decision-makers for identification of potential risks, seize opportunities, and enhance long-term value,” she said.

Ganguly said standards which companies bring out of these kinds of ESG data include the Global Reporting Initiative (GRI), standards developed by Sustainability Accounting Standards Board (SASB), framework developed by Task Force on Climate-related Financial Disclosures (TCFD), and reporting framework of Carbon Disclosure Project.   

ESG data collection methods include internal sources; external sources; emerging technologies; and surveys, questionnaires and stakeholder engagement, she said.

“Companies collect ESG data from their own records and operations. This may involve analyzing financial reports, HR (human resources) records, and sustainability reports to assess their environmental impact, employee practices, and governance policies,” she added.

Ganguly said external data sources include publicly available information, such as government reports, regulatory filings, and data from third-party ESG research providers.  

“Companies often distribute surveys or questionnaires to collect specific ESG data from their stakeholders, including customers, employees, suppliers and investors,” she said.

Ganguly also underscored the importance of tracking ESG data.

“Of course measuring performance, it is not only a fringe concern but it actually gives a very good insight into whether the operations of the company are in line or not. Benchmarking is another important aspect so the company can actually understand with respect to the industry peers, with respect to say energy performance, water performance, waste management,” she added.

Ganguly further said ESG data is also imperative in identifying trends, patterns and anomalies that might not be immediately obvious; ensuring compliance to avoid legal or financial penalties; and allowing organizations to track progress toward sustainability goals and objectives.

“ESG data can identify potential risks and vulnerabilities, allowing organizations to take proactive measures to mitigate them,” she added.

Manufacturers need to build a culture of cyber resilience—expert

By following three key principles, manufacturers can integrate cyber resilience into their organizational culture to help boost their own security and that of the other organizations in their business networks, according to an automation and technology expert.

Blake Moret, chief executive officer of US-based provider of industrial automation and digital technologies, in a recent article published by the World Economic Forum, said a cyber attack on a manufacturer can have significant knock-on effects that can even spread beyond the industry to other organizations along the supply chain.

“The global spread of manufacturing production facilities creates complex supply chains in which producers are also often consumers. Manufacturing is also inherently intertwined with other sectors such as logistics, energy and information technology. And so, any disruption to the manufacturing process can cascade throughout many other sectors—and around the world,” he said.

Moret further shared that heightened connectivity and data transparency has made manufacturing the most targeted sector for cyber attacks for three years in a row. It now accounts for 25.7% of attacks, with ransomware involved in 71% of these incidents.

However, he also noted how the manufacturing sector faces challenges building cyber resilience. Chief among these is the cultural mindset gap between enterprise and industrial environments, with the latter often prioritizing physical safety over cyber safety.

Technical challenges are also a major barrier. Outdated legacy systems and connected assets within industrial control systems have left many manufacturing organizations unprepared to repel sophisticated cyber threats.

Manufacturers are also often reluctant to take factories offline to make upgrades in security or deal with cyber attacks, said Moret.

Additionally, manufacturing is influenced by external forces such as the global inflation and rising energy costs, which add to manufacturers’ hesitancy to make improvements.

Another complication is that manufacturers must navigate various regulations and industry standards concerning human and product safety, data protection and cyber security.

Moret said that regardless of these complexities, the manufacturing sector must deal with cyber challenges so it can explore new technologies in a secure manner. He outlines three cyber resilience principles that companies can apply to their operations:

•    Make cyber resilience a business priority. This principle emphasizes the need for cultural change and a comprehensive cyber security governance. It also covers the importance of securing budget and resources, while also creating incentives to ensure that cyber security is an objective embraced by all stakeholders.
•    Drive cyber resilience by design. This means integrating cyber resilience into every aspect of processes and systems. A risk-based approach must be used to incorporate cyber resilience into the development of new products, processes, systems and technologies.
•    Engage and manage the ecosystem. This principle underlines the importance of fostering trusted partnerships and raising security awareness among stakeholders. Rather than having one organization exert control over a supply chain of other actors, an ecosystem approach involves encouraging all entities in a business network to collaborate to address issues like cybercrime.

