Singapore manufacturers can count on partnerships and government support to navigate shifting global supply chains

Note: This piece was adapted from a feature by Chinese-language media organisation Lianhe Zaobao.

Despite trade disruptions, Singapore, a nation with a land area of just over 700 square kilometres, has continued to draw foreign investment and attract partnerships with multinational corporations (MNCs) due to its unique advantages.

These collaborations not only enable MNCs to diversify their supply chain risks, but also allow local enterprises to benefit from technology upgrades and global expansion.

The ongoing volatility in trade policy, which was triggered four months ago by US President Donald Trump’s tariff announcements, has not disrupted deliveries for Richport Technology, a Singapore-based firm. Each day, at the Singapore plant of VDL Enabling Technologies Group, a Dutch semiconductor manufacturing equipment supplier, delivery vehicles from Richport Technology make an average of three round trips for both collections and deliveries.
 

Chew Kian Zi, director of Richport Technology, told Lianhe Zaobao that the security guards at the entrance of VDL greet Richport’s employees whenever they see them, almost as if they were all from the same company. He said the teams from both companies communicate daily, and this frequency is especially important under current conditions.

“The tariffs don’t have a direct impact on us right now, but it’s the uncertainty that’s challenging,” said Chew. “The global semiconductor supply chain is quite complex. In the face of changes in tariffs, we have to maintain open and timely communications both ways, and make rapid adjustments when there are any changes. In the past, we have a common saying in the industry – ‘just in time’, now it’s ‘just in case’.”

Chiam Sing Chung, Managing Director of VDL Singapore, told Lianhe Zaobao that after nearly 20 years of working together, the two companies have built a strong mutual understanding. In the face of external challenges, they are able to support each other and devise strategies together to ensure operational continuity.

VDL is a supplier of parts and modules for semiconductor manufacturing equipment. Many of the components they work with must go through a surface cleaning process before assembly to enhance corrosion resistance and smoothness. This is what Richport specialises in. According to Chiam, a high level of precision and production speed are crucial in the semiconductor supply chain; both parties must be able to react quickly to iterations in downstream products and trust their partner’s competence. Both VDL’s Chiam and Richport’s Chew said that forging such a partnership requires time, and that even the pace at which they expand their operations must be synchronised.
 

VDL’s third plant in Singapore, at 20,000 sq m, is slated for completion this year. Chew said Richport is also expanding its operations and will move to a new plant of 12,077 sq m, which will be closer to VDL compared to its current site which is around 5,157 sq m.
 

Local Enterprises have an advantage in Country-of-Origin requirements

It is not uncommon to see MNCs like VDL partnering with local enterprises. With recent disruptions to global supply chains, such partnerships have become an effective shield against uncertainty for all parties involved.

Ang Yuit, President of the Association of Small and Medium Enterprises (ASME) Singapore, observed that partnerships between MNCs and local enterprises (including SMEs) have grown rapidly alongside the increasing volatility within the global supply chain. “The volatile environment is pushing MNCs to search for more resilient local partners,” he said.

He observed that when MNCs look to develop in the ASEAN markets, local enterprises often serve as an effective bridge, leveraging their experience in the region and knowledge of local supply chain networks to build trust in the sometimes complex markets of Southeast Asia.

“This model is also advantageous in Country of Origin management,” Ang said. “Local enterprises can help MNCs navigate complex trade regulations and enable them to benefit from Singapore’s relatively low tariff requirements, but such partnerships can easily be forced to change because of fluctuations in tariffs.”

Dr Xu Le, a lecturer in the Department of Strategy and Policy at the National University of Singapore (NUS) Business School, said that by working together, MNCs and local enterprises can consolidate and optimise resources, helping them to reduce costs, increase efficiency, and boost their resilience and competitiveness in an uncertain environment. “Given the current global economic volatility, enterprises working alone will find it difficult to deal with all kinds of headwinds and challenges effectively. It is better to find strength in numbers.”

