As Singaporean companies prepare to expand their footprint across Southeast Asia, the Philippines is among those poised to attract a big chunk of those investments, according to British banking giant HSBC.
Around 77 percent of Singapore-based companies indicated plans to expand in the region and the Philippines was among the five most favored markets, based on a report by the Singapore Business Federation that was commissioned by HSBC.
The study sought the insights of 1,063 Singapore-based companies on their interest in overseas expansion. Of these, 86 percent were small and medium enterprises (SMEs), defined as those with annual turnover of 100 million Singaporean dollars or those with less than 200 workers.
The survey showed 74 percent of Singaporean firms already have existing operations in the Philippines. Other top markets are Malaysia at 87 percent, Indonesia at 81 percent, Thailand at 80 percent, and Vietnam at 74 percent.
About 21 percent of Singaporean companies expect to expand in the Philippines in the next two years, banking on the growing consumer market and overall investment climate.
Most of the Singapore-based SMEs entering the Philippines or expanding their operations are keen on local partnerships. The research found that more than 68 percent of those surveyed in the Philippines had a distributor or joint venture arrangement, the largest ratio within the Association of Southeast Asian Nations (Asean).
In a press statement, HSBC Philippines president and CEO Wick Veloso said: “Singapore-based SMEs can make a significant contribution to the Philippines’ economy. These firms are looking to expand beyond their domestic markets and can benefit from the cross-border activity that was previously seen as the domain of larger corporates.”