Russia and Singapore: The 2023/24 Trade and Investment Dynamics

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By Emil Avdaliani

Amid the ongoing sanctions and growing trade tensions with the collective West, Russian businesses are looking for new markets. Singapore, with its unique investing advantages and strategic location, is especially attractive as the country is seen in Moscow as a door to the wider prosperous South-East Asian and ASEAN regions.

Yet Singapore joined the collective West in imposing sanctions (control of exports of military and technological goods to Russia and measures against Russian financial entities) against Russia in March 2022 following the outbreak of the conflict in Ukraine. Moreover, sanctions imposed on Russia by the West led to a freeze in business communications between Russian companies in Singapore due to problems with banking transactions. However, more recently, by late 2023 Singapore now seems to be less rigid about adhering to the sanctions regime against Russia. Nevertheless, different geopolitical perspectives still hinder closer economic ties between Moscow and Singapore. The latter remains tilted more toward the US and the collective West in general partly because of closer trade and investment ties, partly based on security threat perception.


In 2021, before the conflict in Ukraine, trade turnover between Russia and Singapore amounted to US$2.23 billion, representing an increase of 35.16% compared to 2020. In 2022 Singapore imports from Russia constituted US$2.29 billion. Major Russian export products to Singapore consist of mineral fuels, oils, distillation products, pearls, precious stones, nickel, copper and food products.

Another interesting item is naphtha which nearly tripled in terms of exports in the first quarter of 2023 and reached a level of 741,000 tons or 23% of Singapore’s total imports of the refined product.

Naphtha is commonly used as a solvent. It is used in hydrocarbon cracking, laundry soaps, and cleaning fluids. Naphtha is also used to make varnishes, and sometimes is used as a fuel for camp stoves and as a solvent (diluent) for paint. It is a hydrocarbon by-product.

What is interesting in this instance is that Singapore’s significant increase of Naphtha imports  followed the EU’s decision to ban Russian oil products from early 2023 and also fits into the overall Russia-Asia trade dynamics reported in the first months of 2023.  For example, in April 2023, Russia’s maritime exports grew to their maximum level since early 2022. The primary cause is considered to be Russian export increases to Asia, where from various locations – including Singapore as an ASEAN hub – it is being re-exported elsewhere. Russian oil and coal follow the same trail and mostly end up in India. Russian companies also plan to expand the scope of exports: thus in late 2022 the giant Russian cosmetics manufacturer Natura Siberica announced its expansion into the markets of the Indo-Pacific region which includes Singapore. It should be noted that as a member of ASEAN, Singapore has Free Trade Agreements with China and India.

Singapore serves as Russia’s largest trading partner within the ASEAN countries. The Southeast Asian country’s exports to Russia primarily include electronics, chemical products, and pharmaceuticals, and are of quite limited volume. In 2022, Singapore exported only US$182.68 million worth of products to Russia, from which electrical and electronic equipment accounted for the largest share (US$40 million). The second most important category consists of US$33.21 million worth of machinery, nuclear reactors and boilers.

Close trade ties between Russia and Singapore are built upon an agreement on a free trade zone signed in 2019 between Singapore and the Eurasian Economic Union (EAEU). This helped revitalize trade levels between Singapore and the members of the EAEU, which also includes Armenia, Belarus, Kazakhstan, and Kyrgyzstan.

For instance, in 2022, trade turnover between Singapore and Kazakhstan exceeded US$1.92 billion, an increase of 60% compared to 2021 ($1.16 billion) and this is some 17 times more that recorded in 2020.


Investments between Russia and Singapore are marked by significant activity from both sides. Overall, Russian companies have access to a variety of programs and initiatives created by the Singapore government to attract and support foreign investors. This includes tax incentives, research and development grants, and special free trade zones that facilitate trade and logistics.

Singapore’s sovereign wealth fund, GIC, has also in the past made significant investments in Russian entities like VTB Bank and Sibur Holding. On the other hand, the Russian conglomerate Rostec has engaged in partnerships with Singaporean companies in various sectors, including logistics and industrial automation. Singaporean Changi Airports International, together with the Russian Direct Investment Fund, manages Vladivostok International Airport as an air harbor operator.

These investments are part of broader economic ties that also include trade in goods and efforts to enhance connectivity and cooperation in digital economy and innovation. Related to this, the Memorandum of Understanding (MOU) was signed in 2019 to explore cooperation in the digital economy and another MOU in 2020 for the development of a joint technology and innovation business council.

One of the key areas of business for Russian companies in Singapore is the identification system for people, objects and animals. Russian companies offered a wide range of innovative solutions in the field of access control systems, RFID technologies and information security.

While the conflict in Ukraine and subsequent sanctions have shifted Russia’s trade dynamics, they have also impacted tourist routes. Singapore is one of the exceptions, where Russia had initiated direct flights well before 2022. Despite the growing economic ties, challenges such as the geographical distance leading to high transportation costs, longer delivery times, and differences in regulations and business practices still remain. Nevertheless, both nations have worked extensively showing interest in developing transport infrastructure projects such as the Northern Sea Route and the links between Singapore and Russia’s Far East ports. Once the Ukraine issue can be resolved, we can expect an almost immediate uptick in Russia-Singapore relations.

Emil Avdaliani is a professor of international relations at European University in Tbilisi, Georgia, and a scholar of silk roads.

About Us

Dezan Shira & Associates assist foreign investors into Asia and have an office in Singapore as well as the major ASEAN economies in addition to China and India. Please contact us at for advisory services and refer to our related guides below.  

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About Us

During these uncertain times, we must stress that our firm does not approve of the Ukraine conflict. We do not entertain business with sanctioned Russian companies or individuals. However, we are well aware of the new emerging supply chains, can advise on strategic analysis and new logistics corridors, and may assist in non-sanctioned areas. We can help, for example, Russian companies develop operations throughout Asia, including banking advisory services, and trade compliance issues, and have done since 1992.

We also provide financial and sanctions compliance services to foreign companies wishing to access Russia. Additionally, we offer market research and advisory services to foreign exporters interested in accessing Russia as the economy looks to replace Western-sourced products. For assistance, please email or visit