Singapore is strategically poised to become an international trade nexus, leveraging its prime location, robust infrastructure, and strong financial and legal institutions. By adopting a proactive approach, Singapore can shape international trade flows to its advantage and influence evolving rules rather than merely adhering to existing dynamics. By spearheading new initiatives and positioning itself as a leader in international commerce, the city-state can actively influence global trade policies and standards rather than being a price-taker.
Few economies are as exposed to global currents as Singapore. In 2023, cross-border trade in goods and services reached 311% of GDP, underlining both the rewards and the vulnerabilities of extreme openness. But Singapore also occupies a “privileged” position as a global city-state that has built a multi-hub trading nexus.
A lattice of 27 free-trade agreements (FTAs) and membership in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and Regional Comprehensive Economic Partnership (RCEP) keeps markets open. Yet a world of rival blocs and splintering digital standards demands more than passive participation. Singapore must become an architect of the next trading order.
Four mutually reinforcing initiatives can deliver that shift: BRICS partner status; an ASEAN–Australia–United Kingdom corridor (ASEANAUK); deepening the Mercosur–Singapore bridge to Latin America; and a formalized Forum of Small States (FOSS) common market.
In aggregate, these would anchor Singapore at the junction of trade flows, representing well over half of global output. Singapore is a small state with outsize influence and has deftly managed its position on the international stage. But the complexity of the global market and Singapore’s strategic role as a nexus for different trade geo-economic blocs means it has the capacity to build an ecosystem.
Leveraging Network Power
Singapore can take a page from Japan’s playbook. Japan’s “network power” approach in international relations focuses on building and strengthening alliances and networks to achieve its goals. This strategy is evident in its diplomatic, economic, and security partnerships, particularly in the Indo-Pacific. It achieves this through
● Diplomatic Influence: Japan fosters beneficial relationships and builds consensus through active participation in international organizations and forums, shaping global norms and standards.
● Economic Partnerships: Japan establishes extensive economic partnerships, promotes free trade agreements, and invests in infrastructure projects to facilitate regional integration and economic growth.
● Security Networks: Japan deepens its alliance with the US and strengthens security cooperation with countries like Australia, India, and the Philippines, participating in initiatives like the Quad to promote regional stability.
● “Smart Power” Approach: Japan leverages its economic, diplomatic, and cultural influence to achieve objectives, using limited resources effectively to exert a disproportionate level of influence.
Japan’s “network power” strategy enables it to shape regional and global affairs, promote peace and prosperity on a regional and supra-regional basis, and maintain a strong and influential presence on the international stage.
By focusing on collaboration, cooperation, and mutually beneficial solutions, Japan has built a reputation as a key stakeholder in the global commons, making it a significant “network power” in the Indo-Pacific.
This strategy is further exemplified in the 2010s, where the fastest-growing private enterprises in China were typically “mega ecosystem” players. Companies like Alibaba, Tencent, and Xiaomi achieved and sustained their growth through operating networks of businesses that can support and supplement each other’s capabilities. This was often achieved through acquiring minority positions with a path to a significant stake or control.
Business ecosystems are not a new concept. Apple Inc. was a pioneer in this regard when it launched the iPhone in 2007 and made the App Store its platform for distributing apps. Other leading U.S. tech companies, such as Amazon.com and Alphabet, are also ecosystem players. However, Chinese companies have turned out to be even more adept at building such organizations.
Chinese technology majors demonstrate that to build a successful ecosystem, you don’t need a majority stake in any one entity. Instead, you need to be comfortable with the idea of owning minority stakes in many entities and tying them together. Eventually, the thread that binds these properties delivers natural control.
Similarly, Singapore has stakes in many different geoeconomic arenas and trade blocs. This allows it to leverage its “network power” on the global stage. Through this approach, Singapore can position itself as the figurative, though understated, lumbar plexus—the most important nerve cluster in the human back—of world trade.
Megablocs & BRICS Partner: Laying the Foundation
The CPTPP, enlarged in December 2024 to include the United Kingdom (UK), now covers twelve economies worth about US $15.8 trillion (14% of world GDP) and 593 million consumers. Its rules on e-commerce, state-owned enterprises (SOEs), and investment protection set the bar for advanced trade disciplines.
RCEP, in force since 2022, links ASEAN with China, Japan, South Korea, Australia, and New Zealand. The bloc represents 32% of global GDP and 2.35 billion people, while its unified rules of origin cut compliance costs across Asian supply chains.
