Food Industry Asia: The Food Industry Is A Strong Contributor To Singapore’s Economy

Friday, September 30th, 2016 | 767 Views

Singapore’s food and beverage industry contributes an estimated S$14.4 billion (US$10.5 billion) to gross domestic production (GDP) and employs nearly 300,000 people, a report released by Food Industry Asia (FIA) shows.

The report, entitled “The Economic Impact of the Food Industry in Singapore”, reveals that the food industry’s total contribution to the economy is much higher than the food manufacturing sector’s S$3.2 billion (US$2.34 billion) share of GDP, once related activities such as logistics, distribution, retail and hospitality are taken into consideration.

The report also highlights ongoing research and development (R&D) in areas such as nutrition, flavours and food packaging, which form part of the broader food industry ecosystem in Singapore.

Oxford Economics produced the report for FIA, using information collected in 2014, the latest year for which full economic data was available.

Oxford Economics calculated the contribution of the food and non-alcoholic beverage industry to the Singapore economy by looking at three areas: i) food manufacturers’ contributions to GDP, employment, tax receipts and the Central Provident Fund (CPF); ii) the value-added contributions by companies involved in the distribution of food, such as wholesalers, retailers and restaurants across the same metrics; and iii) the wider economic impact through activities such as R&D, education and training.

Oxford Economics produced the report for FIA, using information collected in 2014, the latest year for which full economic data was available.
For instance, many companies have set up regional R&D hubs in Singapore to create healthier, safer and more environmentally friendly products. They also provide various skills development programmes to help build the capabilities of the local labour force.

The Oxford Economics report provides a comprehensive account of how the food industry contributes to Singapore’s economic activity, as well as to the nation’s status as a centre of advanced food manufacturing and a hub for economic, social and sustainable development.

“The findings from the Oxford Economics study show that companies in the food industry lead a range of initiatives to provide skills development for their workforces through education and training programmes, drive sustainable development activities to reduce waste and water usage, and promote healthier lifestyles amongst their workforces and the wider population,” explained Matt Kovac, executive director of FIA.

Quantitative research carried out by Oxford Economics revealed that a number of companies reported that Singapore is the leading location for consumer goods firms in South East Asia, in terms of geographical location, connectivity, political stability and the availability of skills.

Over half of the survey respondents reported that they undertake R&D activity in Singapore. Firms explained that these activities often focus on the development and testing of new products, as well as market research into consumer preferences and emerging trends. The benefits generated by this work include healthier and safer products, less resource-intensive packaging, and reductions in energy and water use.

“It is very encouraging to see that the food industry is also making a sizeable contribution to support Singapore’s status as a centre for advanced manufacturing, by investing and setting up R&D facilities in the country,” said Mr Kovac.

“The Economic Impact of the Food Industry in Singapore” study provides a robust assessment of the economic contribution of the food and non-alcoholic beverage industry in Singapore. It assesses the core economic impact of food manufacturing, as well as the activity supported by the companies who convey, distribute and prepare food for consumers throughout Singapore, such as wholesalers, retailers and restaurants. It also explores some of the wider effects of the food industry’s activities in supporting productivity and wellbeing in Singapore.

This report is the first of its kind done in Singapore, and the association is aiming to release similar reports every two to three years from here on, said Mr Kovac.