Mr Iswaran (left) during the signing ceremony yesterday. The agreements come at a time of growing interest among Singapore firms to explore opportunities in Africa. Photo: IE Singapore

SINGAPORE — The Republic yesterday inked several tax, investment and air services agreements with Africa, in a move that will boost relations with the world’s second-largest and second most-populous continent.
The agreements will also ease entry by Singapore firms into a region that investing guru Mark Mobius once described as the emerging market story of the next decade.

Among the agreements signed by Minister for Trade and Industry (Industry) Mr S Iswaran at the fourth edition of the Africa Singapore Business Forum (ASBF) was an Avoidance of Double Taxation Agreement (DTA) with Ethiopia, a Bilateral Investment Treaty (BIT) with Mozambique, and a Bilateral Air Services Agreement (ASA) with Nigeria.
“While our traditional overseas markets remain important, Singapore companies must venture beyond these markets to seize opportunities in untapped markets in regions such as Africa. Ethiopia, Mozambique and Nigeria are three fast-growing African economies and the agreements signed today signify commitment on the part of Singapore and the respective African governments to support trade, tourism and investment between our countries,” said Mr Iswaran.
The Ethiopia-Singapore DTA clarifies the taxing rights between Singapore and Ethiopia, on all forms of income flows arising from cross-border business activities, and minimises the double taxation of such income. This will lower barriers to cross-border investment, and boost trade and economic flows between both countries.
The Mozambique-Singapore BIT is a legally binding agreement which establishes rules on how Mozambique should treat investments from Singapore, and vice versa. With this agreement, Singapore companies operating in Mozambique will enjoy protection on top of that already accorded under the country’s domestic laws.
The Nigeria-Singapore ASA provides a framework to enable the establishment of air linkages between both countries, as airlines from the two countries can operate an agreed number of passenger and cargo flights between Nigeria and Singapore, and beyond both countries.
The ASBF, conceived and launched by IE Singapore in 2010, is a platform that brings together the business communities from Singapore and Africa every two years. This year’s event drew around 450 delegates from Africa and Singapore.
At the event, IE Singapore also announced its third overseas centre in Africa in Nairobi, Kenya. Scheduled to open next year, this centre is expected to serve as a launch pad for Singapore companies venturing into East Africa, a region home to the continent’s fastest growing economies including Ethiopia, Kenya, Rwanda, Tanzania and Uganda. IE Singapore’s two other offices in the continent are in Accra (West Africa) and Johannesburg (Southern Africa).
The agreements signed yesterday come at a time of growing interest among the Singapore business community to explore opportunities in Africa. Since 2005, Singapore-Africa bilateral trade has grown at a compounded annual growth rate of 5.2 per cent, reaching S$11.5 billion in 2015. As of end 2014, Singapore’s cumulative direct investments into Africa stand at S$22.1 billion.
There are currently 60 Singapore companies operating across more than 50 African countries in sectors such as agribusiness, infrastructure, urban solutions, logistics and info-communication technology sectors. Notable companies include agri-business firm Olam International, with operations in 24 African countries; Ascent Solutions, which has cargo tracking projects in Uganda and Rwanda; and Hyflux, which has a joint venture to develop infrastructure, utilities and environmental solutions for an integrated township project in the Morogoro District of Tanzania.
“Singapore companies are creating an impact in Africa,” said IE Singapore CEO Lee Ark Boon.
“(But) the Singapore-Africa partnership is also a two-way street. Increasingly, African companies are setting their sights on Asia,” he said, adding that Africa’s largest manpower staffing company, Adcorp Holdings, recently announced it had selected Singapore as the headquarters for its ‘‘rest of the world’’ operations.
“We anticipate and welcome more firms from Africa to establish themselves in Singapore,” Mr Lee said.