Source: PHILEXPORT News and Features
Photo source: Canva
August 27, 2024

More Chinese investors entering Thai property market

Investment funds from China being used to snap up condos and houses for later resale, property consultant says
An increasing number of companies funded by Chinese investors have been buying properties for rent and sale in key economic cities, and the government’s plan to increase the leasehold period for foreigners from 50 to 99 years is expected to further boost this trend, consulting firm Property DNA said.
The proposed plan also aims to increase foreign ownership in condominiums from 49 to 75 per cent of usable space.
“These companies, established under Thai law or through a joint venture with Thai partners, have been using investment funds from China to buy condominiums and houses in big cities,” Property DNA’s managing director Surachet Kongcheep said on Monday.
“They aim to sell or rent these properties to wealthy Thais or foreigners later on, especially those looking for residences in Bangkok, Pattaya and Phuket,” he added.
The firm estimated these Chinese-funded companies have invested over 100 billion baht in these cities in the past 15 years.
Surachet said that if the proposed plan to increase the foreign property ownership ratio and leasehold period was approved, it could spur more Chinese investors to enter the Thai property market to snap up units in anticipation of increased demand from foreigners.
“Thai property developers estimate that the new rules would help expand the sales among foreign buyers, but it could be these companies, operated by Thai nominees or Thai joint investors, that will sweep up all the supply,” he said.
The Department of Business Development reported that in the first half of 2024, Chinese companies invested 382.06 billion baht in Thailand, or 9.48% of all foreign direct investment. This put China in third place of countries investing the most in the kingdom, following Japan (993.35 billion baht, 24.65%), and Singapore (473.57 billion baht, 11.75%).
The top five industries/sectors to received the most investment from China are automotive and parts (19.47 billion baht), tyres and inner tubes (16.86 billion baht), property not for own residence (14.62 billion baht), steel and iron manufacturing (13.65 billion baht), and electricity generation and distribution (12.93 billion baht).

Source : THE NATION

Cambodia becomes world’s second largest producer of raw cashew nuts, CAC says

Cambodia has become the world’s second-largest producer of raw cashew nuts, with a total production of 830,000 tonnes in the last seven months of 2024, according to the report of the Cashew Nut Association of Cambodia (CAC).

CAC said, there has been a significant increase in cashew exports to Vietnam, amounting to over 780,000 tonnes valued at $1,092 million. This represents 36.7 percent increase in volume and 28.1 percent increase in value.

Uon Silot, President of the Cashew Nut Association of Cambodia (CAC), told Khmer Times on Sunday that this increase is not accidental because, since May, the CAC has seen a significant increase due to cashew nut crops adapting to the El Nino phenomenon, while the area under cultivation has also slightly increased as well.

It may be recalled that on September 2023, the CAC announced that Cambodia might be impacted by about El Nino phenomenon. The association has issued some guidelines both for CAC members and farmers, in general, to be prepared to maintain a good harvest. “The CAC instructions were adapted hence the yields increased,” said Silot.

The world’s first-largest producer of raw cashew nuts is Ivory Coast, while Cambodia overtook India as the second largest. India dropped to the third place due to climate change.

Silot said, “This information is important as it could attract more foreign investors. When thinking of cashews, we should think of Cambodian cashews.”

CAC wants to attract more investment for local processing so that the cashew policy 2022-2027 can achieve greater results.

“This is what the CAC and other parties have always dreamt of, because the more factories we have, the more jobs we can create in the community, reduce migrant workers and help farmers maintain a fair price by providing value-added to our farmers by reducing a large number of brokers,” Silot emphasised.

