In Singapore’s bustling metropolis lies a harbour designed to facilitate

different trading businesses and catalyse international trade: the Free

Trade Zones (FTZs). An FTZ is basically any location where goods can
be manufactured, reconfigured, handled, shipped, and re-exported
without any customs agencies being involved. A border facility
between at least two countries, an international airport, or a major
seaport may be designated as an FTZ. These FTZs can provide
significant economic benefits for both host countries and hosted
enterprises.

At present, there are over 3,500 FTZs—usually located at critical ports

—in 130 economies or countries in Europe, North and South America,
Africa, and the Asia-Pacific Region. In Asia, particularly, many
countries have already introduced FTZs to grow their national
economies by attracting foreign direct investment (FDI) into these
areas. The qualities of FTZs in these Asian countries are essentially
the same – they are deemed outside-of-customs territory designed to
provide a business-friendly environment with good infrastructure,
incentives, and other benefits.

In Singapore, there are a total of nine FTZs today located in five

different geographical areas operated by three FTZ authorities, namely
Jurong Port Pte Ltd, PSA Corporate Pte Ltd, and Changi Airport Group
Pte Ltd. To better understand what these FTZs are and how they are
boosting international trade, this article provides a brief overview of
the FTZs found in Singapore and enumerates the different advantages
that these FTZs have for businesses.

An Overview of Singapore’s Free Trade Zones

As mentioned earlier, Singapore operates nine FTZs where goods can

be shipped, handled, stored, and distributed without being subject to
goods and services tax (GST), excise charges, or customs duties.
These FTZs are a crucial part of the trade strategy of Singapore and
are aimed at promoting the country as a hub for international trade.
The nine FTZs in Singapore are as follows:

 Keppel District Park

 Brani Terminal
 Sembawang Wharves
 Tanjong Pagar and Keppel Terminal
  Pasir Panjang Wharves
 Changi Airport Group
 Changi Airport Cargo Terminal Complex
 Singapore Airport Logistics Park
 Jurong Port

These FTZs in Singapore are governed by the Free Trade Zones Act,
which was enacted in 1986 and was most recently deliberated for
amendments this year. The proposed amendments to the Free Trade
Zones Act seek to address increasing concern over the exploitation of
FTZs in the country for illegal activities by bolstering the regulations,
licensing regime, and law enforcement in the Free Trade Zones Act. So
far, the FTZ Amendment Bill already passed through a second reading
on October 4, 2023.

This FTZ Amendment Bill is set to be implemented from the start of

2024, and affected individuals and enterprises will be given six months
to comply with the new requirements found therein. Among the most
essential Singapore FTZ amendments that individuals and businesses
should expect are a new licensing regime for FTZ operations, new
regulations on agents and cargo handlers, and expanded powers of
customs officers and the Director-General in order to strengthen the
enforcement of the law.

Amidst concerns over the changes brought by the amendments to the

Free Trade Zones Act, the Singapore Government gives the assurance
that businesses operating within the law in the FTZs will not be
strongly impacted by the changes since the FTZ Amendment Bill
mostly aims to tackle criminal activity and is applicable only to FTZ
operators, agents, and cargo handlers. Indeed, according to Senior
Minister Chee during the Bill’s second reading, the Singapore FTZ
amendments are merely targeted at bad actors, while maintaining a
business-friendly operational environment for genuine users.

The Benefits of Singapore’s Free Trade Zones

In the dynamic landscape of international trade, business owners and

enterprises constantly look for avenues that offer them a premium
edge to propel their businesses to success. The FTZs in Singapore
have emerged as a beacon of hope and opportunity, convincing many
entrepreneurs with a variety of benefits, such as the following:
1. Simplified Procedures

Customs procedures within Singapore FTZs are expedited and

simplified, thereby minimising bureaucratic difficulties and saving
valuable business time. The inspection systems of these FTZs are also
standardised to prevent administrative intricacies. This allows trade-
related documents like customs permits, certificates, and declarations
to be checked promptly and accurately, decreasing the risk of non-
compliance and possible penalties, and increasing the efficiency of
import and export procedures.

