Expansion plans are on hold.
Businesses in Singapore were less keen on taking on foreign debt in 2015, as escalating economic woes dealt a blow to the overseas expansion plans of most companies.
According to the Singapore Commercial Credit Bureau (SCCB), overseas credit searches by local businesses slid by 19.13% in 2015, extending a 12.83% contraction in 2014.
SCCB noted that the decline was in tandem with shrinking exports. A comparison between IE Singapore’s latest export figures and SCCB’s findings showed that 9 of the 20 most searched countries matched those in IE Singapore’s list of top 10 exporting countries excluding EU-28 countries, with a further 4 matching the top 5 for 2015
“Over the past year, we have seen a visible decrease in overseas credit searches by Singapore companies, as firms are more cautious and have scaled back their overseas expansion plans given the global uncertainties and tougher economic conditions,” said Audrey Chia, SCCB’s Chief Executive Officer.
However, credit searches made by foreign companies on local firms have moved in the opposite direction, rising significantly by 36.97 per cent over the past year from 2014 to 2015. EU-28 accounted for the highest proportion of credit searches done on Singapore companies, followed by North America and East Asia.
“Our findings also revealed that foreign searches on local companies have increased which points to the fact that foreign investment interest in local markets has remained strong,” she added.
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