For full article, please read here



Writer: Mom Kunthea 
News: Khmer Times 

Thai Government to Enhance Oversight of E-commerce

The government is prioritizing the protection of local small and medium-sized enterprises (SMEs) from unfair competition. They are considering implementing stricter import controls and potentially introducing a value-added tax on imported goods priced below 1,500 baht to create a more level playing field for Thai businesses.


Key Takeways

- The government has been urged to strengthen regulatory oversight on the e-commerce sector to ensure consumer protection and fair market practices. This call comes amid rising concerns about fraudulent activities and a lack of transparency in online transactions.

- Key stakeholders, including regulatory bodies and consumer advocacy groups, emphasize the need for stricter guidelines and monitoring to safeguard consumers against scams and inadequate product quality in e-commerce platforms.

- Enhanced regulations could also facilitate a more competitive environment for legitimate businesses, ultimately benefiting both consumers and entrepreneurs in the rapidly growing online marketplace.


The Thai government is increasing its supervision of foreign e-commerce platforms, particularly the Chinese online retailer Temu, to ensure compliance with Thai laws and tax regulations. This action is prompted by concerns from local businesses about the potential market disruption caused by the influx of low-priced Chinese goods, particularly those offered by Temu with discounts as high as 90%.


Source: Thailand Business News

Foreign investors set to increasingly focus on ASEAN, Thailand

CIMB Thai (CIMBT) anticipates increased opportunities for foreign direct investment (FDI) in Thailand due to the global trend of relocating manufacturing bases amid heightened US-China trade tensions.
According to Wut Thanittiraporn, CIMBT's head of corporate and transactional banking, with the global shift in manufacturing, Asean and Thailand have emerged as prime destinations for both direct and indirect foreign investment. CIMBT, as a regional financial institution network, is actively engaging with several large corporate companies interested in investing in Thailand.
These companies are seeking financial support from the bank worth US$300-500 million, he said.
Mr. Wut said corporate customers, including local, regional, and international companies, typically collaborate with Malaysia-based CIMB Group for their regional business expansion, encompassing both direct and indirect investment.
"The trend of manufacturing relocation and the high growth potential of ASEAN economies are expected to create significant opportunities for both outbound and inbound investments across the region," he said, adding that CIMB Group focuses on four regional strategic markets: Malaysia, Indonesia, Singapore and Thailand. This year, the group is concentrating on four key investment themes: sustainability, artificial intelligence, food security and consumer behaviour.
CIMBT is committed to supporting corporate clients with both outbound and inbound investments under these investment themes. The bank aims to expand its total corporate loan portfolio to 100 billion baht in 2024, following an increase in loans outstanding to 90 billion baht in 2023, up from 80 billion baht in 2022.
Due to the good asset quality of the corporate customer segment, CIMBT has successfully controlled non-performing corporate loans to a satisfactory level of around 1.7%, down from around 2% at the end of last year.
Mr. Wut highlighted the strengths of each regional market under CIMB Group's strategy. In Thailand, potential industries include tourism, healthcare, logistics, and data centres. Both foreign and large Thai corporations see opportunities for mergers and acquisitions in regional markets, with portfolio investment being a key strategy for local companies seeking investment returns in overseas markets.
"Despite Thailand's GDP growth being lower than its regional peers, the country remains attractive for FDI as foreign investors use Thailand as a production base for re-exports," he said.
According to CIMBT Research Center, global FDI declined to UScopy.3 trillion in 2023, a 2% year-on-year decrease, due to the worldwide economic slowdown and increased geopolitical tensions. However, FDI to Asean rose to $226 billion, a 1% increase.
Singapore ranks first in Asean for attracting FDI, followed by Indonesia, Vietnam, Malaysia, the Philippines, and Thailand since the start of the year. This indicates a continued shift of production bases to regional countries.

Source: Bangkok Post

Swift growth expected for Cambodia’s data centre market

The Cambodia data centre and data centre colocation market is poised for swift growth in coming years, driven by the country’s ongoing digital transformation, local data hosting trends and cloud expansion, according to a recently-released research report by AstuteAnalytica India Pvt. Ltd.

