As more Singapore small and medium enterprises (SMEs) make inroads into the Chinese market, they can tap business opportunities in China in a number of ways, Singapore Senior Minister Goh Chok Tong said here on Friday.

Speaking at the 40th anniversary of the Singapore-China Business Association (SCBA), Goh said since Singapore and China established diplomatic relations 20 years ago, the two countries have developed strong ties at the government-to-government, business-to-business and people-to-people levels. Chinese Vice President Xi Jinping's recent visit has further broadened and deepened the bilateral cooperation.

He said Singapore companies are well-positioned to ride on China's growth, and economic cooperation remains the cornerstone of the bilateral relationship with China.

He cited two potential areas which Singapore companies can tap on: China's urbanization developments bring opportunities for companies with strengths in serving an urban population; China's inland second and third tier cities will emerge as new growth areas.

Goh encouraged Singapore SMEs to make full use of the China- Singapore Free Trade Agreement to lower business operating costs, and to leverage on provincial business councils and business associations to further business interests in China and venture into the Chinese market.

China and Singapore inked Free Trade Agreement in 2008. To further companies' interest of both sides, seven provincial business councils in China's Guangdong, Jiangsu, Shandong, Sichuan, Liaoning, Tianjin and Zhejiang have been set up.

China is now Singapore's third largest trading partner and the top investment destination. To date, more than 3,000 Chinese companies are operating in Singapore and close to 160 are listed on the Singapore Exchange.