Soh Leng Wan, Assistant Managing Director for Manufacturing at Enterprise Singapore, told Lianhe Zaobao that the agency aims to make Singapore a critical link in the global supply chain for MNCs. The upheaval to the global supply chain in recent years has demonstrated the importance of a diversified and flexible logistics system. Singaporean enterprises already have a strong foundation in the region and globally, making them ideal partners for MNCs seeking to build resilience.
 

Singapore’s favourable business environment a draw among MNCs

According to NUS Business School’s Dr Xu Le, besides a highly skilled, bilingual workforce and an open, business-friendly environment, Singapore’s unique advantage lies in its highly efficient and mature market mechanisms and relatively low cultural barriers or regional protectionism. Because of these factors, the cost of market entry for MNCs is also relatively low.

Dr Xu Le added that Singapore’s strategic geographic location compensates for its small local market. MNCs often view the country as a gateway to the rest of Southeast Asia, and forming a manufacturing partnership here helps to increase supply chain efficiency. A key advantage is proximity by air. Barring any delays, most Southeast Asian markets are within a four-hour flight from Singapore, and a seven-hour flight time will cover China, East Asia, Australia and other destinations. An additional advantage is the Singapore port, renowned worldwide for its efficiency.
 

Through its partnership with home-grown manufacturer Meiban, US-based Edwards Lifesciences saw savings in logistics time and cost, and an improvement in its speed-to-market. David Gan Tien Ngee, Global Supply Chain director at Edwards, said the company’s overall cost savings were between 20 and 30 per cent.
 

COVID Pandemic upheaval makes tariff impact more manageable

Edwards Lifesciences is the world’s leading manufacturer of heart valve products. In the second quarter of this year, 41.93 per cent of its revenues came from markets outside the United States, with Europe making up 24.68 per cent and Japan 6.22 per cent.

Singapore is the MNC’s largest manufacturing base and a vital part of its supply chain. Meiban is a key manufacturing partner for Edwards, and the two companies have already worked together for 15 years.

Edwards planned to expand its manufacturing base in Asia in 2010 and sought a partner in Singapore. Meiban, which had already brought in cleanroom technology, impressed with its high manufacturing standards and won the opportunity.

Wilson Tan, Operations Director at Meiban, said the partnership gave Meiban the opportunity to establish itself in the medical devices sector. “On top of the boost from Edwards’ reputation in the industry, the stringent quality standards they required from their partners have also significantly improved our company’s technical capabilities,” he said.

From supplying customised injection-moulded parts to developing automation solutions for Edwards, Meiban now works with Edwards’ R&D team on manufacturing design upgrades. This was made possible by the trust built up over the years and because of Singapore’s importance to the Edwards Lifesciences supply chain.

Tan said both sides currently meet at least once every two weeks. When starting on new projects, the frequency of meetings is increased to once a week so that both teams can stay updated on progress.

While there are a lot of uncertainties about tariffs, the strong partnership means neither Meiban nor Edwards feels overly anxious. Tan said the partnership had survived the pandemic crisis, which provides a measure of reassurance. Compared to the direct disruptions to manufacturing caused by the pandemic, the impact of tariffs on cost appears to be more manageable.

“The pandemic had a huge impact, but we understood each other’s business needs and could rely on close communication to get through the crisis,” he said.

Gan also referred to how closely the partners worked together during the pandemic, devising strategies to manage inventory, preparing raw materials in advance and implementing other measures to ensure business continuity. “This is where the partnership comes in: overcoming challenges together through open communication,” he said. “Tariffs won’t change our partnership strategy here.”
 

Government plays matchmaker to boost partnerships with MNCs

Dr Xu Le of NUS Business School said government support has been crucial in the partnerships between MNCs and local enteprises.

One example is the official Partnerships for Capability Transformation (PACT) scheme, which provides funding to attract foreign investment and incentivise MNCs to partner with local SMEs.

According to Enterprise SG and the Economic Development Board (EDB), PACT funding helps companies overcome some initial hurdles by defraying part of the costs incurred when MNCs and LEs enter a partnership.
 

To ensure the scheme remains relevant and responsive to industry development and evolving business needs, PACT’s coverage has also been expanded. Initially, only original equipment manufacturers (OEMs) and their suppliers were eligible, but the scope has since grown to include other manufacturing sectors and even non-manufacturing sectors. In 2024, the scheme was further enhanced to cover capability training, internationalisation, co-innovation, and other areas across different industries.