According to the reports findings, the Cambodia data centre colocation market was valued at $156.42 million in 2023 and is projected to reach a sum market valuation of $415.56 million by 2032.

The findings project a compound annual growth rate (CAGR) of 12.3 percent for the sector between 2024 and 2032.

The report suggested that the sector’s growth in coming years will be supported by international alliances with major international IT players, leading to more colocation facilities in-country; and a strategic alignment of digitisation with the nation’s long-term socioeconomic and political goals.

Top drivers in the market cited by the report include rising internet penetration and digital transformation initiatives across various sectors, Government incentives and policies supporting data centre industry development, as well as a growing need for disaster recovery and business continuity solutions within the cloud data space.

According to the findings, as of 2023, Cambodia had over 10 million internet users and upwards of 20 million mobile subscriptions, which has meant that the demand for reliable and secure data storage solutions has and continues to escalate.

The increasing volume of data from social media and over-the-top (OTT) platforms within the nation, with over 500 million hours of content streamed monthly as of 2023, is likewise pushing the demand for more colocation facilities.

For full article, please read here


Writer: James Whitehead
News: Khmer Times

Adoption of skills framework boosts competitiveness of MSMEs

Micro, small and medium enterprises (MSMEs) are advised to adopt a skills framework for enhancing their workers’ skills for specific job roles to boost productivity and competitiveness, better positioned to compete in both local and global markets.

Jayvie Guballo, resource person for human capital development (HCD) in Philippine Trade Training Center-Global MSME Academy, said the Philippine Skills Framework (PSF) has been developed for logistics and supply chain, and creatives (digital arts and animation and game development), and HCD and business development.

Guballo said the PSF is a comprehensive and authoritative document that identifies the actual jobs available in the industry and the skills needed to qualify and improve curriculum.

“(PSF) enhanced productivity. Upskilling and reskilling employees lead to more efficient operations and higher productivity. When training and skills of our employees are updated, expect that your business operations run smoothly and business become competitive,” he said during the recent MSME Week 2024 celebration in mixed English and Filipino.
  
Guballo said the PSF also guides businesses for their workforce become more capable of adopting new technologies and innovative practices  

“Especially in marketing, if we want to upgrade the skills of our sales person, they should have an idea on the digital way of marketing,” he said.

Guballo said the skills framework also enhances the ability of business to compete in the markets.

“Because of the training and because of the capacity-building, employees and business owners will have an idea how to integrate their products to be sold in local and global markets,” he added.

Guballo further said investing in employee development can also lead to higher job satisfaction and retention rates.

 “Training is a good thing. Business owners should realize that training needs to be integrated as part of their budget,” he said.

August 2, 2024

Asean and the Middle East: Deepening ties to unlock economic and trade opportunities

AT A time of increasing trade turbulence, economic diversification has become a dominant theme. Against this backdrop, the Asean-Middle East corridor is gaining in prominence as the two regions enjoy economic and connectivity potential, solid growth prospects and favourable demographics.

Although the links between the 10-member Asean bloc and the Middle East are not as extensive as those with other regions, there are reasons to believe that there is a great deal of untapped potential.

Take trade, for example. At present, bilateral trade, which totalled more than US$126 billion in 2023, is uneven. Aside from certain products, Asean’s exports to the Middle East remain rather limited. While Asean’s exports to the Middle East and North Africa (Mena) – defined as the Gulf Cooperation Council (GCC) countries plus Egypt – has grown over the years, the absolute level of exports is only a third of that of total imports from Mena.

On the flip side, 6 per cent of Asean’s imports come from the Middle East, on average. They are heavily concentrated in the energy sector. While non-fuel imports have risen steadily over the years, fuel imports dominate with a share close to 80 per cent.

