SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE AND INDUSTRY, AT THE OPENING CEREMONY OF MITSUI CHEMICALS’ 2nd TAFMER ELASTOMER PLANT ON TUESDAY, 13 JULY 2010, 1900 HRS AT THE MARINA MANDARIN HOTEL

Your Excellency Mr Makoto Yamanaka, Ambassador of Japan to Singapore

Mr Toshikazu Tanaka, President and Chief Executive Officer, Mitsui Chemicals

Distinguished guests

Ladies and gentlemen

Good Evening

Introduction

I am pleased to join you this evening to celebrate the opening of Mitsui Chemicals’ 2nd TAFMER Elastomer plant on Jurong Island.

Significance of the TAFMER plant and the Mitsui-Singapore partnership

This project marks yet another milestone in the longstanding partnership between Mitsui Chemicals and Singapore.　Mitsui Chemicals set up its first operations in Singapore in 1966 to manufacture adhesive resins. Since then, Mitsui Chemicals’ growth in Singapore has mirrored Singapore’s development as a global chemicals hub. Not only has it made Singapore its key manufacturing base outside of Japan with investments amounting to over S$1 billion, Mitsui Chemicals has also made Singapore its headquarters for the Asia Pacific and Middle East region. More recently, Mitsui Chemicals has made Singapore an integral piece of its innovation and talent attraction strategy through the establishment of an R&D centre and the launch of the Mitsui Chemicals scholarship programme. We are indeed proud to have built up such a strong partnership over the years.

Mitsui Chemicals’ TAFMER elastomer is a high-value, lightweight resin modifier that improves impact resistance and flexibility in moulding materials. It has a wide variety of applications, from car bumpers to food packaging materials. The new S$280 million plant on Jurong Island is Mitsui Chemicals’ fifth, globally, and it will be the company’s most technologically advanced yet. The TAFMER elastomer plant will incorporate the latest catalyst and process technologies, creating value and enhancing productivity by allowing higher and more differentiated grades of products to be made.

With its start-up, Singapore will account for two-thirds of Mitsui Chemicals’ global elastomer production capacities. Being in Singapore, Mitsui Chemicals is in a strategic position to access and tailor products to meet the specific needs of the fast growing Asian markets such as China, India, and South East Asia.

Positioning Singapore’s chemical industry for further growth

The chemicals industry contributed about one third of Singapore’s total manufacturing output in 2009 and will continue to be an important pillar and key driver of our economy. Therefore, we are committed to widening Singapore’s leadership in this industry. Of critical importance is through the focus on high value specialty products, like TAFMER.

In addition, we will need to continually differentiate ourselves and build upon Singapore’s current strengths. The success of Singapore’s chemicals industry thus far has been built upon the creation of an integrated ‘plug and play’ environment created on Jurong Island. Moving forward, we will need to further deepen these strengths and also develop new differentiating advantages. This will be the focus of the ‘Jurong Island v2.0’ initiative, a whole-of-government effort being undertaken in close cooperation with the industry to achieve new levels of competitiveness and sustainability for operations on Jurong Island. I understand from my EDB colleagues that when President Tanaka first took on his new appointment, he challenged all his staff to embody the spirit of ‘nobushi’[1], which is to think out of the box and be bold in your ideas. That is the same spirit we will need for ‘Jurong Island v2.0’, and I certainly look forward to Mitsui Chemicals’ partnership in helping us make it a success.

R&D as a Key Driver

The latest technology that will be found in this plant is aligned to Singapore’s continual push into higher value activities. And we recognise that for us to remain competitive, a technology or R&D engine for the chemicals cluster is essential. This will allow us to move from being a fast implementer of technology to being the first implementer and eventually a creator of new technology. This focus on innovation is in line with our commitment to grow the overall R&D spending in Singapore to 3.5 per cent of our GDP by 2015. We are seeing growing interest from technology leaders to undertake R&D to spearhead development of innovative, high value-added products. In addition to Mitsui Chemicals’ R&D centre in Singapore, companies like Bayer Material Science and 3M have also recently set up R&D facilities specialising in areas such as functional films, coatings and biomedical applications.

We are also looking at enhancing the sustainability of the chemicals industry through R&D in emerging areas such as biomass-to-chemicals conversion as well as carbon capture and utilisation. The ability to utilise biomass as a chemical feedstock will help reduce dependency on petroleum-based products as a raw material. Our geographical position in the middle of a region rich in biomass will present interesting new opportunities for companies.

In addition, the availability of concentrated streams of CO2 on Jurong Island, could present exciting opportunities. Companies can leverage our ‘plug and play’ environment and catalysis capabilities, to develop new technologies that can convert CO2 into useful products, at the same time helping to reduce our carbon footprint.

Biomass-to-chemicals conversion as well as carbon capture and utilisation are areas that would be of keen interest to Mitsui Chemicals, given the business potential as well as your focus on environmental and social responsibility. Already, Mitsui Chemicals has established basic technologies to produce methanol from carbon dioxide as well as chemical products from non-fossil and non-edible raw materials. We look forward to further collaboration and partnership with you in these new areas.

Conclusion

In closing, I would like to extend my heartiest congratulations to the management and staff of Mitsui Chemicals on the opening of the 2nd TAFMER Elastomer plant. We appreciate your trust and confidence in Singapore. Thank you for the significant role that you have played in the development of our chemical industry, and I would like to assure you of our continued partnership and support for the future. Thank you.