Singapore, New Zealand Sign Accord on Trade in Essential Supplies
Even under strain, trusted partners will keep faith with one another
By Ivan Lim
Former AJA President, Contributor to AsiaN
SINGAPORE: This is the complementary basis of the Singapore-New Zealand deal to safeguard their economies from the disruptions to the energy and food-related supply chains caused by the US-Israeli war on Iran.
The Agreement on Trade in Essential Supplies (AOTES), signed on May 4, legally commits the two countries to prioritise each other’s needs, including healthcare items as well as chemical and construction materials.
Singapore will see to New Zealand’s refined fuel requirements underpinning its agriculture and dairy industry that cater to the city-state’s food requirements.
Hailed as the first such legally enforceable accord, AOTES came into being after Singapore and Australia agreed in April to work towards a similar agreement to keep energy and essential supplies flowing in the wake of the US and Iran blockage of the Strait of Hormuz, affecting the transshipment of 20 per cent of the global oil and gas supplies -equivalent to around 20 billion barrels per day.
Visiting New Zealand Prime Minister Christopher Luxon and his Singapore counterpart Lawrence Wong who officiated at the signing of AOTES in Singapore underscored the mutual deep trust and understanding invested in the deal.
Noting that Wellington receives a third of its energy needs from the republic, Mr Luxon said: “Obviously, there are no export limits placed on New Zealand as a consequence of this agreement.
“Equally, we have said that in the time of crisis, should Singapore ever have a disruption of its food supplies, New Zealand will be there. We will absolutely be delivering on our end of the deal as well.” (Interview with the Sunday Times)
Singapore, which relies on more than 180 countries for its food needs, imports around 14 per cent of its food stuff from New Zealand, with dairy being the top item.
On its part, PM Wong said: We will noy shut each other out. Instead, we will work actively to keep trade moving,
“This is the first agreement of its kind for both our countries – and also globally. It marks another breakthrough, and it sends a very clear signal: Even under strain, trusted partners will keep faith with one another.”
Even while stocks for its oil refineries are hit by the closure of the Hormuz water-way, Singapore companies continue to get energy supplies from other countries and will be able to honour its commitments to partners.
Both leaders saw their bilateral pact as setting a model for like-minded countries to forge critical trade partnerships in the face of Trumpian go-it-alone geo-politics.
