SPEECH BY MR S ISWARAN, SENIOR MINISTER OF STATE FOR TRADE & INDUSTRY AND EDUCATION, AT THE BRITISH CHAMBER OF COMMERCE BUSINESS AWARDS 2010 GALA DINNER ON THURSDAY, 7 OCTOBER 2010, 2110 HRS, AT THE SHANGRI-LA HOTEL

His Excellency Paul Madden,

British High Commissioner to Singapore;

Mr Steve Puckett,

President, British Chamber of Commerce, Singapore

Mr Alan Goodyear,

CEO Global Transaction Services Asia Pacific, Royal Bank of Scotland, Title sponsor of the British Chamber of Commerce, British Awards 2010,

Distinguished Guests,

Ladies and Gentlemen, 

Introduction

Thank you for inviting me to this evening’s 11th British Chamber of Commerce Business Awards to honour business excellence achieved by British and Singaporean companies over the past year. Let me first extend my warmest congratulations to all the finalists. Many of you have made outstanding contributions towards deepening the economic partnership between Singapore and the UK.

The Importance of the United Kingdom to Singapore

Singapore and the United Kingdom (UK) share a long-standing and multi-faceted relationship that is underpinned by excellent economic ties. The UK is Singapore’s second largest foreign direct investor. There are more than 2,900 British companies in Singapore. Some of the notable ones include GlaxoSmithKline (GSK), Rolls-Royce, the Shell Group, Barclays, Diageo, Standard Chartered Bank, HSBC, BP and the Royal Bank of Scotland, who are the title sponsors of tonight’s awards.

The UK is also the top destination in the European Union (EU) for Singapore’s direct investment, with a stock of S$25.1 billion in 2008. This represents nearly three quarters of all Singaporean investment in Europe. Leading Singaporean investors in the UK include SembCorp, ComfortDelgro and Singapore Technologies.

Our trade ties are also robust. The UK is our 15th largest trading partner in the world. Last year, Singapore’s bilateral trade with the UK reached S$13.7 billion.It accounted for close to 16 per cent of our total trade with the EU, making the UK our 3rd largest European trading partner.

These longstanding and deep ties take on added importance against the backdrop of a rapidly changing global economic landscape. The US economy looks uncertain, fiscal measures to cut deficits in Europe may crimp growth, with the growth momentum in Asia offering a counterpoint

Tapping Opportunities in Asia

Growth of India and China

While the global economy appears to have entered a phase of weak growth, we remain optimistic about Asia’s prospects. Most Asian economies, in particular China and India, have emerged strongly from the economic downturn, and are poised to be important drivers of global growth in the coming decade.

A More Integrated ASEAN

Growth has also returned to Southeast Asia, in some cases exceeding pre-crisis levels. Notably, with the signing of the ASEAN Charter and the Economic Community Blueprint, a more integrated ASEAN will enable companies to operate seamlessly within the region.It is, therefore, important not to overlook opportunities in this region.

Opportunities for Bilateral Economic Collaboration

As a natural corollary of these developments, UK companies should continue to tap and leverage off Asia’s growth. And, Singapore can play a useful role in enabling global companies to expand their footprint in Asia. In the context of the UK and Singapore, I would like to highlight two main areas which can yield opportunities for bilateral economic collaboration.

(A) Collaboration in the Manufacturing Sector

The first is in manufacturing. Both the UK and Singapore have strong high value manufacturing sectors which are important components of our economies. There is potential for bilateral collaboration in three key manufacturing clusters.

i. Transport Engineering – Aerospace

The first is in transport engineering, especially in the fast-growing air transport sector. Singapore is the regional aviation hub in the fastest growing air travel market in the world. Our aerospace industry has grown to encompass a broad spectrum of air hub services and activities including maintenance, repair and overhaul (MRO), design, manufacturing and aviation services. Major global aerospace players such as Rolls-Royce, EADS, Thales and Safran have already chosen Singapore to base their manufacturing, R&D and engineering activities.

ii. Energy and Chemicals

The second cluster is energy and chemicals. As one of the world’s leading chemical hubs, Singapore has attracted a plethora of global players who have established operations here. As Asia becomes an increasingly important consumer of chemical products, Singapore will remain a strategic base for companies seeking to invest in Asia for the long run.

A case in point is Lucite International, the top global producer of Methyl Methacrylate (MMA), which has chosen Singapore as the location for its first Alpha MMA plant in the world.

iii. Pharmaceuticals & Biomedical Sciences

The third cluster is pharmaceuticals and biomedical sciences (BMS). Our focus on the industrial application of research, strong IPR regime and manufacturing capabilities combine to create the ideal platform for companies seeking a site to serve Asian markets. In June 2009, GSK opened a new S$600 million vaccine plant in Singapore, its largest investment in Asia.

I would like to encourage more UK companies to emulate the likes of Rolls-Royce, Lucite International and GSK to consider Singapore as the location to base their activities in these promising clusters to serve the growing regional markets.

(B) Building Economic Bridges

Beyond the development of our strategic clusters, Singapore is also deepening our economic linkages with Europe. The EU-Singapore FTA (EUSFTA) was launched with this objective in mind. Through the FTA, we hope to improve companies’ access to each other’s markets, and enhance the bilateral flow of services and investment.

Our aim is to shape an agreement that is responsive to modern business needs such as supply chain management and the globalisation of operations. Businesses like yours are important stakeholders in this endeavour, and we would welcome your ideas and thoughts on how we could construct an FTA that meets your business needs. We also look to the business community to lending your support for the early conclusion of the FTA.

Conclusion

In summary, there is great scope for Singapore and the UK to deepen our relationship in mutually beneficial ways. I realise that on this occasion and, in particular to this audience, I might be preaching to the converted.Nevertheless, it is our hope that you, as a community of UK business leaders based in Asia, could also serve as evangelists who carry our message to a wider audience in the UK and Europe.I wish you all much success in your ventures.Thank you.