EDB and Enterprise SG also work together to link up potential partners, actively engaging with companies to explore the possibility of new collaborations. EDB works closely with MNCs to understand and identify their areas of demand that local partners may be able to address, while Enterprise SG facilitates connections with suitable LEs and sets them up for exploratory discussions. At the same time, industrial associations and other platforms are also used to help bridge communication between companies.

From 2024 to February this year, initiatives by the two agencies resulted in 17 new partnerships between MNCs and local companies.

Efforts to promote partnerships between MNCs and local companies are not recent; an interviewee for the article said they had successfully linked up with an MNC some 20 years ago with the assistance of EDB. Fong’s Engineering and Manufacturing was producing a variety of precision components for different industries 25 years ago and had yet to specialise in medical devices. This was a path they took only after forging a partnership with Stryker.
 

Clement Fong, Executive Chairman of Fong’s Engineering, recalled that the company was led by his elder brother back then. “EDB linked us up with Stryker and said they needed a supplier with experience in precision manufacturing and high quality control standards to help them produce components in Singapore.”

“Stryker’s technical director could speak Cantonese, which was a pleasant surprise, and a rapport was built from the start,” he said.

However, being brought together by rapport did not immediately translate into a smooth partnership. Around 2007, Stryker requested Fong’s to undertake some assembly work on top of manufacturing components. In the beginning, the inexperience of the Fong’s team led to a failure to meet speed-to-market requirements. Quality issues also kept cropping up.

Fong said Stryker sent a team from its US headquarters, made up of members from the R&D and manufacturing departments to Singapore to help the company set up its new production line. They even brought over operational experts to provide step-by-step guidance to Fong’s employees.

“After six to nine months, we gradually got the hang of it,” Fong said. “Today, our manufacturing standards exceed the market average.”
 

Looking back, Fong doesn’t see that period as particularly difficult. After a series of training and ironing out problems, the team from Fong’s Engineering is now able to meet all of Stryker’s high standards and has also attracted quite a few engineering talents to join them.

At present, the two companies are also planning to establish an R&D laboratory at Fong’s, focusing on the development of more endoscope-related medical devices. This would add more than 100 new jobs in manufacturing and R&D-related functions at Fong’s. In five years, the company’s revenue generated by the partnership with Stryker is expected to double.

Fong believes the collaboration has also contributed to Fong’s transformation, increasing its competitiveness. Today, the company’s manufacturing standards inspire confidence not just in Stryker but also among other MNCs in the medical devices sector, which has brought the company more opportunities to work with others.

“It’s not easy to get into the medical devices sector—the barriers to entry are very high. But once they accept you and see you as a reliable partner that has never caused any problems, the partnership can be a lasting one,” he said.

This has also given Fong’s Engineering more confidence in facing the tariff threat. Fong said that compared to other industries, the medical devices sector is bolstered by long-term market demand. Patients require surgery and treatment, and hospitals require the devices, which is unlikely to change dramatically due to tariffs.

Fong also revealed that based on their trust in Fong’s, clients are even considering shifting one of their production lines to Singapore, to be overseen by Fong’s. Furthermore, Fong’s will also be opening a new manufacturing base in Kaki Bukit in anticipation of the growth in demand.

Dr Xu Le said that local enterprises looking to work with MNCs must understand that the relationship has a lifespan. While grasping the opportunities to learn and grow, “Local enterprises should also work on improving their own supply chain systems and sales channels to strengthen their capability for dealing with the complex and ever-changing environment independently, and to build up their ability to deal with risks.”
 

Source: Lianhe Zaobao © SPH Media Limited. Permission required for reproduction.

Note: This piece was adapted from a feature by Chinese-language media organisation Lianhe Zaobao. EDB sought prior permission from Lianhe Zaobao to independently produce an English translation of "悉看大势：全球供应链频遭冲击 外企风暴中寻港湾 抱团本地公司开新局", which was published on 3rd August 2025.