Singapore and the European Free Trade Association (EFTA) have finalized the EFTA-Singapore Digital Economy Agreement (ESDEA), aiming to facilitate seamless data flows and boost digital trade between Singapore and EFTA member states (Iceland, Liechtenstein, Norway, and Switzerland). The agreement builds on the existing EFTA-Singapore Free Trade Agreement and sets out high-standard rules for cross-border data connectivity, committing both sides to prohibit unjustified data localization requirements and enable businesses to freely choose where to store and process their data. Personal data protection will remain a priority, with both parties ensuring transparency and compliance aligned with international standards.
The ESDEA supports end-to-end digital trade by accepting electronic versions of trade documents, promoting international standards for e-payment and e-invoicing, and prohibiting customs duties on digital transmissions. These commitments reduce operational costs, support easier market access, and foster greater innovation, especially benefiting small and medium-sized enterprises. The agreement also enhances the legal certainty and trust in digital systems, allowing companies to operate securely and efficiently across both regions.
To build trusted digital ecosystems, the ESDEA prohibits the forced disclosure of company source code and cryptographic information for market entry, and outlines cooperation on digital ethics and artificial intelligence. Both Singapore and EFTA will collaborate to strengthen cybersecurity, promote ethical commercial practices, and prevent deceptive conduct in electronic commerce.
The agreement supports cooperation in artificial intelligence, financial technology, and cybersecurity. In 2024, merchandise trade between EFTA and Singapore totaled approximately USD 8.4 billion, with pharmaceuticals as key imports to EFTA and organic chemicals, machinery, and clocks as exports to Singapore. Negotiations, initiated in February 2023, were led by Esther Hauert Wermuth (EFTA) and the directors of Singapore’s Ministry of Trade and Industry, Lai Shu Ying and Chua Shun Loong.
(Sources: EFTA, Open Gov Asia)