Underwriting the geometry of these geoeconomic blocs are enduring economic and strategic partnerships, supported by free trade agreements (FTAs) with countries such as South Korea, Japan, India, China, and Australia. These agreements provide the legal predictability essential for Singapore’s manufacturing, logistics, and financial ecosystems.
Singapore has further built on these economic links through forging comprehensive strategic partnerships (CSPs) with Vietnam and France in 2025. Additionally, Singapore is working to elevate its relationship with India to a CSP, with intentions announced in September 2024. This is cognizant of India’s quiet ascent as a balancing power and a third pole in the global systemic transition.
Economic connectivity and market access alone no longer ensure strategic centrality. Relevance now belongs to those who can integrate rival spheres and establish protocols for interoperability. This context raises the possibility of Singapore joining BRICS.
At the Kazan summit in late 2024, BRICS invited 13 “partner countries”—Belarus”, Bolivia, Cuba, Indonesia, Kazakhstan, Malaysia, Thailand, Uganda, and Uzbekistan—creating a two-tier architecture within a bloc that already accounts for 39.5 percent of global output in purchasing power parity (PPP) terms.
Southeast Asian nations’ interest in BRICS reflects a strategic shift in response to the complexities of a multipolar world. Indonesia’s admission to BRICS in January 2025, along with Malaysia, Thailand, and Vietnam joining as partner countries in October 2024, highlights the region’s pragmatic approach to diversifying diplomatic and economic ties.
While this alignment offers new opportunities, it may also challenge ASEAN’s cohesion and centrality. BRICS presents alternative avenues for economic growth, trade diversification, and access to development financing.
For Indonesia, membership enhances connections with major economies like China and India and provides access to the New Development Bank. President Prabowo Subianto’s remark, “A thousand friends are too few; one enemy is too many,” emphasizes Indonesia’s commitment to fostering diverse partnerships.
Malaysia views BRICS as a platform to bolster its renewable energy and technology sectors. Prime Minister Anwar Ibrahim clarified that Malaysia’s engagement is not about aligning with any bloc but adapting to global changes. A bid by Singapore for partner status would:
● Align it with moves by its closest neighbors (i.e., Indonesia and Malaysia) and preserve ASEAN cohesion.
● Expand reach into populous markets such as Brazil and South Africa.
● Enmesh Singapore’s finance center in BRICS’ New Development Bank and alternative payment networks.
● Harmonize rules—on data governance, carbon accounting, and supply-chain traceability—across CPTPP, RCEP, and BRICS, lowering friction for exporters.
ASEANAUK: The Anglo-Pacific Corridor
Britain’s Indo-Pacific “tilt,” Australia’s resource heft, and ASEAN’s manufacturing depth form a complementary triangle. A comprehensive ASEAN–Australia–UK FTA (i.e., ASEANAUK) would connect Europe’s leading services hub, Oceania’s mineral powerhouse, and Southeast Asia’s 680-million-strong consumer base under one legal roof.
The first phase would be a digital economy agreement to bind together cross-border data flows. This component can be modeled on the Digital Economy Partnership Agreement (DEPA), founded by Chile, New Zealand, and Singapore. In 2024, it welcomed South Korea, which aspires to be a “global pivotal state,” as a member.
A cross-border digital economy corridor could establish binding rules on data flows, AI governance, digital identity, and fintech sandboxes, facilitating convergent development and harmonized standards across the UK, ASEAN, and the Pacific.
Phase Two? Services and goods. Mutual recognition of professional licenses, progressive opening of education, legal and logistics sectors, and a tariff-elimination schedule beginning with climate-aligned products would follow.
With a secretariat in Singapore, dispute settlement and customs single windows would run through its jurisdiction, leveraging the city-state’s infrastructure for international arbitration. It also allows Southeast Asia to integrate the AUKUS security partnership into its economic framework, providing a channel to shape the engagement and behavior of the UK and Australia in the Indo-Asia Pacific.
Mercosur–Singapore FTA: a Pacific bridge to Latin America
Signed on 7 December 2023, the Mercosur–Singapore Free Trade Agreement (MCSFTA) is the South American bloc’s first deal with any Asian economy. It grants immediate duty-free access on 25 percent of tariff lines and phases out duties on 96 percent of products within 15 years.