2. Exemptions from Taxes and Customs Duties

The Free Trade Zone Act imposes no GST or customs duties on

products imported into the FTZs for as long as they are being re-
exported. Moreover, non-controlled goods are exempted from permits.
This exemption enables businesses to import raw materials, parts, or
finished products to Singapore at quite low costs, thereby increasing
an enterprise’s price competitiveness and profit margins in the
Singapore market.

3. Streamlined Transportation and Logistics Services

The FTZs in Singapore are home to excellent transportation and

logistics facilities, such as the Changi Airport and the Port of
Singapore, which deliver timely access to international markets. The
efficient transportation, handling, and storage of products within the
FTZs reduce transit times and lessen the risk of disruptions or delays.
This ultimately facilitates just-in-time inventory administration, which
greatly minimises holding costs.

4. Opportunities for Collaboration and Networking

The FTZs in Singapore serve as a hub for a wide array of enterprises,

attracting businesses from various sectors and industries. This
creates a vibrant business ecosystem wherein like-minded individuals
can connect with one another, exchange ideas and insights, and
explore possible collaborations. This collaborative ecosystem of the
FTZs serves as an absolute catalyst for entrepreneurial trade success
and fosters a vigorous business community.
 Conclusion

FTZs play a critical role in boosting the economy and trade not just in
Singapore but all over the world. With their numerous objectives
specified in the Free Trade Zones Act as well as proven benefits, there
is no doubt that FTZs catalyse international trade and facilitate a
great range of trading businesses. This makes Singapore, with its nine
FTZs, a true hub for economic opportunities and activities, thereby
facilitating the flow of products, services, and investments across
borders.

About Maritime Fairtrade

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in Singapore.

Singapura: Laissez-Faire dengan Sentuhan Pemerintah yang Bijak

Singapura sering disebut sebagai contoh penerapan laissez-faire yang sukses. Namun,
kenyataannya, pendekatan ekonomi Singapura lebih bernuansa dan melibatkan
perpaduan antara prinsip laissez-faire dan intervensi pemerintah yang strategis.
Aspek Laissez-Faire di Singapura:
 Perdagangan Bebas: Singapura menganut perdagangan bebas dengan tarif rendah
dan sedikit hambatan perdagangan. Ini menarik investasi asing dan meningkatkan
akses ke pasar global.
 Investasi Asing: Pemerintah menyambut investasi asing dengan regulasi yang ramah
bisnis dan infrastruktur yang memadai.
 Tenaga Kerja Terampil: Singapura berinvestasi dalam pendidikan dan pelatihan untuk
membangun tenaga kerja yang terampil dan kompetitif.
 Intervensi Strategis Pemerintah:
Meskipun menganut laissez-faire, pemerintah Singapura memainkan peran aktif dalam
beberapa bidang:
 Infrastruktur: Pemerintah membangun infrastruktur kelas dunia seperti pelabuhan,
bandara, dan telekomunikasi. Ini menjadi landasan bagi pertumbuhan ekonomi.
 Sektor Strategis: Pemerintah berinvestasi di sektor-sektor kunci seperti manufaktur
dan jasa keuangan untuk mendorong pertumbuhan yang ditargetkan.
 Jaring Pengaman Sosial: Program-program sosial seperti asuransi kesehatan dan
perumahan terjangkau diterapkan untuk memastikan stabilitas dan kohesi sosial.
Faktor Pendukung Keberhasilan Singapura:
 Hukum dan Kepercayaan: Singapura memiliki sistem hukum yang kuat dan tingkat
korupsi yang rendah. Masyarakat memiliki kepercayaan tinggi terhadap pemerintah dan
institusi.
 Meritokrasi: Budaya meritokrasi di Singapura menghargai individu berdasarkan
kemampuan dan kontribusi mereka, mendorong kerja keras dan inovasi.
 Lokasi Strategis: Letak geografis Singapura yang strategis menjadikannya pusat
perdagangan dan keuangan global.
Dampak Penerapan ini:
 Pertumbuhan Ekonomi: Singapura telah mengalami pertumbuhan ekonomi pesat
selama beberapa dekade.
 Kemakmuran: Standar hidup di Singapura tinggi, dengan infrastruktur modern, layanan
kesehatan berkualitas, dan keamanan yang tinggi.
 Pusat Perdagangan dan Keuangan: Singapura menjadi pusat perdagangan dan
keuangan utama, menarik perusahaan dan investor global.
Namun, ada juga kritik:
 Ketimpangan Pendapatan: Tingkat ketimpangan pendapatan di Singapura tinggi.
 Biaya Hidup Tinggi: Biaya hidup, terutama perumahan dan pendidikan, cukup mahal.
 Tekanan Kerja Tinggi: Budaya kerja kompetitif dan penuh tekanan.
Kesimpulan:
Singapura membuktikan bahwa penerapan laissez-faire dengan modifikasi bisa menjadi
strategi efektif untuk pertumbuhan ekonomi dan kemakmuran. Namun, penting untuk
mengelola potensi dampak negatif seperti ketimpangan pendapatan dan tekanan kerja.