It is worth stressing the role of Singapore as one of the world’s top three oil trading and refining hubs, despite having no hydrocarbon resources. Around half of Singapore’s crude oil imports come from the Middle East, particularly from the United Arab Emirates (26 per cent) and Qatar (13 per cent).

According to the US Energy Information Administration, Singapore has a refining capacity of 1.3 million barrels per day, before exporting its refined petrochemical products to its Asian neighbours. Asean peers, along with China, consume the lion’s share of Singapore’s petrochemicals exports.

That said, the heavy reliance on energy trade points to significant opportunities for Asean in the non-energy space.

International Trade Centre data indicates that the region’s unrealised potential exports approach US$$30 billion, on a par with its actual exports. Electronic equipment and electric machinery stand to benefit as Asean deepens its integration in the global electronics supply chain.

At the same time, Mena’s unrealised export potential to Asean is estimated at US$18 billion, with plastics, chemicals and metals being the promising exporting industries.

With the average tariffs in the two blocs remaining elevated, increasing efforts are being made to promote trade opportunities between the two regions. Singapore, for example, is the only Asean country that has signed a free trade agreement (FTA) with the GCC while others have either launched or signed FTAs with individual economies.

On a regional level, it is encouraging that Malaysia proposed an Asean-GCC FTA last October. While negotiations may take time, the conversation is moving in the right direction.

Apart from trade, investment is also an emerging area for cooperation between the two regions, particularly given the financial strength of Mena. However, the bulk of flows are in the form of portfolio investment rather than foreign direct investment (FDI).

From the perspective of FDI into Asean, Asian investors dominate whereas FDI from Mena accounts for a marginal share. However, it is interesting to note where Mena’s investment flows into Asean are.

A third went into Asean’s property sector, followed by the finance and mining sectors. In recent years, rising interest from Mena investors in Asean’s tourism, renewable energy and food sectors has been attracting attention.

However, for now, Mena’s portfolio inflows take the lead. Despite limited data availability, the trend is clear: Malaysia, Indonesia and Singapore are the main beneficiaries. For example, Singapore is no stranger to investment flows from private equity firms and sovereign wealth funds in the Middle East.

In addition to goods and investment flows, people-to-people integration is another key focus. As a region that offers a diverse range of tourism products, Asean has gained popularity among Mena tourists since the pandemic.

Thailand stands out, attracting more than half of the 1.1 million Mena tourists who visited the region in 2023. While the number of visitors is still limited, spending power matters. Mena tourists not only tend to stay for twice as long as the average tourist, but they also spend 30 per cent more – almost US$200 per day.

A similar trend can be seen in Singapore. Visitors from the Middle East last year rose to 130,000, almost back to pre-pandemic levels while overall tourist numbers are at only 70 per cent of the 2019 total. As Singapore is not a traditional tourist destination per se, but rather a global hub for business travel, its people-to-people exchanges with the Middle East are likely to be defined by the increasing business connectivity.

While the links between Asean and the Middle East are not as far-reaching as those with other regions for now, the journey does not stop here. The potential remains untapped, and the two regions are set to benefit from further connectivity.

Source: The Business Times
Link: Here

Steady growth for Asean+3 on export growth, tourism recovery and domestic demand

Growth across the region is expected to ease slightly next year as the global economy continues to stabilise and monetary easing in major economies resumes

THE Asean+3 region – China, Japan, South Korea and the 10 Asean member states – is expected to expand at a steady pace of 4.4 per cent this year, the Asean+3 Macroeconomic Research Office (Amro) said on Tuesday (Jul 16).

The macroeconomic surveillance organisation attributed the sustained growth momentum to resilient private consumption, export growth and a sustained recovery in global travel.

The revival of tourism lifted domestic spending significantly and this – coupled with improving prospects in key export markets – helped bolster business sentiment in recent months, noted Amro in a quarterly update of its flagship outlook report on the 10 Asean member states plus China, Hong Kong, Japan and South Korea.

