While some businesses may choose to relocate their large-scale fulfilment activities for slower moving goods to optimise costs, Singapore remains a critical node for companies’ regional distribution strategies. Mr Rasmussen explained that Singapore is the preferred hub for value-added services, high-value and time-critical cargo, and rapid market access. Singapore is a global gateway to Asia, with major cities in the region accessible within a seven-hour flight. In 2024, Singapore’s Changi Airport handled 67.7 million passengers and 366,000 aircraft movements. More than 7,200 flights depart each week – close to one every 80 seconds.
Furthermore, Mr Wong noted that Singapore’s extensive network of 29 free trade agreements (FTAs) helps businesses navigate today’s complex trade environment by providing more avenues to reach new trading partners. He said: “Given the current state of global trade, these FTAs enhance our customers’ trade opportunities offering them greater flexibility for both importing and exporting goods”.
Singapore’s strong connectivity networks are augmented by the growing number of free zones in the JS-SEZ. DHL highlights that businesses with Regional Distribution Centers (RDCs) and Global Distribution Centers (GDCs) in Johor can now move goods across the border into Singapore duty-free, eliminating the traditional cash-flow burden of upfront tax payments.
UPS recently enhanced its services in Johor with the opening of a new package centre in Senai and bonded warehouse at Senai Airport. The warehouse allows businesses to store inventory without immediate payment of duties and import taxes, providing the ability to respond quicker to customer orders and more flexibly manage regional stock levels while ensuring fast and cost-effective distribution to Singapore and beyond.
2. Streamlined cross-border trade and customs
Singapore and Malaysia are committed to making it easier and faster for businesses to move people and goods across borders. Several initiatives are already delivering benefits, such as passport-free QR clearance to enhance the flow of people and streamlined customs procedures to improve cargo flow. A single transshipment permit, for instance, has been launched by Singapore Customs for land intermodal transhipments, enabling goods arriving by truck from Malaysia to be efficiently transferred onto vessels or aircraft in Singapore for global export. This halves the number of permits needed from two to one, reducing processing time by 50% and saving the S$40 fee that previously had to be paid for each import and export permit application.
KN is seeing tangible benefits from these improvements across its operations in Singapore and Johor. In Singapore, KN operates six sites, including its Asia-Pacific headquarters and three fulfilment centres spanning over 75,000 sqm. In Johor, KN has two sites: an office in the city centre and a combined office-and-fulfilment centre at Tanjung Pelepas Port.
Mr Rasmussen, Managing Director, KN Singapore and Malaysia, said: “Our experience with customs clearance and permit processing has been encouraging. Procedures have become noticeably faster and more efficient. One of the most common misconceptions is that the border between Singapore and Malaysia is always congested, making efficient truck crossings difficult. In reality, with proper planning, cargo movements can be managed smoothly.”
