Distinguished guests,
Ladies and gentlemen,
1. Good morning. It is indeed my great pleasure to join you today at the opening of SEMICON Southeast Asia 2021.
2. For the past 28 years, SEMI and its Southeast Asia chapter has served as an excellent platform for industry players to explore new opportunities arising from the latest developments in technology.
3. The theme of this year’s conference, ‘Powering Innovation – 5G and beyond’, is of significant interest to all of us. 5G technology holds great promise for the future. 5G networks will help us spur innovation, create exciting business and job opportunities, and position Singapore as a leading digital economy. That is why we have been one of the first movers in the area, and began the rollout of our 5G infrastructure last year. We are on track to meet our target of deploying 5G standalone outdoor coverage across half of Singapore by end-2022, and nationwide by end of 2025. Trials on 5G applications are also underway, including at PSA Singapore to improve port operations, and at Razer and Singtel to deliver high-quality cloud gaming experiences to our consumers.
4. The semiconductor industry is both a major driver and beneficiary of the rollout of 5G. We have witnessed how global demand for semiconductor chips, found in everything from energy-saving electric cars to medical diagnostic equipment that enables the rapid detection of Covid-19, has surged in the past year. As we digitalise more, the growth of the industry will also continue to intensify. The value of the global semiconductor industry was estimated at around US$440 billion last year and is expected to grow to half a trillion dollars this year[1]. While it took the industry about half a century to reach this milestone, it is likely that it will only take another decade to double its current size.
5. Singapore stands ready to work with the semiconductor industry to make the most out of the exciting opportunities presented by this fast-growing sector. We are starting from a position of strength. Today, Singapore is home to the wafer fabrication facilities for 5 of the top 12 semiconductor companies globally; and 2 of the top 3 pure play foundries have fabs here in Singapore. Many of these companies also site critical R&D functions at their facilities here. For instance, Infineon’s Microcontroller units, which feature in 1 out of every 2 cars produced worldwide, are designed and tested here in Singapore. These capabilities extend beyond product R&D and into manufacturing R&D; with Singapore being home to STMicroelectronics’ first Silicon Carbide line outside of Europe.
Attracting and retaining Frontier Investments in Manufacturing
6. The Government will continue to build on this solid foundation to grow our semiconductor industry, as part of our wider goal of growing our manufacturing sector.
7. Manufacturing remains a critical pillar of Singapore’s economy, and today, Singapore has built a strong and diverse manufacturing base, with leadership positions in multiple industries such as electronics, aerospace, biomedical sciences, and chemicals. The sector remained resilient in 2020, growing by 7.3% last year despite the headwinds presented by the pandemic. It has continued to enjoy healthy growth this year with an 18% year-on-year growth in the second quarter, extending the 11% growth in the first quarter. These figures give us confidence that manufacturing remains a strong pillar of our economy, and an area that we should continue to build on.
8. Singapore will therefore continue to work hard to attract and retain frontier investments from best-in-class companies, and anchor their most advanced factories here. We have seen good momentum on this front:
· GlobalFoundries recently announced its plan to invest US$4 billion to expand its fab capacity in Singapore to support fast growing end-markets in automotive and 5G.
· Silitronic also announced that it would invest EUR 2 billion to build a new 12-inch wafer manufacturing plant in Singapore.
9. These investments are highly valuable not just because of their direct economic contribution and jobs created, but also because they contribute to the virtuous cycle of attracting more of such investments here. The suppliers, customers and partners of these investors would have yet another reason to choose Singapore for their investments too. Over time it will deepen the ecosystem even further, and make it more difficult for our competitors to replicate what we have here.
10. The Government does not take the trust that investors have in us for granted. For example, even at the height of the Covid-19 pandemic, we went out of our way to make sure that our semiconductor fabs could continue operations and their supply chains could remain intact. We kept our sea and air links open, facilitated trade of essential goods and services, and championed efforts internationally to allow goods to flow unimpeded across borders. We did this because we were cognisant of Singapore’s integral role in global semiconductor supply chains, and we knew that disrupting these supply chains could cause irreparable damage to investor confidence. The new investments we secured this year are therefore the dividends that we are reaping from our efforts last year to preserve the integrity of semiconductor operations and supply chains.
Galvanising the Ecosystem for Innovation
11. To strengthen Singapore’s position to capture new growth opportunities in the semiconductor industry, we will continue our strategy of steady and sustained R&D investments. We have announced that we would set aside S$25 billion under the Research, Innovation and Enterprise 2025 Plan over the next 5 years. This is a significant increase from the RIE2020 plan, and reflects our commitment to supporting companies in the development of new capabilities and technologies.
12. I am happy to note that the semiconductor industry shares this commitment to R&D as their competitive advantage. Indeed, your industry accounts for some 20% of total business expenditure on R&D (BERD), making it one of the largest contributors to Singapore’s private sector R&D expenditure. These investments have enabled the transformation of novel concepts into commercialisable technologies such as silicon photonics, which is the backbone technology of 5G communications, cloud computing and autonomous vehicles.
Conclusion
13. To conclude, exciting growth opportunities lie ahead for the semiconductor industry. Singapore stands ready to partner and support you in your next bound of growth.
14. I want to wish every one of you a fruitful conference ahead.
15. Thank you.