Mercosur’s five members, Argentina, Brazil, Paraguay, Uruguay, and Bolivia, encompass more than 285 million people and nearly US $3 trillion in GDP. By combining Mercosur’s agribusiness and critical-mineral strengths with ASEAN’s electronics and agritech value chains.
The agreement anchors a Pacific trade corridor: Brazilian soy and renewable-energy inputs can move east while Southeast Asian semiconductors and digital services move west, all routed through Changi, Tuas, and Singapore’s data centers.
The corridor diversifies food and resource security for Asia while deepening Latin America’s participation in Indo-Asia Pacific supply networks—further entrenching Singapore as the hub through which those flows are orchestrated.
FOSS Common Market: small states, big leverage
The Forum of Small States (FOSS), established by Singapore at the United Nations in 1992, is an informal group of 108 members that represents about one-tenth of the UN’s total membership. FOSS welcomes countries with populations under 10 million, although some members have since surpassed this threshold.
Small states often embrace multilateralism as a strategy to amplify their influence and balance the power of larger nations. Research and historical examples show that these smaller countries can develop issue-specific power, allowing them to exert significant influence on critical matters despite their limited overall structural power.
In addition to prioritizing key issues, small states excel at coalition building and crafting their public image. Although they may have fewer resources than their larger counterparts, the informality, flexibility, and autonomy of small-state diplomats can offer substantial advantages in negotiations and institutional settings.
Singapore, which has chaired it since its inception, should seek to institutionalize the body and host a permanent secretariat and pursue a phased integration plan.
- FOSS Digital Economy Agreement mirroring DEPA modules.
- Common market for services, liberalizing logistics, finance, and professional mobility.
- Selective goods liberalization—pharmaceuticals, specialty foods, sustainable textiles—once trust is built.
Beyond development dividends for small states, a formalized FOSS would amplify Singapore’s standard-setting influence across the Caribbean, the Pacific, and small European economies. Moreover, it would also serve to overcome the significant structural and capacity barriers that many small states encounter in diplomacy and policymaking in the United Nations and on the global stage in general.
Pragmatic Roadmap (2025-2027) & Risk Management
| Period | Milestone | Outcome |
| Q3 2025 | File BRICS Partner bid | Joint working group on green-finance taxonomy |
| Q4 2025 | ASEANAUK scoping study in Singapore | Tariff-schedule template and regulatory-gap analysis |
| Mid-2026 | FOSS ministerial & secretariat launch | Draft FOSS DEA by year-end |
| 2026/2027 | MCSFTA enters into force; modular talks across all tracks | Independent ratification of digital chapters, followed by services and goods |
The modularity of each arrangement allows wins. Even if politics stalls one strand of the entire configuration, progress can still be achieved on other elements of such an arrangement. However, the next part comes with navigating the geopolitical turbulence that leading such an initiative requires. For instance, Singapore’s historic ties with Western capitals could be stressed through such moves. However:
● China’s concerns are eased by framing BRICS partner status as a complement to Singapore’s role in the RCEP.
● EU unease at FOSS exclusion is mitigated by offering observer seats and interoperability with EU digital regulation.
● US scrutiny is addressed by positioning each Digital Economy Agreement as high-standard, not rival, to the Indo-Pacific Economic Framework.
Narrative discipline, achieved through clear and coherent messaging, transparent consultations, and public dashboards tracking commitments, can help preempt misperceptions. This approach aligns with Singapore’s traditional foreign policy of adhering to principles, maintaining neutrality, and acting with enlightened self-interest.
Strategic Payoff
Woven together, the CPTPP (14% of global GDP), the RCEP (32%), BRICS (39%), the MCSFTA, and a prospective ASEAN-UK corridor position Singapore at the intersection of trade flows that encompass over half the world economy. By chairing working groups on data, carbon, and finance across these frameworks, Singapore transforms technical expertise into lasting diplomatic capital. Diversified supply chains further insulate the city-state from geopolitical fractures and fragmentation.
Singapore’s first generation of political leaders demonstrated that openness and credible rules could elevate a small island into a global hub. Six decades later, this formula remains relevant, though the context has shifted as the trade system fragments into overlapping spheres.
By bridging BRICS, hard-wiring the Anglo-Pacific, linking South America to ASEAN, and empowering small states, Singapore can ensure that the next wave of globalization—both physically and digitally—flows through its port on terms it helps to define. The opportunity is clear, and the race to shape the rules has already begun.
