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Global Trade Practices and Strategy – Singapore Trade Competitiveness
Question 1
Singapore is ranked among the largest economies in the world by merchandise and services trade. Compare Singapore with another country in the Southeast Asia region in terms of trade and connectivity, and indicate what makes Singapore globally competitive by illustrating how Singapore benefits from the principles of the trading system, backed with latest available data. Your answer should not exceed 500 words.
Question 2
Company X set up its head office and sole manufacturing facility in ABC Island where its raw materials are imported by sea and its finished products are sold locally. A public health crisis occurred on ABC Island, leading to the closure of jetties and Company X suffered huge losses due to the disruption of its operations.
In no more than 500 words, propose recovery measures for Company X after the crisis. Your answer should draw on the concepts from Study Units 1 and 2 and examine several relevant measures in sufficient detail rather than list them briefly.
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Singapore Trade Competitiveness
With respect to the trade competitiveness of Singapore, it is one of the most trade dependent economies as its total trade value exceeds three times its GDP. In comparison to Indonesia, Singapore is better poised for efficient trade connectivity, logistics efficiency and integration into the global value chain.
Comparison with Indonesia
With respect to the trade volume and structure, the trade in Singapore is highly dependent on services whereas in case of Indonesia, it is mostly dependent on commodities. In terms of connectivity and infrastructure, the port of Singapore is among the busiest globally and Changi airport is a major air cargo hub. With respect to Indonesia, the infrastructure is not that effective as compared to Singapore which results in higher logistics cost and transit time. Finally in terms of the role in the global value chain, Singapore is known as the regional hub for multinational corporations whereas Indonesia is acting as upstream production rather than an intermediary.
Benefits from the global Trading system
Singapore enjoys significant advantages under the principles of multilateral trading system. It has a free and open trade mechanism, and follows the rules based system which has a strong legal and regulatory framework. It also facilitates effective trade through its efficient customs, and transparent policies that further contribute towards reduced transaction cost.
Global competitiveness of Singapore
Singapore is globally competitive because of strategic geographic location, political stability, skilled workforce and leadership in Logistic innovation.
Recovery measures for company X
The supply chain process of company X is adversely affected because of closure of jetties and this requires effective recovery strategies aimed at achieving resilience, diversification and risk management.
Supply chain diversification: It is important for company X to avoid reliance on a single transport route and look towards arrangements like secondary ports and multiple suppliers.
Inventory and buffer stock strategies: It is important for the company to maintain safety stock of key raw materials so that operational continuity can be maintained.
Business continuity planning: It is important to have a formal business continuity plan because the crisis clearly indicates the need for emergency logistics partnership, crisis communication protocols, and remote coordination systems.
Digitalisation and visibility: The company should make use of a supply chain management system that allows for real time tracking and better decision making during disruptions.
Financial risk management: Insurance coverage is an important strategy to avoid business interruption while maintaining sufficient liquidity to survive temporary shutdowns.
Local market and production flexibility: Company X should consider exploring partial local sourcing to avoid complete dependence on sea routes.
| This model answer is reviewed by Pamela Lim having expertise across business operations and strategic planning. Disclaimer: This answer is a model for study and reference purposes only. Please do not submit it as your own work. |
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