The updated July prediction of 4.4 per cent gross domestic product growth is marginally lower than April’s estimate of 4.5 per cent.

Said Amro’s chief economist Khor Hoe Ee: “Real estate aside, China’s economy continues to grow robustly. Tourism has rebounded close to pre-pandemic levels for most economies in the region, and the global semiconductor recovery is broadening to benefit more economies and sectors in Asean+3.”

In particular, brighter global demand prospects are reflected in the upward growth revisions for Vietnam – which saw a 0.3 per cent increase to 6.3 per cent – and South Korea, whose growth estimate rose to 2.5 per cent from 2.3 per cent, said Amro.

These increments helped offset Japan’s half-percentage-point cut. Compared with projected growth of 1.1 per cent in April, Japan is now expected to expand by 0.5 per cent this year, in line with slashed forecasts across the board.

Dr Khor explained in a virtual press briefing that the country has had a “very weak” first half of the year that was bogged down by sluggish consumption.

“But we do expect the economy to begin to recover and strengthen,” he continued, pointing out Amro’s growth forecast of 1.4 per cent for Japan next year.

Growth estimates for 2025 were broadly maintained as well.

Amro expects growth across the Asean+3 region to ease to 4.3 per cent next year, marginally higher than April’s estimate of 4.2 per cent, as regional economies converge to their trend growth.

This comes as the global economy continues to stabilise and monetary easing in major economies resumes, said Amro.

“The recovery in China is also anticipated to normalise next year, with the help of targeted policy interventions to steer the property sector into a more sustainable growth trajectory,” the report said. “Tourist volumes should be back to pre-pandemic levels by next year for most economies, alongside a stronger pick-up in manufacturing exports.”

Inflationary pressures subside
Inflation this year is anticipated to ease to 2.1 per cent from April’s projection of 2.5 per cent, on the back of softer-than-expected food prices in several economies and lower imported inflation, said Amro.

This is excluding Laos and Myanmar, where inflation is largely driven by persistent currency depreciation.

While inflation for the 12 economies is expected to trend upwards to 2.3 per cent next year as economic momentum gains traction, higher cost pressures are unlikely to trigger a large spike in inflation, noted Amro.

That said, Amro maintains that downside risks remain, particularly if geopolitical tensions escalate and trigger global commodity and shipping price hikes.

Brighter skies ahead
The overall risk landscape assessment for the region has improved since April, said Amro, which earlier maintained that the overall balance of risk to Asean+3’s outlook is tilted towards the downside.

Potential trigger factors – such as price shocks, weaker-than-expected growth in China and sharp growth slowdowns in the US and Europe – remain broadly the same, but their underlying risks to growth and inflation receded, added Amro.

“The bad news is that the region’s outlook next year could be significantly affected by the outcome of the US elections,” said Khor.

“The good news is, the region has weathered similar shocks before. Our economies need to keep rebuilding policy space and pursue policies to enhance resilience to shocks.”

Source: The Business Times
Link: Here

Asean bourses to increase region’s attractiveness through sustainability, market connectivity initiatives

Investors in the region could potentially have greater access to opportunities in neighbouring countries

THE chief executive officers of six major stock exchanges across Asean are pushing to make the region more attractive to investors by working on four proofs of concept (POCs) over the next three years, the bourses said in a joint statement on Tuesday (Jul 16).

The initiatives include establishing a regional data infrastructure and a standard ESG curriculum for listed issuers.

The POCs were discussed at the 37th Asean Exchanges CEOs Meeting held in Malaysia on Friday. The meetup included top executives from Singapore, Malaysia and Thailand, among others, while representatives from the Cambodia and Laos bourses were present as observers.

The concepts aim to establish a sustainability ecosystem – one of the group’s two focuses to boost the region’s competitiveness, with the other tenet being promoting regional market connectivity.

