SPEECH BY MR S ISWARAN, MINISTER FOR TRADE AND INDUSTRY (INDUSTRY), AT THE 2017 MTI ECONOMIC DIALOGUE ON 28 AUGUST 2017, 6.10PM, MULTIPURPOSE HALL, INNOVIS BUILDING, FUSIONOPOLIS 2
Professor Euston Quah, Head of Department of Economics, NTU;
Faculty and Students;
Ladies and Gentlemen;
Introduction
1. I am pleased to join you this evening at the 9th MTI Economic Dialogue. This is a valuable annual forum where we discuss current economic issues with students, and recognise those who have excelled in their research and studies.
2. Let me start by congratulating this year’s thesis prize winners – Toh Shang Wei, Gideon Wong, and Ralph Yip from NTU, Sripriya Srivatsa from SMU, and Tay Geng Zhi from NUS.
3. I would also like to congratulate the economics book prize winners – Toh Zheng Yong from NTU, Timothy Ang from SMU, and Jocelyn Tan from NUS.
4. This evening, we are also presenting the Economist Service Scholarships to two students, Ngoh Jia Hui and Lim Rei Hrn. They have demonstrated aptitude for the field and a keen interest to serve in the public service. Congratulations to all of you.
5. Today, I would like to touch on some trends which are changing industries, enterprises and jobs, but also creating new opportunities and pathways for us to make a difference in the world.
Trends affecting the Singapore Economy
6. First, the trends. New technologies are fundamentally changing business models. Amazon’s newly launched 2-hour delivery service is making online shopping even more convenient and disrupting traditional retail businesses. Grab, Uber, DiDi Chuxing, and Go-Jek are doing the same in the taxi business, and bicycle-sharing services like oBike are re-defining last mile connectivity in transport, even as they pose new challenges. Businesses must be nimble and adapt quickly to such changes, or risk becoming obsolete.
7. These innovations affect all industries, and are occurring across the world. Indeed, some of the biggest changes are in developing countries. China is no longer just a low-cost manufacturing hub, having moved up the value chain and competing with developed countries. Shenzhen, is now considered the world’s capital of hardware innovation, producing 70% of the world’s drones. China is also making significant investments in research and development, and acquiring capabilities in other high-tech industries like semiconductors.
8. The rise of China and the rest of Asia, especially India and Southeast Asia, is also a historic opportunity. Asia is one of the fastest growing regions in the world, projected to grow at 6.4% this year, compared to 2% in advanced economies. To put this into perspective, a 6.4% growth rate implies a doubling of GDP every 11 years. More importantly, it will lift hundreds of millions of people out of poverty and raise their living standards. Singapore can make a meaningful contribution to this Asian economic renaissance, and also benefit from it.
9. Technology and innovation are creating new possibilities. FinTech companies in Singapore are tapping on block chain technology to make financial transactions cheaper and more secure. Block chain can significantly enhance global trade through improvements in logistics and trade financing. Some of the potential applications also lie within the public sector. Ngee Ann Polytechnic, for example, is piloting the use of block chain to securely issue and verify academic certificates.
10. Artificial intelligence (AI) is another exciting area. Saleswhale, a local startup, launched an AI assistant last year which automates the process of reviving old sales leads. It can automatically conduct an email conversation with potential customers, before routing selected customers to a human sales rep. By automating this repetitive process, Saleswhale has lessened the need for junior sales staff, a group plagued by high turnover, probably due to the mundane nature of the work. Dr Lim Kuo-Yi is Managing Partner of Monk’s Hill Ventures, which led Saleswhale’s recent seed capital round. He will be joining the panel later, where we can discuss some of these exciting technologies and the possibilities they open up for the way we live, work and play.
11. Some of these new opportunities lie at the confluence of new technologies and the developments in Asian economies. While e-commerce disrupts the retail sector, digital technologies also allow us to access overseas markets more easily. For instance, India has introduced its biometric Aadhar identity system. Today, almost a billion Indians have been assigned a unique 12-digit number, verified through the scan of a thumb or an eye.
12. Combined with India’s high mobile penetration rate, this has opened up new opportunities which DBS has seized. Last year, DBS launched India’s first mobile-only bank, relying on the Aadhar identity system to verify its records and systems. This is not only good for business, but also serves a valuable social purpose by providing financial services to India’s large previously-unbanked population. Doing away with a physical set up and using AI in its services, DBS only requires a fifth of the resources of a traditional bank, reducing costs and allowing many more Indians to access banking services. Since its launch last year, almost a million Indians have signed up for DBS’ digital bank.
13. You may also be familiar with Garena, a local company and the owner of a digital entertainment platform with games like League of Legends and FIFA Online. Garena is Southeast Asia’s largest unicorn, and recently rebranded itself as Sea Ltd, which stands for Southeast Asia reflecting its regional focus. It has also expanded into e-commerce and online payments, and aims to give consumers and small businesses in the region access to the Southeast Asian and global markets. Many other businesses are making headway in this space. Later, we will be joined on the panel by Ms Audrey Kuah, Managing Director of Dentsu Aegis Network’s Global Data Innovation Centre in Singapore. She will be able to share insights on how this global media group and its innovation centre in Singapore is developing data-driven marketing techniques for use in the region and beyond.
