Bilateral trade development during economic downturn: The EU trade negotiations with Singapore:

Abstract: This thesis examines the bilateral trade development between the European Union (EU) and Singapore in the aftermaths of the 2008 economic turmoil, with emphasis on the top traded commodities. Furthermore, this thesis also contains an empirical study with an attempt to analyse the impact of the financial crisis, as perceived by European companies operating in Southeast Asia, on a more corporate level. In addition, their perception of a proposed EU-Singapore free trade agreement‟s (EUSFTA) impact on European companies‟ business activities in Southeast Asia will be explored. This endeavour should be seen in the EUs attempt to maintain its position competitiveness in world trade, which have been challenged by the rapid growth of East Asia, particularly at a time when multilateral trade agreements has been a slow process. It has been found that the bilateral trade between the EU and Singapore has, despite rapid growth in absolute values during the past decade, not developed at the same pace as intra-regional trade in Southeast Asia. Trade patterns reveal that the financial crisis that commenced in 2008 has affected commodities to various degrees, depending on industry sector. The recession is perceived to have affected European companies‟ business activities in Southeast Asia to various degrees. While assessing the EUSFTA positively, European companies expect a rather limited impact on their business activities in the region. However, the findings serve to caution against a possible backlash in the EUSFTA negotiations and make a strong case for the possibilities and benefits the agreement would generate both parties, in particular the EU. Considering that Singapore has signed FTAs with Japan, the US, Australia, India, and more recently China, the question is not “What advantages can EU business get from an EUSFTA?”, but “What disadvantages can EU business suffer for not having an EUSFTA?”