The president and CEO of the Philippine Stock Exchange (PSE), Ramon Monzon, noted that “sustainability is a collective endeavour”. 

The PSE was in July this year included in the Asean-Interconnected Sustainability Ecosystem, which seeks to boost sustainable development by implementing common ESG metrics in its members’ respective data infrastructures.

The CEOs of the exchanges also agreed to jointly pursue offering depository receipts (DRs) in their bourses. Investors across the regional bloc could have greater access to investment opportunities in neighbouring countries, if DRs grow into an Asean-level initiative. 

The agreement follows the launch of Singapore DRs last year, under a collaboration between the Singapore Exchange and the Stock Exchange of Thailand.

Source: The Business Times
Link: Here

More Singapore firms want to expand into Europe, using Germany as a springboard

MUNICH - About an hour’s drive out of Munich in a town called Bad Tolz is a production facility that produces equipment such as valves for aircraft. It might be miles from home, but the facility is owned by Singapore Aerospace Manufacturing, a subsidiary of Singapore precision engineering and technology group Accuron Technologies.

It has 250 staff and serves customers like Boeing and Airbus.

Accuron’s group chief executive Tan Kai Hoe said the acquisition was a way for the company to diversify its service and product offerings, while allowing further investments in Europe. Accuron also has facilities in France, Austria, Britain and Northern Ireland.

“If you want to grow, you do have to go overseas, there’s no two ways about it because the market in Singapore is just not able to sustain an international engineering manufacturing group,” he said.

“So you select where to go, based on where customers are, the kinds of skilled workers and technology that you need.”

Indeed, more Singapore companies are setting their sights farther than the immediate region of South-east Asia and China, with a growing interest in expanding into Europe, according to Enterprise Singapore (EnterpriseSG).

In 2023, the agency supported 220 companies in exploring Europe, including markets in Germany, the Netherlands, France, Sweden and Britain. This was 20 per cent higher than in 2022 and nearly 50 per cent more than in pre-pandemic 2019.

EnterpriseSG director for Europe Alan Yeo said: “These numbers have increased steadily, especially post-Covid when there was pent-up demand, and we saw a spike in the number of companies willing to come out to see opportunities in Europe in the last few years.”

He noted that Europe has some of the world’s largest economies and offers opportunities in technology and innovation. Singapore companies can leverage the region’s tech expertise and partner companies to acquire technologies. Sectors that hold promise include advanced manufacturing, healthcare, digitalisation and biomedicine, he added.

Singapore companies can play in Europe’s green economy space, as Europe’s governments and companies are keen on the green transition, he said. The green economy includes the offshore wind sector, e-mobility, smart cities and agri-food tech.

Europe has a large consumer base, which provides opportunities for Singapore’s lifestyle products and services.

In particular, Europe’s consumers are ready for sophisticated products or those with sustainability attributes, Mr Yeo said.

Mr Lee Pak Sing, EnterpriseSG assistant managing director for trade and connectivity, said that Singapore firms can play a role in trade and logistics, such as in helping European products to reach Asian markets or taking Asian products to Europe as materials.

For instance, local firm Apeiron collects used cooking oil in the region and sells it to European firms to make biofuel, hence playing a role in the sustainability chains of European companies.

Germany as the gateway
When it comes to picking which European country to start in, Germany is a good bet as one of the world’s largest economies that offers a gateway into the region.

Mr Yeo said it has a strong manufacturing sector that contributes about 20 per cent of the nation’s economy, which mirrors Singapore’s as well. It is also a leading innovation hub in Europe, he added.

Some Singapore companies have used acquisitions in Germany as their entry point into the continent.

For Accuron’s Mr Tan, Germany’s strategic location in the middle of Europe makes it a good place to start the company’s expansion into Europe.

Other draws of the country include its stable political and economic environment, which ensures a secure setting for long-term investments, he said.

