SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE AND INDUSTRY, AT THE OFFICIAL OPENING OF PROCESSCEMASIA 2010, HELD ON 5 OCTOBER 2010 AT SANDS EXPO & CONVENTION CENTRE

Mr. James Goh, President, Association of Process Industry

Distinguished Guests,

Ladies and Gentlemen,

Good morning.

Last year, the energy and chemical sector contributed about one third of Singapore’s total manufacturing output and helped to maintain our position as a leading global energy and chemicals hub. The biopharmaceutical sector also fared well, as its output in 2009 helped to substantially soften the impact of the recession on our overall GDP. For that year, the sector accounted for 8.5 per cent of manufacturing output. Our government will continue to position Singapore as a focal point for energy, chemical and biopharmaceutical production in Asia to meet the increasing demand for relevant raw materials and finished products in this rapidly growing region.

Singapore will continue to differentiate itself and build upon the advantages and strengths that it has acquired over the years. To attract more chemical investments, we have successfully built upon our model of an integrated “plug and play” environment on Jurong Island. The next phase will be to focus on the “Jurong Island v2.0” initiative which aims to achieve new levels of competitiveness and environmental sustainability for operations on Jurong Island.

For the biopharmaceutical sector, government agencies like the Economic Development Board, JTC Corporation and Singapore Workforce Development Agency, or WDA, are working closely together with the Biopharmaceutical Manufacturers’ Advisory Council to further improve the infrastructure at Tuas Biomedical Park as well as to enhance workforce productivity, manufacturing efficiency and cost competitiveness.

Process supporting industry has been gaining prominence

The process supporting industry has been gaining prominence over the years. It has supported the construction and maintenance for new and expanding refineries, chemical plants and biopharmaceutical manufacturing facilities in Singapore. The industry is starting to grow beyond simply supporting the MNC plant owners. Instead we now see more process companies striking out on their own in the region to tap new growth opportunities and offer unique services.

I am glad to know that three Singapore-based companies - HSL Constructor, Mun Siong Engineering, and FRP Products - recently formed an alliance to target potential projects in Vietnam. This is following a business mission jointly organized by ASPRI and the Singapore Chemical Industry Council (SCIC). I understand that they will be signing a Memorandum of Understanding (MOU) later this morning. This collaboration is a good example of how companies can team up to venture into new markets with a differentiated value proposition from other competitors. By working together, they can leverage on one another’s strengths to provide a one-stop solution to clients.

The market landscape has changed tremendously in recent years. The major oil companies are expanding throughout the region to meet the growing energy needs of fast growing economies like China and India. It is a huge market out there and companies should not miss this window of opportunity. In order for Singapore process companies to exploit overseas business opportunities, they will need to build up their capabilities and move up the value chain to offer higher value-added services.

In addition, IE Singapore has several programmes to help companies build their human resources, design, and branding capabilities. Companies can also tap on IE’s strong global network to set up their overseas presence, explore potential project opportunities and gain business contacts.

At the same time, it is necessary for the industry to learn new ways of doing business. MNC clients are starting to treat engineering, procurement and construction (EPC) contractors more and more as value-adding strategic partners, instead of just service providers. By improving their capabilities and becoming more professional and efficient in what they do, process companies will be better accepted as strategic partners by their clients. The benefits are two-fold. First, our companies can have the opportunity to handle larger and more complex projects. Second, they can also go where their MNC clients are expanding. The challenge then for our companies is to serve their clients so well that they get invited to venture together with their MNC clients anywhere in the world.

Productivity focus

ASPRI too has been actively supporting the industry in capability building and productivity. I understand that ASPRI is in the process of launching three new innovation and productivity courses for its members through its training arm, the Institute of Process Industry (IPI). You have also included two papers on productivity in today’s conference.

The industry’s response has been very encouraging. I am pleased to note that IPI is working with the WDA to implement a series of Workforce Skills Qualification, or WSQ, innovation and productivity improvement programmes. One such effort is the WSQ certificate and higher certificate in process technology to be launched by ASPRI and WDA in December this year. The programme aims to upgrade 360 maintenance technicians and Quality Assurance or Quality Control inspectors.

By enhancing their capabilities, increasing their productivity and internationalizing their businesses, Singapore’s process companies will be in good stead to grow into international players such as Rotary Engineering, PEC, Hiap Seng, and Hai Leck.

On this note, I congratulate ASPRI for organizing this event and taking up the challenge to lead industry growth. I declare ProcessCEMAsia2010 open and wish all of you here a successful event. Thank you.