Pertumbuhan Ekonomi yang Pesat:

 Singapura mengalami pertumbuhan ekonomi yang pesat selama beberapa dekade, dengan
rata-rata sekitar 7% per tahun sejak kemerdekaan.
 PDB per kapita mencapai US$70.810 pada tahun 2023, menjadikan Singapura salah satu
negara dengan pendapatan tertinggi di dunia.

Kualitas Hidup Tinggi:

 Singapura memiliki standar hidup yang tinggi, dengan:

o Infrastruktur modern dan efisien.
o Layanan kesehatan berkualitas tinggi.
o Keamanan publik yang terjamin.
o Tingkat pengangguran yang rendah.

Pusat Perdagangan dan Keuangan Internasional:

 Singapura telah menjadi pusat perdagangan dan keuangan global utama.

 Faktor pendorongnya adalah:
o Lokasi strategis di Asia Tenggara.
o Stabilitas politik dan ekonomi.
o Sistem hukum yang kuat dan transparan.
o Keberagaman tenaga kerja dan bahasa.
o Infrastruktur keuangan yang maju.

- Meningkatnya lapangan kerja penuh dan bergabung dengan Hong Kong SAR, Republik Korea,
dan Taiwan, Tiongkok.
- Singapore menjadi salah satu lingkungan regulasi yang paling ramah bisnis di dunia bagi para
pengusaha local.
- Singapore menempati peringkat negara terbaik di dunia dalam hal pengembangan sumber daya
manusia.

Beberapa konsekuensi negatif telah muncul meskipun Singapura mengalami kemajuan ekonomi
yang signifikan. Tantangan sosial disebabkan oleh ketimpangan pendapatan dan biaya hidup
yang tinggi. Selain itu, dampak pertumbuhan ekonomi terhadap lingkungan dan tekanan kerja
yang tinggi menjadi perhatian. Ketergantungan pada tenaga kerja asing juga dapat mengganggu
keseimbangan sosial. Untuk mengatasi masalah ini, pemerintah Singapura telah meningkatkan
bantuan sosial, berinvestasi dalam teknologi hijau, mendorong budaya kerja yang lebih
seimbang, dan membuat kebijakan imigrasi yang lebih inklusif. Oleh karena itu, Singapura
berusaha untuk memastikan pertumbuhan ekonomi yang berkelanjutan dan meningkatkan
kesejahteraan umum secara proporsional.

Meskipun Singapura menikmati kesuksesan ekonomi yang signifikan, beberapa dampak negatif
telah muncul. Tingkat ketimpangan pendapatan yang tinggi dan biaya hidup yang tinggi
menimbulkan tantangan sosial. Tekanan kerja yang tinggi dan dampak lingkungan dari
pertumbuhan ekonomi juga menjadi perhatian. Selain itu, ketergantungan pada tenaga kerja
asing dapat mengganggu kohesi sosial. Untuk mengatasi ini, pemerintah Singapura telah
mengambil langkah-langkah seperti meningkatkan bantuan sosial, promosi budaya kerja yang
lebih seimbang, investasi dalam teknologi hijau, dan pengembangan kebijakan imigrasi yang
lebih inklusif. Dengan demikian, Singapura berupaya menjaga pertumbuhan ekonomi yang
berkelanjutan dan meningkatkan kesejahteraan masyarakat secara merata.