Speech by Mr Lee Yi Shyan, Minister of State for Trade & Industry and Manpower at the Association of Process Industry (ASPRI)’s Prosperity Lohei cum Annual Dinner on Wednesday, 24 February 2010 at 8:00pm @ Marina Mandarin Ballroom

Mr James Goh, President of ASPRI

ASPRI members

Distinguished Guests

Ladies and Gentlemen

Introduction

新年快乐,虎年生威! I am happy to join you this evening for ASPRI’s Annual Dinner.

Importance of productivity strategy

Minister for Finance, Mr Tharman Shanmugaratnam announced two days ago a S$5.5 billion national initiative to boost productivity. Essentially, to secure the next phase of economic growth, we need to make a decisive shift to create value based on the application of skills, productivity and innovation.

To make the transition to a productivity-driven economy, our industry, workforce and government must work together in a concerted manner. ASPRI as an industry association is well placed to play a lead role in rallying their members to consider sectoral initiatives in capacity building and productivity enhancement.

The developments at ASPRI

In fact, we are not starting from ground zero in helping industries with capacity building. Over the past five years, the Local Enterprise and Association Development (LEAD) Programme jointly managed by IE and SPRING Singapore has gained traction in supporting our enterprise growth and industry competitiveness. There are currently 22 associations embarking on some $89 million worth of projects to boost their industries’ performance.

ASPRI was among the pioneer associations to leverage on the programme. In May last year, I joined ASPRI, IE and SPRING on a business mission to the Middle East. We visited Saudi Arabia, Qatar and the UAE, and established useful contacts with potential business partners. I was told that a few months later, one company had successfully set up an overseas office in Doha, Qatar. Another company established a manufacturing presence in Damman, Saudi Arabia while a third company started a joint venture with a major local contractor on projects there. A good job to all involved in initiating good linkages with the Middle East. I hope to hear of more developments this year.

In the Budget speech on Monday, Finance Minister also shared our plan to grow globally competitive companies. One key avenue is through internationalization. SPRING, IE and EDB have been supporting our companies in areas such as capability development, internationalization and financing.

The Government will further boost our efforts to help local companies grow overseas, through three major thrusts -(1) the introduction of the $250-million Partnerships for Capability Transformation (PACT) programme to help local companies develop competencies needed to meet stringent manufacturing quality and certification requirements; (2) the Government will commit $100 million over 5 years to scale up its support for business associations to drive productivity at the industry level and to facilitate international market access for their members; (3) the Government will help support the flow of talent to SMEs by committing $45 million over 5 years to enhance SPRING’s Business Leaders initiative. More details will be made known at a later date.

I am also looking forward to ASPRI’s second Process CEM conference and exhibition this year. I was told that ASPRI had managed to rope in 120 exhibitors and secured $15 million in sales at its inaugural event in 2008. This year, ASPRI is targeting participation from some 150 exhibitors. I believe this event would be a good opportunity to showcase your company’s capabilities to potential customers, and to build business networks with overseas players.

At the enterprise level, we have been supporting several ASPRI members to upgrade their capabilities and at the same time boost productivity. Let me quickly share with you three examples. One company developed its own conveyor belt system to remove sludge from oil tanks, thus reducing its reliance on manual labor by 60%. By embarking on innovative product development, another company built its own decoking system for pipeline cleaning. The new locally-made system, which costs 20% less than existing equipment in the market, is more compact and can be quickly deployed onsite. Lastly, by adopting new technology, a company developed a customized engineering software system to boost its design capability, thus resulting in 90% reduced rework for its steel structure fabrication.

The recently announced Budget speech also revealed the introduction of broad base tax incentives to boost productivity. Going forward, I hope more companies will find greater incentive to automate and innovate and thus spur more broader range of innovative activities in our economy.

Conclusion

Moving forward, productivity and capability improvements will be a key priority for the industry to gain greater competitiveness. ASPRI could look into new ways to strengthen the capabilities of their members, enhance the professionalism of the industry, raise skills level, and improve industry practices and techniques. Likewise, I hope that ASPRI members continue to participate actively in their programmes and initiatives, and explore new business opportunities beyond Singapore. I would like to wish all of you a year of vitality, courage and roaring accomplishments ahead.

Thank you.