Logitech Case

Logitech Case

Singapore, being an island country, has limitations of a small domestic market and inadequate natural resources. Thus it adopts an export driven industrialization policy - slashing trade barriers, encouraging free movement of goods and welcoming foreign investments.

Singapore’s exports add up to $302.7 billion f.o.b. (2007 est.) and imports are estimated at $252 billion. The significant items of import and export as well as its major trading partners are highlighted in the tables below.

Major exports 2007 % of total Major imports 2007 % of total
Electronic components & parts 25.5 Office machines 52.7
Telecommunications equipment 17.7 Petroleum products 20.3
Petroleum products 12.3 Telecommunications equipment 7.7
Scientific & optical instruments 4.9 Scientific & optical equipment 6.0

Leading markets 2007 % of total Leading suppliers 2007 % of total
Malaysia 12.9 Malaysia 13.1
Hong Kong 10.4 US 12.3
China 9.7 China 12.1
US 8.8 Japan 8.1

Singapore holds a comparative advantage in the production of electronics and components when compared to countries like The U.S. But we can go a step forward and say that the Hecksher-Ohlin Theory is most appropriate to describe Singapore’s trade patterns.
Singapore is endowed with factors such as:
• Strategic location
• Highly skilled labour
• Technological hub
• Government support
• Competitive economy
It makes up for the scarcity of natural resources by optimum utilization of its existing factors. For example, it has capitalized on its natural island beauty by turning it into an ultimate tourist’s paradise.
However, due to limited land resources, it imports items such as crude petroleum and food products.

In our final report, we will begin with an overall country overview with the aim to assess the way trade has developed in this highly liberalized country. We will bring out the government’s role in building the...

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