​KEYNOTE SPEECH BY MINISTER FOR TRADE AND INDUSTRY CHAN CHUN SING AT THE EUROCHAM EUROPE DAY LUNCHEON, JOHN JACOB BALLROOM, THE ST. REGIS, SINGAPORE, 4 MAY 2018, 1.20 PM​

Your Excellency Ms Barbara Plinkert, EU Ambassador to Singapore,

Mr Stefano Poli, President of EuroCham

Excellencies,

Distinguished Guests,

Ladies and Gentlemen,

1.              Good afternoon. Thank you for inviting me to speak at this Europe Day Luncheon.

Amidst a challenging global environment for trade, the EU is an important flag-bearer for free trade.

2.              68 years ago, with the Schuman Declaration and the creation of the European Coal and Steel Community (ECSC), Europe took its first steps towards economic integration and interdependence. The ECSC laid the foundation for what we now know as the European Union (EU) – a region of peace and stability; a prosperous single market; the world’s second-largest economy; and the world’s largest trading bloc. 

3.              It is timely that we are gathered here today to commemorate the Schuman Declaration. Protectionist sentiments are taking root in some parts of the world. Anti-globalisation sentiments continue to dominate political discourse. Against this backdrop, we are seeing escalating trade tensions - notably between China and the US, which if unchecked, could undermine the global trading system.

4.              Yet amidst this challenging environment for global trade, we are pleased to note that the EU remains a staunch proponent for free trade. Despite pressures to look inward, the EU has continued to push forward many free trade agreements (FTAs) with key partners. In December 2017, the EU concluded an economic partnership with Japan that would create the world’s largest economic area covering 30 per cent of global GDP. In April this year, the EU upgraded its free trade agreement with Mexico. I understand that the EU is also actively pursuing the EU-Mercosur FTA.

5.              As a G3 economy, the EU’s leadership sends an important signal to the world that free and open trade remains the path forward. Free and open trade has lifted millions out of poverty and continues to be the basis for our prosperity.

 

As a strong proponent of free and open trade, Singapore has pursued connectivity to the world as our competitive edge to transcend our constraints.

6.              For a small and open economy like Singapore, trade has always been our lifeblood. Our trade volume is three and a half times our GDP. This means that we are heavily dependent on the free flow of goods, services, and investments. Thus, like the EU, we are firm believers in a rules-based multilateral trading system. Indeed, the multilateral trading system has allowed economies around the world, big or small, to trade and grow together based on agreed rules, norms, and on an equal basis.

7.              To ensure the resilience of our economy, Singapore has actively pursued greater connectivity to regional and global economies. We see the world as our hinterland, and doing so has allowed us to transcend our physical constraints and avoid being circumscribed by geography.

8.              To this end, we have an extensive network of 22 implemented FTAs with 33 trading partners. In March this year, we signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) which comprises Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The CPTPP is a concrete demonstration of the partner countries’ commitment to the collective goals of greater trade liberalisation and regional economic integration. It is our hope that the ratification of the CPTPP can be completed before the end of the year. In the meantime, Singapore is actively pursuing other FTAs with economic blocs like the Eurasian Economic Union and the Pacific Alliance. These agreements enhance our connectivity to the world and create more opportunities for Singapore businesses and our partnering countries.

9.              But this is just one aspect of connectivity. For partners who are familiar with us, they would know that we also have excellent connectivity as an air and sea hub for both passengers and goods. To continue remaining relevant and competitive in an increasingly connected world, we will have to work on new dimensions of connectivity, and these include data; finance; talent; and technology.

Domestically, Singapore is ensuring that we remain competitive by providing a conducive and pro-business environment.

10.           And while we continue to strengthen these external linkages, domestically, we are also ensuring that Singapore remains a conducive place for doing business. Our pro-business policies, sound legal and regulatory system, and robust intellectual property protections provide certainty to businesses and fosters innovation. These are important attributes of our competitiveness which we take very seriously.

11.           Singapore has long been recognised as one of the best cities for doing business. For example, we are ranked 2nd in the world for ease of doing business under the World Bank’s Doing Business Survey; we are the 3rd most competitive economy in the world according to IMD’s World Competitiveness Rankings; and we are ranked 1st (in Asia) and 4th (globally) for the institutional protection of intellectual property based on the World Economic Forum’s Global Competitiveness Report.

12.           For these reasons, there are more than 10,000 EU companies in Singapore, many of whom use Singapore as a base to enter regional markets. Thanks to the many European businesses present today, Singapore is the number one location for European investments in Asia, thus making the EU Singapore’s largest investor.

13.           I am also pleased to note that we have many examples of successful partnerships between Singapore and EU businesses, tapping on each other’s complementary strengths. For example, Shell’s (Netherlands) partnership with the Sunseap Group, which is Singapore’s leading integrated clean energy solutions provider. Both parties have come together to collaborate on solar projects in the Asia Pacific region. German company “SICK”[1] is also working with SATS on sensors for lift trucks at Changi Airport that would enable the lifting of cargo and supplies to be automated and less labour intensive. These are just two out of many examples that demonstrate the compatibility of our companies and the ease with which they are working with one another. We hope to see more of these in the future.

