SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE & INDUSTRY, AT SUMITOMO CHEMICAL’S CELEBRATION DINNER FOR THE OPENING OF ITS SECOND METHYL METHACRYLATE MONOMER (MMA) PLANT ON THURSDAY, 6 APRIL 2006, 7.00pm AT SHANGRI-LA HOTEL
Your Excellency Mr Takaaki Kojima, Ambassador of Japan to Singapore,
Mr Hideaki Watanabe, Director and Senior Managing Executive Officer, Basic Chemicals Sector, Sumitomo Chemical Company Ltd,
Good evening.Let me first extend a warm welcome to Mr Watanabe and your many guests and business associates who have specially flown into Singapore for this occasion.
It is my pleasure to be here with you today to celebrate the opening of your second methyl methacrylate (MMA) monomer plant. I understand that you also broke ground earlier this afternoon for your third MMA monomer plant and second MMA polymer plant, which is estimated to cost US$200 million to construct. Today is indeed a day for celebrations for Sumitomo and Singapore.
Sumitomo is a Longstanding Partner of Singapore
Sumitomo is a longstanding partner of Singapore. In 1984, the first chemicals showcase between Singapore and Japan was realised when Sumitomo led a consortium of Japanese companies to establish the Petrochemical Corporation of Singapore (or PCS), South East Asia’s first petrochemical complex here. The success of this venture did not come easy but we persevered and with Sumitomo’s support, PCS and its integrated complex of downstream companies continue to thrive today.This successful co-operation has paved the way for many other Japanese companies to follow.
There is Strong Growth in the Chemicals Industry
Today, JurongIsland is the centrepiece of our Chemicals Industry. It is home to more than 80 companies with manufacturing activities in oil and gas, petrochemicals and specialty chemicals.New companies like Ciba Specialties, Tate & Lyle and Horizon Terminals continue to join us, bringing added diversity and vibrancy to Jurong Island.Amongst the international community of companies on Jurong Island, Japanese companies are particularly well represented, accounting for one third of the entire group. What is important is that we all share a common vision of transforming Jurong Island into a global chemicals hub that is integrated, connected, secure and anchored on strong capabilities and technology.
From our humble beginnings, the Chemicals industry in Singapore has grown in significance.It took off in a major way when we began work on creating Jurong Island just over a decade ago. The output of this industry has almost quadrupled in the last 10 years, hitting $66.5 billion last year. Compared to 10 years ago, the Chemical industry’s share of total manufacturing output has more than doubled from a mere 15% to 32%, making it the 2nd largest contributor to Singapore’s manufacturing sector, after the Electronics industry.
Singapore is Committed to Manufacturing
These numbers only serve to reinforce our commitment to the Chemicals industry, and to manufacturing in general. Manufacturing creates tremendous value for the Singapore economy both directly and through its spin-offs.
Last year, the growth of the manufacturing sector of 9.3% outpaced the growth of the general economy of 6.4%. This underlines the importance of manufacturing as a key engine of our economy.While many sceptics question Singapore’s competitiveness in manufacturing, manufacturing’s share of Singapore’s GDP has continued to trend upwards, reaching close to 28% of GDP in 2005 from 23% of GDP in 1997.
The Singapore Government intends to keep manufacturing a significant part of our economy. We target to grow our manufacturing output to $300 billion by 2018.To do so, we will leverage on the strong foundation we have built and continuously exploit innovative new ways to provide value and stay relevant to companies as they move up the value chain.
Moving to Higher value-Added Engineering Products
Sumitomo has been continuously moving up the value chain in Singapore and Singapore has developed with Sumitomo over the years. For many years, we have concentrated on building a competitive petrochemicals industry through a strategy of integration. Companies like Sumitomo can leverage on the feedstock availability and the world-class logistics infrastructure on Jurong Island.
Moving forward, the integration strategy will continue to be one of our core strengths.However, we will also take a more focused approach and move our industry up the value chain to produce higher value-added products like engineering and designer polymers.This will involve leveraging on technology and innovation to develop processes and products that meet the needs of growth markets like the automotive, electronics and healthcare industries. Innovation and R&D capabilities will feature highly.This fits directly with Singapore’s increasing emphasis on technology and innovation.I know that Japanese companies are particularly strong in advanced polymers and materials and we invite you to join Singapore in growing this area.
MMA is a good example of an advanced material. Sumitomo is leveraging on its proprietary, globally competitive technology to produce MMA monomers and polymers for a myriad of applications like LCD light-guide sheets and thick optical panel applications.
Our Partnership with Sumitomo Continues to Grow from Strength to Strength
With the completion of the third MMA monomer plant, Sumitomo will be in a commanding position as the largest MMA producer in Asia. In Singapore alone, Sumitomo will have a total annual MMA monomer production capacity of 223,000 tons and total annual MMA polymer production capacity of 100,000 tons. This will make Singapore Sumitomo’s largest integrated MMA manufacturing site, supplying approximately half of its total capacity worldwide.
Conclusion
Mr Watanabe and all your colleagues at Sumitomo, we thank you for the level of commitment and trust that you have placed in Singapore. On behalf of Singapore, I reiterate our commitment to this invaluable partnership and look forward to its continued growth.
I wish you and all Sumitomo staff good health and success in all your future ventures.
Thank you.