Singapore is testing site for China food firms

Lion City has key role in global expansion

- CLAIRE FU XINGHUI KOK

A woman passes an advertisement for a restaurant selling Chinese cuisine in Singapore on Friday.

(REUTERS)

A record number of Chinese restaurants and cafes have flooded Singapore over the past year, using the island as a test bed for global expansion as they escape pallid consumer demand, extreme price competition and super-squeezed profit margins back home.

Well-known firms such as Luckin Coffee and bubble tea major Mixue joined hotpot and mala restaurant operators in the post-pandemic surge overseas, hoping to draw on the cachet of the internationally oriented city-state in a trend that industry experts and executives expect to accelerate.

"It's really tough to operate in China now, so many brands are choosing to expand abroad," said Josie Zhou, overseas general manager of Hunan cuisine restaurant Nong Geng Ji, which picked Singapore for the first stage of its global push.

Persistent price wars are forcing Chinese food and beverage firms to explore new growth models abroad, said Joanna Jia, Singapore manager of bubble tea chain ChaPanda, which opened two franchisee tearooms in the city in July and plans two more.

Weak demand has stifled growth in China since the end of Covid-19 lockdown almost three years ago. A longtime property market slump and US tariffs on Chinese goods have exacerbated price wars in sectors as varied as food and beverages, e-commerce and autos, intensifying deflationary pressure.