SPEECH BY MR S ISWARAN, MINISTER FOR TRADE AND INDUSTRY (INDUSTRY) AT THE 4th CANADA-ASEAN BUSINESS COUNCIL (CABC) BUSINESS FORUM OPENING BANQUET ON WEDNESDAY 21 MARCH 2018, 7.00PM AT THE SHANGRI-LA HOTEL SINGAPORE
Mr Wayne Farmer, President, Canada-ASEAN Business Council,
Mr Jean Charest, Partner, McCarthy Tétrault,
Excellencies, Ambassadors, High Commissioners,
Ladies and gentlemen,
1. A very good evening to all of you. It is my pleasure to join you at the 4th Canada-ASEAN Business Council Business Forum today.
ASEAN continues to be an economic bright spot
2. Last year marked the 50th Anniversary of ASEAN’s formation. ASEAN has come a long way since its founding in 1967. With its young population, growing middle class, and increasing urbanisation, the ASEAN region is an increasingly important market in the global economy, and one of the important engines of growth in Asia.
3. The economic data is testament to ASEAN’s rapid growth. In the span of 50 years, ASEAN’s GDP grew from US$23 billion in 1967 to US$2.55 trillion in 2016, doubling its share of global GDP from about 3.3% to 6.2%. ASEAN’s GDP per capita also rose over the same period from US$122 to US$4,021. Today, ASEAN is the 6th largest economy in the world, with a collective market of more than 600 million consumers.
4. That is the past, and I would offer to you the proposition that the future of ASEAN holds even greater promise. That is why this forum and Canada’s engagement in this region is essential. The region continues to develop rapidly, and the realisation of the ASEAN Economic Community (AEC) in 2015 has created a more seamless business operating environment by reducing trade barriers and improving market access. ASEAN member states are presently working with six of our dialogue partners, Australia, China, Japan, South Korea, India, and New Zealand, to further deepen our regional economic integration, through the architecture of the Regional Comprehensive Economic Partnership (RCEP). A more economically-integrated region will bring greater opportunities for the businesses and people of ASEAN, through the continued reduction of barriers and preferential market access. Indeed, it is expected that by 2030, if ASEAN maintains this pace of growth, it will become the fourth largest single market, after the EU, US, and China.
Deeper economic linkages between ASEAN and Canada will be mutually-beneficial
5. Canada’s ties with ASEAN are longstanding. Last year, we celebrated 40 years of ASEAN-Canada dialogue relations. Our trade and investment links have continued to grow, especially in recent years. ASEAN is Canada’s 6th largest trading partner, with two-way trade in goods amounting to US$16.5 billion (CAD$21.6 billion) in 2016. FDI flows from Canada to ASEAN totalled over US$6.5 billion (CAD$8.5 billion), and the stock of FDI from ASEAN to Canada exceeded US$760 million (CAD$1 billion) in 2016.
6. There is potential to facilitate greater economic cooperation and business flows. ASEAN and Canada, we believe, must continue to deepen ties and enhance our linkages. This August, we look forward to completing the Joint Feasibility Study for a potential ASEAN-Canada Free Trade Agreement. This would be an important step in guiding the Exploratory Discussions for a potential ASEAN-Canada FTA.
7. We also hope to build on the success of the inaugural ASEAN-Canada Trade Policy Dialogue held in July 2017, where ASEAN benefitted from Canada sharing its expertise and experiences in Small- and Medium- Sized Enterprises (SMEs) development. The next run of the Dialogue will be held later this year, and we look forward to fruitful discussions.
