Singapore is emerging as a magnet for an army of e-commerce and IT executives and technicians from China, drawn by the sheer size and growth prospects across Southeast Asia.
Young consumers and new technologies are bursting on to the scene throughout the sub-continent and Chinese specialists and entrepreneurs have made a beeline to set up shop in Singapore in recent years.
Those who missed the boat of China’s explosive growth of its tech bonanza in the past decade are increasingly drawn to Southeast Asia, whose internet and e-commerce sector is about to get off the ground.
The talent flow from Beijing, Shanghai and Shenzhen to Singapore is gaining momentum, according to China’s leading tech website Zhongguancun Online, based in the Chinese capital city’s eponymous tech district, as well as Singaporean papers.
In May 2020, Alibaba shelled out 8.4 billion yuan ($1.3 billion) to take over floors in one of Singapore’s tallest office buildings near Marina Bay to house the expanding team of Lazada, one of the region’s largest e-commerce platforms. Tencent, a key backer of Lazada’s archival Shopee, also runs its business which stretches across the ASEAN bloc from the city state. In May, ByteDance named a new CEO of TikTok, Shouzi Chew, who now oversees the short video app’s global operations in the Lion City and likes to upload clips about views of verdant greenery and Singapore’s glittering skyline from his office.
Also setting off for Singapore and Southeast Asia are experienced developers and managers leaving their plateauing careers at established Chinese tech firms. They move to up-and-coming players in Singapore in search of opportunities to get in on the next big thing in the region’s economic and commerce digitization.
The backdrop is the share price of SEA, the New York-listed parent of Shopee, which has surged from less than US$20 in 2019 to about US$300 in recent weeks.
Peng Zhefu, the former chief technology officer of Chinese software developer Kingsoft and popular social networking and content-sharing platform Douban, decided to pull up stakes to move to Singapore in 2018.
Now running a unicorn tech start-up in the city, Peng told a forum on Beijing’s Belt and Road Initiative in March that he found during his tours across Southeast Asia that even many youngsters in tumultuous border towns in Myanmar had cellphones, mostly from Chinese makers like Xiaomi, Oppo and Vivo, and many of them found their initiation into the internet and online shopping a fascinating experience.
Peng’s conclusion was that the potential of close to 700 million young people across Southeast Asia would guarantee the growth of Chinese tech giants for the next decade, when the domestic market was becoming saturated. He said Singapore would be the central command and testing grounds for new strategies and business models to explore their practicalities in the region.
From their headquarters not too far away from each other in the Lion City, Shopee and Lazada are replicating tactics proven to be successful in China and applying them in the region, following Tencent and Alibaba’s de-facto takeovers of both platforms.
Singapore’s drawcards such as cultural affinity, good education and healthcare as well as the government’s supporting policies are also attracting many. The government’s Tech Pass visa regime granting long stays appeals particularly to overseas talent facing travel and entry restrictions elsewhere.
China’s emerging “glut” of IT graduates who major in computer science, e-commerce and related disciplines as growth is peaking off is also pushing some to seek opportunities in Singapore and Southeast Asia.
Yet there are not without complaints among the Chinese descending on the city.
Some Chinese IT technicians say they have a hard time “adjusting downward and backward” to the city’s, and broadly, the entire region’s “rudimentary” app testing and development, payment and settlement methods and supporting infrastructure like logistics and delivery services, according to Zhongguancun Online. They also feel Singapore’s pace of work and living is “too slow.”
The Straits Times also quoted Singaporean Prime Minister Lee Hsien Loong as saying that the leader felt like a “rube” – naive and inexperienced – after witnessing the freewheeling e-commerce development and its plethora of applications like cashless payment during his visits to China.
Boardroom tussles and cultural conflicts are becoming common as more Chinese parachute into key positions.
Singapore’s Chinese-language newspaper Lianhe Zaobao also reported the blowback from Singaporeans and staff of other nationalities at Shopee and Lazada, when their Chinese team leaders sought to introduce China’s notorious “996 culture” – working 9am to 9pm, six days a week – to try to make uncompensated overtime a new normal at these companies.
It is said that Shopee’s founder Forrest Li, also a Chinese immigrant, had to step in to address the grievances of local staff when Chinese managers tried to implement a more demanding key performance index appraisal regime cribbed from investor Tencent’s staff handbook. About 70% of Shopee’s staff in Singapore are now Chinese.
When Chinese tech firms with a global user base find themselves enmeshed in Beijing and Washington’s tech war and the West’s new legislations for more stringent data and privacy protection compliance, Singapore is again in their sights. Data centers and regional headquarters of Chinese firms have been blossoming there since 2018.
China’s Global Times reported in June 2020 that Alibaba, Tencent, ByteDance, Huawei, Kuaishou, China Telecom and China Mobile were among the growing number of Chinese tech companies pouring investments into Singapore for data centers and labs, as they sought to conform to tightened rules and ensure the peace of mind of their foreign users.
Realty consultancy Jones Lang LaSalle noted in a report that Singapore now boasts the largest cluster of Chinese tech firms outside Beijing, Shenzhen and Silicon Valley.
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