![\"TikTok](\"https:\/\/cassette.sphdigital.com.sg\/image\/businesstimes\/82090a061f4630eeb61598e0fcba03c95e667866cc8c58fc3fba7473ddef0285?w=960&dpr=1&f=webp\")
<\/a><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n\u201cThe Singapore brand is trusted worldwide. Singapore is valued for its international flavour, neutrality, and is culturally easy for Chinese firms and their expats to adapt to,\u201d said Maybank China economist Erica Tay.<\/p>\n
\u201cWith a whopping 28 free trade agreements, it is also a good base from which to grow markets outside China.\u201d<\/p>\n
But that advantage has also left Singapore on a tightrope, as the US steps up its scrutiny over Chinese firms and as some of those foreign entities have been involved in criminal activities.<\/p>\n
Singapore-based data centre firm Megaspeed, which split from a Chinese gaming firm in 2023, faces a US probe for allegedly diverting Nvidia chips used for AI.<\/p>\n
The Republic also had its biggest money laundering case involving foreigners of Chinese origin in 2023, and is investigating a conglomerate, owned by a Cambodian citizen of Chinese origins and accused of running vast scam centre operations.<\/p>\n
The US Department of Commerce and China\u2019s Ministry of Commerce did not respond to requests for comment. Reuters has asked the Singapore government for comment.<\/p>\n
Too big to hide<\/h2>\n
While a relocation in theory offers businesses more flexibility in managing tariffs, export controls and other protective trade policies, such moves do not guarantee firms freedom from political or regulatory heat.<\/p>\n
Fast fashion firm Shein and short video platform TikTok, among the early movers to Singapore, notably failed to shield their operations from Western scrutiny.<\/p>\n
Shein ran into political opposition in the US and the UK over its efforts to go public there and also had to seek Beijing\u2019s nod for its listing plans, despite having moved its headquarters from Nanjing to Singapore.<\/p>\n
It is now seeking China\u2019s blessing for a stock market debut in Hong Kong, and reportedly considering relocation back to China.<\/p>\n
TikTok, owned by China\u2019s ByteDance, saw its Singaporean CEO Chew Shou Zi repeatedly grilled over his links to the Chinese government at a Congressional hearing in Washington in 2024.<\/p>\n
ByteDance, which is required to sell its US operation to a consortium of American and global investors to meet national security requirements, signed off on the sale deal, TikTok said on Thursday (Dec 18).<\/p>\n
A failed effort by Yuxiao Fund, a Singapore-registered Chinese investor, to boost its stake in Australian rare earths miner Northern Minerals in 2024 due to its China link also highlights the limits of being based in Singapore.<\/p>\n
Experts argue the strategy mostly works for smaller firms but provides less wriggle room for big businesses.<\/p>\n
\u201cIt\u2019s the low-profile entities like family offices and trading companies which tend to have an easier time avoiding attention,\u201d said Chong Ja Ian, political scientist at the National University of Singapore.<\/p>\n
Some have already taken note of the growing scrutiny.<\/p>\n
Dou Changlin, the chief operating officer of Shandong Boan Biotechnology, which provides clinical services for global drugmakers, said its Singapore subsidiary is used to fund the company\u2019s US operations.<\/p>\n
While the structure has helped it meet funding needs from Singapore, not from China which has stepped up scrutiny of capital flows, Dou cautions US authorities could eventually draw a connection with its Chinese parent company.<\/p>\n
\u201cWe are very small in the US, I don\u2019t think we\u2019re on the radar of the US government yet,\u201d he said. REUTERS<\/p>\n
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Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter.<\/span> Delivered to your inbox. Free.<\/p>\n<\/div>\n<\/div>\n<\/div>\n
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