How to enter new international markets during uncertain times

Over 29,000 new companies were formed in Singapore in 2010, the highest number in the past 10 years. It is perhaps a sign Singapore entrepreneurs are confident about local and regionaleconomic prospects, despite uncertainty in international markets.

At the recent G20 meeting in Cannes, France, Prime Minister Lee Hsien Loong highlighted Asia’s emergence as a growth region while the Euro-zone and United Statescontinue to work through their economic challenges. The PM however, was clear to highlight Singapore’s significant trade and investment reliance on developed markets, despite their uncertainties.

So are there opportunities for Singapore startups and SME’s in developed economies, despite the downturn? The good news amidst this gloom is thatone developed economy has remainedeconomicallyresilientwhile experiencing a renaissance in its entrepreneurial environment– and Singaporean firms could benefit immensely.

The Canadian Opportunity for Singapore Entrepreneurs

Despite the economic difficulties of its largest trading partner, the United, States, Canada was named the top entrepreneurial hotbed amongst all G20 countries in a McKinsey & Company study released for the G20 Young Entrepreneurs Summit,which commenced November 1st in Nice.

The report cited Canada’s protective and fluid environment for entrepreneurs, high quality of education, lack of taxes and regulatory burdens, and opportunities for collaboration as the main reasons. The United States were ranked 2nd in the study.

The study also cited Canada’s strong culture of entrepreneurship, which respondents ranked third behind only India and China, as being particularly welcoming to developing ideas and concepts. This, combined with the stable business and regulatory environment Singapore entrepreneurs find familiar, could make Canada an excellent partner for new venture expansion.

Canada also emerged from the global financial crisis relatively unscathed compared to most Western economies. There were three major reasons: its strongbanking institutions, commitment to free trade and open markets, and generally successful federal and provincial economic stimulus programs.

Examples of Emerging Opportunities

The economic stimulus programs helped spur Canada’s already thriving research environment, resulting in increased technological developments and startup foundations. These startups have proven technology and are hungry for international partnerships to further commercialize their knowledge.

At the recently concluded Singapore International Energy Week, clean technologies from numerous Canadian companies were on display. Many Canadian firms are still in the early stages of exploring the Asian market with technologies that have succeeded in other economies. Many are actively seeking regional partnerships – partnerships that could easily be taken by Singaporean firms looking to expand internationally.

In partnering with Canadian researchers, Singaporean entrepreneurs in technology can also open new avenues for the continued development of Singapore’s top notch tech and innovation infrastructure. With Canada’s world leading research,Singaporean firms could also be supporting national development through the inflow of high quality technology transfer.

For example, the Southwest Ontario region of Canada, traditionally Canada’s Manufacturing Heartland, is being increasingly recognized as a hub of world leading research. Known for bordering the world’s busiest trade frontier with the United States (the Windsor-Detroit crossing), the region is also home to a large number of world class research Universities, include the University of Western Ontario and University of Waterloo. Involved in research around healthcare, ICT’s and clean energy technologies, there are numerous opportunities for technology transfer from this, and other, Canadian regions. The world famous BlackBerry is one example of research at the University of Waterloo that was commercialized for success.

Leveraging the North American Free Trade Agreement (NAFTA)

Finally, Singaporean business owners are now used to being on the doorstep to Asia and leveraging growth opportunities in the region. Likewise, Canada, in addition to its own strengths as anindependent economy, is on the doorstep of the world’s largest economy, the United States. Despite the downturn, the American bilateral trade relationship with Canada’s remains the world’s largest.NAFTA links 450 million people producing over US$17 trillion in goods and services. Singaporean startups can easily be a part of this economic model. A company can, for example, create a headquarters in entrepreneur-friendly Canada,while leveraging NAFTA to access American and Mexican markets.

So while Asia provides great opportunities for Singapore’s growing entrepreneurial sector, and continues to be a light amidst the darkness of international economic uncertainty, there are still opportunities available in the developed economies of the West. A bit of research intoCanada may yield some greatopportunities for Singaporean firms and investors. 

Rohan Belliappa, Executive Director, Canadian Chamber of Commerce in Singapore