Speech by Mr S Iswaran, Minister, Prime Minister's Office and Second Minister for Home Affairs and Trade & Industry at the 5th Anniversary Celebration of the International Trading Institute (ITI) on Monday, 1 April 2013, 10.20AM, Singapore Management University
Distinguished Guests,
Ladies and Gentlemen,
Good morning. I am pleased to join you this morning to celebrate the fifth anniversary of the International Trading Institute (ITI).
The Important Role of Human Capital
We live in an era of unprecedented competition for talent. What defines the success of a company is not just what it does but also in the way it is able to recognise, attract, develop and retain its talent. This is a key differentiating factor that determines the success of many corporations across diverse sectors, particularly so when you look at domains that are knowledge and content intensive. One example that we see and cited time and again is in the Silicon Valley, where there is a constant quest for knowledge and talent.
Across different domains, we have also seen candidates becoming more discerning in terms of whom they choose to work for and why they do so. According to a Forbes1 report, the companies that appear at the top of the “best companies to work for” list are those who have proven themselves to be progressive and active in the way they invest in their people.
That is a conviction that Singapore holds deeply, that is, to invest in our people, nurture and enable them to realise their full potential and in doing so, strengthen our competitive edge for our economy and companies. That, ultimately, is our goal of our economic policy – creating good jobs and quality growth, which is supported by our education policy which endows our young Singaporeans with the capabilities to pursue these opportunities. So we have invested heavily in education to drive life-long learning and talent development. Institutes of higher learning, such as SMU, are the Government’s crucial partners in this regard – especially when we need to develop talent in specialised areas of expertise, such as trading.
Talent drives the expansion of the trading sector
Trade is the lifeblood of Singapore. In Singapore, we exist because we are useful to the world, such as our excellent connectivity, and it is something that we seek out in different ways. Fundamentally, we want to be an open economy and we seek to be active players in the global and regional platforms in order to promote free trade architecture. For example, we are active in WTO. We are also active in regional initiatives, whether it is in the context of ASEAN or Asia-Pacific. We are also key mobilisers of new ideas in this space. One example is the Trans-Pacific Partnership which started off as an initiative involving only four countries and is now seeing interest from more countries.
Intra-regional trade in the Asia-Pacific has also grown significantly. The Asia-Pacific currently accounts for close to one fifth of global output.2 We are seeing more multinational corporations such as Trafigura and Vitol expanding in this region. At the same time, Asian companies such as Olam and Wilmar are fast becoming significant global players.
Our trade infrastructure has developed in tandem to support the needs of the trading companies based here. There are now more banks in Singapore that offer commodity trade financing – an esoteric financing product that only specialised banks used to offer in the past. Take DBS for example. Last year, it has increased its commodity financing book to $25 billion.3 In the area of risk management solutions, SGX now offers commodity derivative contracts tailored to Asian trade flows, such as those in rubber, iron ore and coal.
Building up expertise in the trading sector
For Singapore to stay competitive and be able to seize growth opportunities in the region, we are quite clear that it is not just about investments but also about talent development. It is therefore critical that our trading firms here have a ready pool of talent – both global and local – that they can tap and who have highly specialised skill sets to ensure the vibrancy of our trading sector. Today, employment in this sector has reached about 12,000 people, of which 60 per cent are Singaporeans. We can do more to grow this pool.
In this regard, the Government is committed to continue with our efforts to nurture a pipeline of home-grown talent for the trading sector. And institutes like the ITI will also play a significant role in this endeavour. Since its establishment in 2007, the ITI has been a key platform for us to expand our local undergraduate and graduate talent pool for the trading community. To date, we have close to 200 local graduates from the ITI joining the trading and related sectors. One of ITI’s recent graduates, Geraldine Cheang, is a case in point. In July last year, Geraldine joined Trafigura under its graduate program. In her current and first rotation at Trafigura’s Singapore Trade Finance desk, she not only gets to handle the crude and bitumen books but also gains experience in communicating directly with trading partners and banks to ensure that trades are carried out smoothly. Another example is Leon Ng, one of ITI’s alumnus from the class of 2007 who will share in greater detail about his experience at the panel session later. When Leon first started, he was working as an Operations Executive, assisting traders in their work. After five years in the industry, Leon is now a trader in his own right, where he manages the trading of phosphates and compounds for the Asia-Pacific region at Koch Fertilizer, a global trading company based in Singapore. I am pleased that graduates like Geraldine and Leon have moved on from where they started off to taking up greater responsibilities because of their outstanding performances.
Apart from grooming those who are keen to enter the trading sector, the ITI has also introduced an Advanced Certificate in Trading for SMU’s graduate students in March this year. Through this eight-day course, SMU MBA students will be equipped with the foundational knowledge for easy transition into the trading sector. Classroom sessions are taught by the SMU faculty and industry veterans. Students have the opportunity to go on site visits to palm oil plantations, processing plants and terminals to acquire a deeper understanding of the commodity traded. At the end of the course, students will also get to interact with key industry leaders through dialogue sessions. I am pleased to learn that the pioneer batch of 21 students will be completing their course this month.
ITI will continue to groom more talent by doubling its number of graduates to about 100 per year, by 2015. In fact, the Institute has started exploring partnerships with other universities such as the Singapore University of Technology and Design (SUTD). I understand that ITI will be signing an MOU with SUTD later for their collaboration on the Trading Associate Programme, which will commence next year. With this Programme, SUTD undergraduates will be trained in skill sets that give them a competitive edge for jobs within the trading value chain and related sectors.
Conclusion
Trading is a sector that has great potential not just from an economic point of view but also a sector that is able to create good jobs for young Singaporeans. The vitality of our economy will continue to rest on the growth of such sectors. For the trading sector, the Government has made a concerted effort together with education players and the industry to identify and nurture high potential talent. We will continue to do so.
To the 44 students who will be graduating from ITI this year with a specialisation in international trading, I wish you the very best and you will have a great future ahead of you, given the opportunities we see in this sector. To those who have graduated and are now part of the trading community, I urge you to make your mark and also come back and share so that you can impart your knowledge and experiences. To our industry partners, I want to thank you for your collaboration with the Government and I look forward to more of such collaborations to entrench Singapore’s position as a global trading hub.
Thank you.
1 Forbes, 2012, “The Best Companies to Work for in 2013”, by Jacquelyn Smith
2 BBC News, 2012, “Viewpoint: Is the Asian Growth Story Faltering?” by Chief Economist East Asia and Pacific, World Bank
3 The Business Times, 2012, “DBS well placed to meet Asia’s demand for financing”, by Siow Li Sen