He added that Germany’s strong industrial base and its dedication to a strong education in science, technology, engineering and mathematics mean there is a skilled manpower pool available.

Accuron chose the merger and acquisition approach so that it could quickly establish a market foothold, tapping existing networks and integrating technologies, processes and expertise into the company, Mr Tan said.

Another company that took the acquisition approach in Germany is Singapore-listed Nanofilm Technologies International, which acquired thin-film coating solutions provider AxynTeC, which serves the industrial, decorative and medical industries in areas like Southern Germany, Austria and Switzerland.

Its group chief commercial officer Ian Howe said: “Today we have a very strong footprint in Asia, but we also see big potential in European markets. We see that advanced materials are established in Europe and the lead original equipment manufacturers are open to the technologies we deploy. So we do see business in Europe for Nanofilm, starting with the advanced materials space.”

Advanced materials solutions are those that have novel or enhanced properties, such as enhanced wear resistance.

Mr Howe added that Nanofilm agreed to join forces with AxynTeC because it was important for Nanofilm to start its European expansion in Germany, which is the largest and most active market for its products.

AxynTeC has a 25-year history and is well respected in the industry, which makes it a good platform for Nanofilm’s growth and accelerated entrance into Europe.

Opportunities for start-ups
While big companies may be able to acquire small and medium-sized enterprises to get a foot in the European door, Singapore start-ups also have opportunities to enter Europe through Germany.

EnterpriseSG runs a programme called the Global Innovation Alliance, which has networks in 21 cities globally, including Munich and Berlin.

Since 2019, the agency has supported more than 500 Singapore tech companies through the programme, which has benefited over 700 participants in their firms’ overseas expansion efforts.

On average, the number of Singapore firms that participated in the programme in Europe grew at a compound annual growth rate of 43 per cent from 2020 to 2022.

Germany is an innovation hot spot that offers opportunities for Singapore firms in med-tech, climate tech, smart city and Industry 4.0 solutions, said Start2 Group’s Linda Nguyen Schindler, who is director of the Artificial Intelligence Competence Centre, Asia.

Start2 Group is EnterpriseSG’s partner for the global innovation alliance acceleration programme in Munich and Berlin. It also helps to bring German start-ups to Singapore for collaborations that can allow both sides’ entry into their respective markets.

One Singapore start-up that benefited from the global programme is TeleMedC, which develops artificial intelligence diagnostic technologies to detect early changes in the eye to prevent blindness.

The company started operations in 2017 and participated in the EnterpriseSG programme in Germany in 2021. Through the programme, TeleMedC met a contact who helped the firm to settle in Hamburg, getting a two-year research grant to work with the local university hospital.

“TeleMedC is now signed with multiple healthcare partners to roll out this summer. Having progressed well in Germany, we now feel confident that it can be our gateway to other markets in Europe,” said the company’s founder and chief executive Para Segaram.

He added: “It takes time to understand the local market, laws governing hiring, accounting, and we had to rely on translation software and the internet search engines to learn the subtle nuances of communication and work culture.”

Start2 Group chief executive for global and Europe Matthias Notz noted that there are opportunities for German start-ups to connect with those in Singapore, adding that Singapore is a launchpad for the Asian market.

“That’s important because the start-up ecosystem consists of collaborations. You cannot innovate without collaboration. It’s not the collaboration within Munich or between Munich and Frankfurt. It’s the collaboration on a truly international level,” he said.

German company Tiramizoo, which develops software to help companies optimise last-mile deliveries, came to Singapore in 2019 and opened a subsidiary in Kuala Lumpur in 2023.

Along the way, it worked with Singapore start-up dConstruct Robotics, which delivers solutions for mobile robotics applications. Through this collaboration, dConstruct Robotics opened a subsidiary in Munich.

Tiramizoo chief executive Martin Straeb said: “We have gained partners and been working with other companies in Singapore, which helps us gain knowledge in robotics, for example.”

Source: The Straits Times
Link: Here

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