Economic Deliverables during Singapore’s 2018 ASEAN Chairmanship
8. Beyond these initiatives, there are new avenues to further ASEAN-Canada economic ties. Singapore’s ASEAN Chairmanship comes at an important juncture, where there is a confluence of shifts in the global economy, technological adjustments, and new market opportunities that are being unlocked. We hope to tap on these opportunities which are associated with global megatrends – such as the digital economy – to help businesses, especially SMEs, expand their economic space and develop new markets and connections. We are aiming for a set of tangible deliverables that will promote innovation, build digital connectivity and facilitate e-Commerce flows. Let me highlight two examples to illustrate our focus:
9. First, Singapore is working with the ASEAN Member States to pursue an Agreement on e-Commerce, which aims to advance trade rules in e-Commerce, lower businesses’ operating barriers to entry, and build up greater digital connectivity for the growth of the digital economy. This is a relatively new area of focus for ASEAN, and there is interest amongst our ASEAN Member States to develop their e-commerce capabilities to tap on emerging opportunities presented by the digital economy. In particular, this is motivated by the recognition that the digital economy, in an unprecedented way, allows the smallest enterprise to access opportunities in the furthest markets with relative ease.
10. Secondly, we are developing an ASEAN Digital Integration Framework that will help to monitor the progress of ASEAN’s digital integration efforts. This Framework will allow us to better scrutinise and evaluate our digital ecosystem, to identify areas for improvement. One example would be electronic payment systems. To ensure safe and secure payment systems in the region, ASEAN is developing a workplan to foster interoperability between electronic payment networks and services by adopting international standards.
11. As digital technologies grow in their importance to international trade and investment, and enable relatively easy access even to distant markets, we believe it is an opportune time for Canadian businesses to benefit from the opportunities in this part of the world.
Singapore is a natural partner for Canadian companies and people to access the opportunities here, and in our neighbouring markets
12. Singapore is a natural partner for Canadian businesses and people in this regard. Our position and experience in the region, coupled with good governance, strong adherence to the rule of law, and transparent regulations, make Singapore a trusted and valuable partner to Canada.
13. The over 600 Canadian companies in Singapore have already recognised this value proposition, with many establishing their regional headquarters here. One example is Bombardier. The Aircraft Service Centre at Seletar Aerospace Park, which was established in 2014, is Bombardier’s first company-owned and operated service centre in the Asia-Pacific. It has the capabilities to support the entire range of Bombardier’s business jets, and to provide technical troubleshooting and on-site support services for regional customers.
14. Singaporean and Canadian researchers have also worked well together on R&D projects. In 2015, researchers from Canada’s Hydro-Quebec and our Agency for Science, Technology and Research’s (A*STAR’s) Institute of Bioengineering and Nanotechnology (IBN) announced a technological breakthrough which could more than double the energy capacity of rechargeable lithium-ion batteries as compared to conventional phosphate-based cathodes. We are optimistic that there will be many more opportunities for such collaboration, as Canada and Singapore prioritise technology and innovation as drivers for future economic growth.
15. More broadly, Singapore and Canada are like-minded partners with growing bilateral economic links. For example, the investment flow from Canada has been on an upward trend with FDI into Singapore totalling US$9.23 billion (S$12.14 billion), a 13.2% increase from the US$7.99 billion (S$10.5 billion) in 2015.
16. More recently, the signing on 8 March 2018 of the Comprehensive and Progressive Trans-Pacific Partnership, also known as the CPTPP Agreement, marked an important milestone in the Canada-Singapore relationship, and anchors Canada’s economic engagement in the Asia-Pacific. This agreement is of both substantive and symbolic value, especially in the context of today’s global economic climate. In contrast to anti-globalisation sentiments and protectionist rhetoric, the CPTPP is testament to our collective belief in the importance of economic openness and trade liberalisation. It is also a tangible demonstration of our two countries’ commitment (as well as that of the other CPTPP members) to uphold the global trade order.
17. We see significant opportunities and we think there is much potential in the collaboration between Canada and ASEAN, and between Canada and Singapore. As we continue to chart the next chapter of the ASEAN story, we look forward to deepening ASEAN-Canada relations so that our businesses and people can partner and mutually benefit from the growing opportunities in the region. Singapore remains a valuable and trusted partner for Canadian businesses in this endeavour. We welcome Canadian businesses to take advantage of our role as a gateway to the region to connect with the rest of ASEAN.
18. Once again, I would like to express my appreciation to Canada-ASEAN Business Council for hosting the Business Forum in Singapore and for inviting me today. I wish everyone a pleasant and productive evening.
19. Thank you.