14. Ultimately, the change is ubiquitous – it is happening everywhere and on an unprecedented scale. Whether you are a startup like Saleswhale, a multinational company like DBS, or the Government; whether you in emerging economies like Garena or more developed cities like Amazon; whether it is high tech manufacturing or healthcare, education and other services; whether you are prepared or not, the change is already here and gathering momentum.
Call to Action
15. Rather than seek to resist these changes, the smart response is to embrace them and turn them into opportunities. In particular, what does this mean for students like you who have a strong educational foundation and will soon enter the workforce? How can you make a difference in your chosen field by harnessing these trends to grow your pool of knowledge and experience, to make a difference in you chosen field? The key is to be willing to venture beyond your comfort zones, learn continuously, take some risks and learn from failures, and build deep skills and capabilities. Here are a few thoughts and suggestions.
16. First, be proactive in seeking out opportunities to gain regional exposure, whether through overseas internships, semesters abroad, or regional work assignments. Business chiefs will tell you that regional experience is a pre-requisite for any young person eyeing leadership positions. It is also an opportunity to make an impact in one of the most dynamic regions of the world.
17. Take advantage of International Enterprise (IE) Singapore’s recently announced the Go Southeast Asia (SEA) Award, which matches final-year undergrads with Singapore companies for internships in their Southeast Asian offices. This year, IE Singapore will offer 30 awards, which cover living and travel expenses, as well as a company stipend. Another programme that can be of benefit later in your career, is the SkillsFuture Leadership Development Initiative (LDI). It supports companies to groom Singaporean leaders through training programmes, including exposure to key regional or global markets.
18. Second, embrace lifelong learning to understand emerging technologies, acquire new skills and stay relevant to industry. Today, this is even easier because access to education is no longer confined to conventional channels and institutions. Other than massive open online courses (MOOC) on platforms like EdX, Coursera, and Udacity, Singapore’s institutes of higher learning (IHLs) are also offering more skills-based, technology-enabled, modular courses, which are subsidised and allow you to acquire the specific skills that you need at any point in time.
19. Finally, if you have an entrepreneurial spark, follow it. It is quite apt that this year’s dialogue is being held in the vibrant One-North precinct which is teeming with research and start-up activity. Right across the street is JTC LaunchPad @ One-North, an ecosystem of more than 800 startups and about 50 venture capital firms, incubators, and accelerators. I believe some of you had the opportunity to tour the area earlier. The entrepreneurs at LaunchPad epitomise this spirit of adventure, willing to step outside their comfort zones, take risks and continuously improve.
20. Take Derek Tan and Ho Jia Jian, for instance. Both are passionate about films, and collaborated to produce a film called “CASHLESS”, which was picked up by a few festivals but struggled to gain a wider audience outside. In 2013, both of them took a leap of faith, left their stable careers, and decided to start an online platform for Asian films. They understood the shift towards online media consumption and recognised the opportunity to help independent filmmakers reach a wider, global audience. Despite not having any formal education in digital media distribution or prior business experience in emerging Asian economies, they were willing to learn, ready to engage regional markets, and fuelled by a deep passion. Today, Viddsee has garnered more than 500 million users globally, and has become a leading platform for Asian films and stories.
21. You don’t need to do it alone as there is significant support in Singapore for such entrepreneurial ventures. For example, under Startup SG Founder, first-time entrepreneurs are offered up to $30,000 in Government funding by matching $3 to every $1 raised privately. You can also gain access to angel investors and mentors through various networks. Through the Startup SG Equity scheme, SPRING can co-invest with other investors up to $2 million for general tech startups and $4 million for deep tech startups.
22. We have also been expanding the space available for startups. In March this year, we opened the second phase of LaunchPad here at one-north. In June, the second LaunchPad was completed at the Jurong Innovation District. BLOCK71, one of the iconic brand names in LaunchPad, has also been expanding overseas. Last month, it expanded into Jakarta, serving as a launchpad for Singaporean startups into the Indonesian market, with Viddsee being one of the companies located there. BLOCK71 now has locations in Singapore, San Francisco, and Jakarta, with the next slated to be at Suzhou Industrial Park in China. This innovation network will grow further through the formation of a Global Innovation Alliance to connect our students, entrepreneurs and companies with major innovation hubs and key demand markets. These are certainly exciting times.
Conclusion
23. Let me conclude by noting that while the Government and other institutions can provide a plethora of support, ultimately the onus is on each and every one of us to take the initiative to map out our personal journeys and tap on these opportunities. So, I hope that you will seize the moment – venture abroad, gain new experiences and learn new skills, and boldly innovate. Thank you.