SPEECH BY MR TEO SER LUCK, MINISTER OF STATE FOR TRADE AND INDUSTRY, AT THE SMCCI MALAY/MUSLIM BUSINESS CONFERENCE 2013 ON TUESDAY, 7 MAY 2013, 9.30 A.M. AT RESORTS WORLD CONVENTION CENTRE, SENTOSA
Good Morning.
Speech
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07 MAY 2013
Mr Teo Ser Luck at the SMCCI Malay Muslim Business Conference 2013
Mr Teo Ser Luck at the SMCCI Malay Muslim Business Conference 2013
Mr Abdul Rohim Sarip, President, SMCCI
Distinguished Guests,
Ladies and Gentlemen,
1. It gives me great pleasure to attend this Malay/Muslim Business Conference organised by the Singapore Malay Chamber of Commerce and Industry (SMCCI).
Capturing overseas growth opportunities
2. This year, our economic growth is projected to be between 1 – 3%. Economic conditions remain challenging due to a combination of our domestic constraints as well as global economic uncertainties in the US and Europe. However, the good news is that there are still growth opportunities within ASEAN. With initiatives like ASEAN 2015 which aims to transform Southeast Asia into a unified and competitive market, intra-Asian trade is projected to grow at 8% annually, thus presenting a substantive market for SMEs.
3. Take the example of Indonesia. Indonesia’s economic performance has been on an uptrend path, posting consistently positive growth. According to the IE Insights Report in November last year, for the past five years since 2007, Indonesia has posted GDP growth rates of above 6%, except for 2009, when it grew at 4.5%. A report by McKinsey Global Institute in September 2012 highlighted that Indonesia could surpass Germany and the UK by 2030 to become the seventh largest economy in the world.
4. Malaysia is another potential market for Singapore companies due to close proximity, socio cultural similarity and a relatively large market size with a population of 29 million. Its economy remains resilient, propelled by projects under the Economic Transformation and Government Transformation plans to achieve High Income Nation Status by 2020. New initiatives such as human capital development and liberalisation of service sectors will open up opportunities for Singapore companies, especially in the education and healthcare sectors.
5. Many businesses have recognised the potential and embarked on the internationalisation journey to enter new markets. Findings from DP Information Group’s SME Development Survey in 2012 showed that the number of SMEs that have reported overseas revenue increased from 10% to 54%. Similarly, Malay and Muslim businesses should build up resources and capabilities for effective overseas market expansion.
6. According to a survey done by Malay Chambers in 2007, more than 70% of Malay and Muslim businesses in Singapore serve the local market and they are mainly in the retail and services sector. Competition is intense in these sectors as our domestic market is limited. In the longer run, our SMEs need to make a leap beyond Singapore, especially into Asia, to capture these overseas growth opportunities. SMCCI plays a pivotal role to help these businesses to strengthen capabilities, match-make to relevant business partners and provide platforms for sharing and networking with overseas businesses.
The Government’s Support for SMEs
7. The Government will also help SMEs that want to internationalise. To venture overseas, SMEs can tap on IE Singapore and its 38 offices for help. IE Singapore’s new Market Readiness Assistance (MRA) Grant also provides faster and easier market access for SMEs that are relatively young and inexperienced, and lack the resources for good market set-up and business leads. $18 million has been set aside to support 1,000 companies for the next three years, in areas such as market assessment, tax and legal advice, setting up overseas and business matching.
8. SMEs can also tap on the International Marketing Activities Programme (iMAP) and the Local Enterprise and Association Development (LEAD) programme to explore business opportunities through overseas missions organised by the Trade Associations and Chambers. Through iMAP, I note that SMCCI has brought more than 80 companies on business missions to Saudi Arabia, Indonesia, Malaysia and Brunei in 2011 and 2012.
9. SMCCI and six companies participated in the Food & Hospitality Oman Trade Expo in December last year, one of the largest exhibitions in Oman for the food and hospitality sector which showcased kitchen and catering equipment, food packaging products, and food processing technologies. I was told that these six companies established 140 business contacts and managed to secure sales of close to a million dollars.
10. An SME that has benefitted from the Capability Development Grant is E&P Training Centre, an enrichment centre that offers learning solutions in mathematics, mental arithmetic and total brain development. The company is the first children enrichment centre globally to attain the ISO certification in 1995 and to be recognised by the International Abacus Association. To improve delivery of the enrichment programmes, the company used the grant to develop a learning management system and a web-based platform to deliver its content via games and online assessments. By innovating its delivery approach, the company expects to double its enrolment numbers in the next five years and expand its global reach to three new regional markets through subscription fees and licensing of its system to public and international schools.
Seeking Help from SME Centres
11. It is important that TACs take the lead on the SME Centres because they play a very critical role in engaging our local business community. Moving forward, the Government will give more autonomy to the TACs so that they are able to make decisions on the spot and also on approval for applications of grants and schemes. We hope that the TACs will also take the lead in considering expanding its outreach beyond the shores of Singapore, maybe explore the possibility of SME Satellite Centres overseas, like in the ASEAN market.
12. I understand that the SME Centre@SMCCI regularly organises seminars to help Malay/Muslim businesses upgrade their capabilities and access new markets overseas. For example, SME Centre@SMCCI started the quarterly ‘Smart SME Seminar Series’ to help Malay/Muslim businesses transform their businesses through experience sharing and handholding. I would like to take this opportunity to encourage more Malay and Muslim businesses to approach the business advisors at the SME Centre.
Conclusion
13. Today’s event shows the continuous effort of SMCCI to provide a platform for local SMEs to increase their business networks and be assisted to penetrate global markets amidst the increasingly competitive and evolving economy. I am hopeful that the networking and discussions that will take place later will be fruitful sessions. I wish you a pleasant day ahead. Thank you.