Viewed from the stormy shores of Brexit Britain, Singapore can seem like a shining beacon representing how things could be: simpler, cleaner and providing the perfect growing conditions for tech companies.
The city state has received extra attention recently, as UK tech giant Dyson recently announced that it was moving its global headquarters here. While that decision was stated not to be Brexit related, Theresa May’s government is expected to prioritise Asian markets in its post-Brexit trade policy.
So what is the true picture? Are Singapore and the surrounding countries of Southeast Asia building a regional marketplace that Europeans would find familiar, or is it heading for a different horizon altogether? And crucially, what role can British and European tech companies play in all this?
From a tech perspective, this region continues to be of interest to those seeking long term growth opportunities. In Dyson’s case, their move here seems to be more pull than push. Despite the baser UK press suggestions that an avid Brexiteer (James Dyson) is abandoning ship, none of Dyson’s 4,000 UK workers are expected to lose their jobs and the company is planning to spend £200 million on a new plant in Hullavington, Wiltshire.
The move seems to be motivated by proximity to manufacturing (mainly in Malaysia), engineering talent, significant financial incentives, and strong local demand for fans, vacuum cleaners and, one day soon, electric vehicles.
UK big business is already well represented by the likes of Rolls Royce, which has been in Singapore since the 1950s. BT also recently opened a new “global connectivity and cybersecurity” operations base, employing more than 300 staff.
Focus on Cyber
When it comes to cybersecurity, Singapore has been at the forefront of a recent round of new regulation across Southeast Asia.
The 10 governments of the Association of Southeast Asian Nations (ASEAN) are committed to introducing laws to encourage data driven activities, as demonstrated by the introduction of Singapore’s Cyber Security Act on the domestic front, along with the establishment of an ASEAN-Singapore Cybersecurity Centre of Excellence, with the aim of supporting members’ cyber strategy development, legislation and research capabilities.
The arrival of specialist cyber accelerator CylonLab underlined the early stage activity in the sector, which is already in the public consciousness after last summer’s cyber attack on SingHealth, which included the Prime Minister’s own health records being compromised.
Vietnam’s own Cyber Security Act, introduced on 1 January, may have taken what is seen by some as a more draconian approach, requiring tech companies to establish local offices and store data onshore.
Most recently, Thailand’s Parliament unanimously approved a controversial cyber-security law, granting far reaching powers to cyber authorities to enter private property in cases of actual or perceived cyber threats. While, on the face of it, the hastily approved new law brings Thailand in line with international cyber standards, critics fear that the sweeping powers given to the authorities risk being abused as elections approach.
Despite these concerns, the introduction of these new cyber laws does underline regional governments’ increasing focus on supporting their fast growing digital economies as a priority, raising awareness and laying the foundations for new entrants into the market.
Cyber companies with operations in the UK, Europe or the USA can build on their experience in other markets to play a part in these developing digital economies, when supported by strong local teams and a well defined strategy.
Octopus portfolio companies such as Digital Shadows and Behaviosec are good examples of British cyber companies that are already making a positive impact here. Beyond offering their cutting edge solutions to Asian customers, they can also play an active role in supporting a trusted, secure cyber-security environment in the region.
The Long View
This region has a population of 600-700 million, with a far younger demographic than Europe and, as mentioned in a previous post, countries such as Vietnam and the Philippines projected to lead the world in GDP growth over the coming decades.
The impact of ongoing US-China trade tensions, diverting more trade towards Southeast Asia, has also been an unexpected catalyst for growth.
Nonetheless, the development of key infrastructure, high speed internet connections, and a deeper talent base remain high priorities for governments eager to attract inward investment and accelerate the growth of the digital economy.
The recent appointment of Natalie Black as the APAC Commissioner for Trade underlines how seriously the UK is taking Asia. And today, world class British and European cyber and technology companies landing with a “how can we help?” attitude can help contribute to one of the most exciting growth regions in the world.