Being open to talent remains key to our continued success

14.           Beyond connectivity and a pro-business environment, another key criterion for our continued success is being open to talent. This is our reality as a small country with no natural resources and a maturing workforce. We have always invested significantly in our people to ensure that our workforce is competitive and right-skilled. Doing so has allowed us to benefit from bringing in higher value-added activities and creating job opportunities. Moving forward, talent will be an increasingly important part of the economic equation, as Singapore embarks on our next phase of growth through the Industry Transformation Maps and transitions into an innovation-driven economy.

15.           Indeed, the quality of our workforce will be more important than ever in the future economy. This is why we have introduced programmes like SkillsFuture to help Singaporeans prepare themselves for the future and to reach their fullest potential. And while we are building a strong Singaporean core, we must continue to remain open to talent and attract the best people to come and take part in the Singapore growth story. Foreign labour complements Singaporean workers and brings along relevant skills to create new industries and job opportunities. This is crucial to our longer term competitiveness, and ensures that we stay relevant to a dynamic region that is fast evolving.

16.           We must also put in place plans, systems and mechanisms to help Singaporeans go overseas and explore opportunities, network with the region, and build up cross-cultural, international competencies. It is about growing the local talent pool and networking them with the external talent pool for us to have what we call a Singapore global talent network.

A growing Asia presents significant economic opportunities.

17.           The global economic centre of gravity is shifting eastwards. ASEAN alone is projected to have a US$3 trillion economy by 2020, and is expected to become the fourth-largest economy by 2030. In ASEAN we have a large market of over 600 million people; a young and dynamic population; rising middle class; and rapid urbanisation. These conditions make the ASEAN region an increasingly important market in the global economy. And with the ASEAN Economic Community (AEC), ASEAN has been transformed into a competitive single market and production base. This would facilitate trade and investment across the region.

18.           As ASEAN Chair this year, Singapore’s overall economic objective is to deepen regional connectivity in order to position the region for increasingly seamless economic activity and opportunities. Today, ASEAN has FTAs with key partners in the region, namely Australia, China, India, Japan, Republic of Korea, and New Zealand. ASEAN and our FTA partners are pursuing the Regional Comprehensive Economic Partnership (RCEP). When concluded, RCEP will boost economic growth and strengthen regional supply chains.

19.           It is our hope that ASEAN can build new linkages to strengthen our connectivity to a like-minded partner such as the EU. As a single economy, ASEAN is already the EU’s third-largest trading partner outside Europe (after the US and China). Singapore accounts for about one-third of the EU’s total trade with ASEAN.  As the region continues to grow, we believe that there is great potential to promote trade and investment between our regions.

As a pathfinder agreement for the EU-ASEAN FTA, the EU-Singapore Free Trade Agreement (EUSFTA) is a strategic agreement that will catalyse greater region-to-region connectivity and help European businesses tap on regional activities through Singapore.

20.           This leads me to a very important endeavour between Singapore and the EU. I believe all present are eagerly waiting for the entry into force of the EU-Singapore Free Trade Agreement (EUSFTA). The EUSFTA will lower tariff and non-tariff barriers to trade, improve market access for trade in services, and open up more government procurement opportunities for businesses. It will further enhance protection of intellectual property rights, including the protection of goods bearing Geographical Indications (GIs). Businesses are rightfully excited about the benefits and opportunities the agreement will bring.

21.           But beyond economic imperatives, the agreement also has significant strategic importance. It was not by chance that Singapore was the first ASEAN Member State with whom the EU chose to pursue a bilateral FTA with in 2009. The EUSFTA is a pathfinder towards an eventual EU-ASEAN FTA and anchors the EU’s engagement in the region.

22.           We welcome the recent news from the EU that the ratification of the EUSFTA is moving forward. The ratification of the EUSFTA will signal the EU’s resolve as a key proponent for free and open trade, and enhance the EU’s trade leadership in Asia. We look forward to your continued support for its expeditious ratification and hope for its early implementation.

23.           There is another added significance for us to quickly complete this ratification process against the global backdrop of protectionist measures. This will not just be a bilateral free trade agreement between the EU and Singapore. It will send an important and powerful signal to the entire global trading community of the EU and Singapore’s stand towards free trade agreements, economic integration and economic partnership.

 

Conclusion

24.           Let me conclude by expressing my appreciation to EuroCham and the EU Delegation in Singapore for your critical role in fostering closer relations between Singapore and the EU. Today, Singapore and the EU enjoy close political, business, and people-to-people ties in no small part due to your continued advocacy and active contributions.

25.           As like-minded partners, Singapore and the EU should continue to build on our close economic partnership. We look forward to even-stronger cooperation in the future. Thank you.

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