A Silver Lining For Singapore’s Economy: A Big Jump In Foreign Direct Investment Confidence

Singapore has jumped five places from a year ago to reach the top 10 in the 2016 Foreign Direct Investment Confidence Index survey that was released earlier this month. The country had made the largest leap out of the all the other nations that are part of the study.

The survey’s conducted on global business executives by management consulting firm AT Kearney. The US and China, which held the top two spots in 2015, continued to head the list.

AT Kearney FDI survey
Source: AT Kearney

The survey also revealed that 31% of respondents are more optimistic about Singapore’s economic outlook for the next three years as compared to 2015. 15% of the respondents grew more pessimistic about Singapore’s three-year economic outlook.

For perspective, 32% of respondents have become more pessimistic about China as compared to 28% who have developed a more optimistic view. The US had topped the sentiments’ list with 42% being more optimistic and only 14% growing in pessimism.

AT Kearney’s survey also noted that Singapore’s Foreign Direct Investments (FDI) are likely to come from Asia Pacific investors and to be targeted at the IT sectors.

A Fool’s Take

Singapore’s central bank, the Monetary Authority of Singapore, said in its 27 April biannual macroeconomic review that a slow growth environment for the nation’s economy is expected to continue. Fears of lacklustre growth for Singapore may have weighed on the stock market, seeing as how the Straits Times Index (SGX: ^STI) has fallen by over 7% since 21 April to around 2,740 points currently.

Given this backdrop, AT Kearney’s 2016 FDI Confidence Index survey results for Singapore looks like a silver lining.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Ong Kai Kiat doesn't own shares in any companies mentioned.