SPEECH BY MR S ISWARAN, SENIOR MINISTER OF STATE FOR TRADE & INDUSTRY AND EDUCATION, AT THE NTUC OPEC CLUSTER NATIONAL DAY OBSERVANCE CEREMONY, 18 AUGUST 2010, 1015 HRS AT INFINEUM (SINGAPORE) PTE LTD

Mr Teo Lek Hong, CEO of Infineum (Singapore) Pte Ltd,

Mr K Karthikeyan, Chairman of OPEC Cluster of Unions,

Union Leaders,

Staff of Infineum (Singapore) Pte Ltd,

Ladies and Gentlemen,

Good morning.

Introduction

I am happy to join you at this morning’s National Day Observance Ceremony of NTUC’s Oil, Petrochemicals, Energy and Chemicals (OPEC) cluster.

Oil, Petrochemical, Energy and Chemical (OPEC) Cluster in Singapore – A Bright Outlook

The energy and chemicals industry is one of the largest contributors to Singapore’s manufacturing output.Last year, the petrochemicals and specialties sectors contributed close to S$58 billion of the manufacturing output. In terms of value-added, this translated to S$1.9 billion. The long term demand outlook for the sector is bright. By 2015, Asia is expected to account for 50 per cent of global demand for commodity chemicals.

Enhancing our Position as a Leading Petrochemical Hub

Singapore stands to gain much from this rising demand in Asia. And we intend to further improve on our position as one of the world’s top ten petrochemical hubs. We will do so by enhancing infrastructure development, creating competitive feedstock for petrochemicals, and moving up the value chain with advanced materials as well as specialty chemicals.

Critical mass is being built within the industry. ExxonMobil Chemical and Shell Chemicals recently completed the development of new crackers, which will increase Singapore’s total ethylene output from 2 million tonnes per annum (tpa) to 4 million tonnes per annum by 2012. We will also focus on high-value specialty chemicals to support other high-growth industries such as the clean energy sector.

More broadly, we will continue to develop Jurong Island which is home to many leading global petroleum and petrochemical companies.The Government has embarked on the planning and development of Jurong Island Version 2.0 which will optimize the usage of scarce resources such as energy, carbon, water and land. New competitive feedstock and logistics options will be explored.

We also aim to grow a highly skilled talent pool in this cluster. Institutions such as the Chemical Process Technology Centre (CPTC) currently ensure that we have a ready pool of workers equipped with the specialized skills needed by the industry. Expansion plans are now in the pipeline for the CPTC to deepen its range of programmes across disciplines, and widen its range of qualifications – from certificate courses to degree programmes.

R&D will also be a key factor in the next phase of development as the specialty chemical sector seeks to leverage on the creation of new products and solutions for sustainable growth and prosperity. It is, therefore, heartening that many companies have established their R&D centres in Singapore, which in turn can tap on partnerships with research institutes such as the Institute of Chemical and Engineering Sciences.

Importance of Tripartite Collaboration

But, as we have said many times before, and it bears repeating here today, ultimately, the growth of this or any industry is underpinned by strong and harmonious tripartite relations. Singapore’s model of tripartism has been forged through decades of cooperation among unions, employers, and government. The strong nexus between these three partners, which is founded on trust, mutual respect and open communications, has been crucial in helping Singapore weather the recent global recession which was the worst since World War II.

Productivity in the Energy and Chemical industry

These strong tripartite ties will be equally relevant and important as we seek to boost the national productivity rate from the current 1 per cent, to 2 to 3 per cent each year for the next decade. As one of the most productive sectors, I believe that the energy and chemical industry can lead the way.

Infineum is a good example.The company has worked closely with its 3rd party providers and partners to ensure that productivity is enhanced through a seamless supply chain. This has resulted in less manual intervention, higher equipment utilisation and lower costs. Infineum has also given recognition awards over the past decade to its employees for work that shows lower waste, higher capacity or an improved cost profile – in short, higher productivity.We must continue these efforts, maintain a workplace environment that is open to feedback and change, and constantly be on the lookout for new markets and business opportunities.

Productivity is all about finding ways to make our work processes more efficient and effective in order to create higher value products. It also means constantly upgrading one’s skills to perform higher value jobs.With our unique brand of tripartism and strong labour-management relations, I am confident that we will be able to push on with our productivity drive, expand the economic pie, and continue to create good jobs for our workers.

Conclusion

On this note, I would like to wish all of you a Happy 45th National Day.