Baker Tilly's Managing Partner in navigating uncharted waters

Joshua Ong answers pressing questions about the trade war, SMEs and ever-resilient Singapore.

Joshua Ong, managing partner at Baker Tilly and head of the firm’s capital markets and IPO services, advises clients on their business expansion whether organically or through merger and acquisitions.

He has more than 20 years of experience in audit, consulting and commercial financial control and accounting, working with international accounting firms for more than a decade. He was involved in several local and cross-border IPOs, as well as due diligence projects and M&As.

When asked about the exodus of some multinationals from the mainland, Joshua thinks this pandemic has seen companies building resilience in their supply chain and diversifying production capabilities so as not to over-rely on China.

“South Asian countries like India, Vietnam and Thailand have benefited from such moves. However, China will remain an important manufacturing hub due to the whole ecosystem of component suppliers, distribution network and matured workforce built over the years that has made China a cost-effective and efficient place to manufacture goods,” he explained.

In times of uncertainty, he believes the stability and business friendly environment of Singapore will be attractive to companies seeking to expand, or locate certain parts of, their operations to the region.

Singapore Business Review had a quick chat with Joshua days before the winners announcement of the SBR Awards, as he shared his insights on how SMEs and homegrown companies are coping, the ongoing ‘trade war’ and where Singapore fares in all this uncertainty.

Which particular markets or sectors are your main focus? Can you share with us your work experience or any backstory that has contributed to your professional career?

Before taking over the managing partner’s role this year, I headed the Firm’s Assurance and Capital market practices. It is enriching to help clients with the successful IPO of their companies and, more importantly, capitalise on this platform to expand their business operations.

What can SMEs and other homegrown businesses learn from the crisis? For those who have been badly hit, what do owners need to consider on the road to recovery?

The extent of the restrictions on economic and physical activities like a circuit breaker in Singapore and lockdown in several countries as a result of this pandemic is unprecedented. Naturally, businesses that require high touch or physical interactions are most hard hit. While the immediate concern for many SME and local businesses is to manage their cash flows and survive this crisis, business owners should evaluate how their operations and processes can be digitised, and incorporate e-commerce channels for marketing and delivery of their products and services into their business models.

What’s your take on international companies moving their operations out of the Peoples’ Republic of China? Where are the opportunities and how does Singapore fare in all these?

Operational costs, especially labour costs, have been increasing in China over the years. Manufacturing plants, particularly for lower-end products and labour-intensive facilities, have already been moving out from China to lower cost countries in Indochina like Laos and Cambodia. The US-China trade war hastened the move due to additional tariffs imposed by the US on Chinese products.

This pandemic resulted in companies focusing on building resilience in their supply chain, and diversifying locations of their production capabilities to avoid over-reliance on a single manufacturing base. South Asian countries like India, Vietnam and Thailand have benefited from such moves. However, China will remain an important manufacturing hub due to the whole ecosystem of component suppliers, distribution network and matured workforce built over the years that has made China a cost-effective and efficient place to manufacture goods. China is also a key market for many products such as automobiles, luxury goods and telecommunication equipment, and as such, much of the manufacturing capacities is still required in China to cater to the internal consumption within the country.

In times of uncertainties, the stability and business friendly environment in Singapore will continue to attract companies to locate certain of their operations here or use Singapore as a financial hub and headquarter to support and expand their operations in the region.

Whilst we thought that investments were redirecting to other hubs, MTI reported that investments have already exceeded the full-year target in the first four months. What’s your take on this?

The trusted Singapore brand of being a stable and transparent environment for businesses, high-quality and skilled labour force will resonate well with companies and investors seeking to relocate or expand their operations.