Mr. Simon Kuik, President of ASMI,
Ladies and gentlemen,
1. Good afternoon. Thank you, the Association of Singapore Marine Industries (ASMI), for inviting me to join you this afternoon at the launch of the Marine and Offshore Engineering (M&OE) Industry Digital Plan (IDP).
Singapore’s M&OE Sector – Our Source of Pride
2. Over the span of about 50 years, our M&OE sector has grown from its humble beginnings of just four domestic marine firms, to an ecosystem of more than 1,000 companies. This ecosystem includes many globally competitive small and medium enterprises (SMEs) as well as multinational corporations (MNCs).
3. The M&OE sector is a significant contributor to our economy. In 2019, it accounted for $11.5 billion in total output and employed more than 75,000 workers. The sector is also key in supporting Singapore’s maritime hub and international offshore energy activities.
4. The M&OE sector comprises large local enterprises (LLEs) as well as SMEs which have world-leading products and engineering capabilities. For example, Keppel Offshore & Marine (KOM) and Sembcorp Marine are renowned internationally for constructing offshore infrastructure such as oil rigs, floating Liquefied Natural Gas (LNG) assets and floating production storage and offloading (FPSO) systems. In addition, several of our SMEs are global leaders in various sub-fields, such as crew boat building, FPSO module fabrication, and oilfield equipment manufacturing.
Weather the COVID-19 Storm and Emerge Stronger
5. In recent years, the sector has been facing structural headwinds, in part due to declining oil prices and the global energy transition. Our enterprises adapted by pursuing new growth areas such as LNG and Offshore Wind. By doing so, they positioned themselves to capture longer-term opportunities. For instance, our Sembcorp Marine (SCM) is now recognised as one of the world leaders in LNG vessel repairs and upgrades. It clinched a world record of 55 LNG-related projects in 2019. Keppel Offshore & Marine (KOM) secured S$1.3 billion worth of offshore wind projects over the past two years, such as substations and wind turbine installation vessels. One of our SMEs, Mooreast Asia, has also gained traction in the Offshore Wind segment, having worked on six pilot offshore floating wind turbine projects in Japan and one in Europe.
6. The COVID-19 pandemic has brought further challenges to the sector. Many of our M&OE enterprises faced project delays and cancellations due to border restrictions and curbs on economic activities. They also had to make difficult but necessary worksite adjustments to protect our workers’ health and safety. With a fresh wave of new infections globally, it is a stark reminder that our fight against COVID-19 is far from over.
7. To help our M&OE enterprises weather the COVID-19 storm, we have put in place a series of immediate relief measures. Recently, we have increased the foreign worker levy (FWL) rebate for each worker from $90 per month to $250 per month for the Construction, Marine Shipyard and Process (CMP) sectors from May to December 2021. While the situation remains fluid, rest assured that we are constantly reviewing support measures to help enterprises.
8. I thank our business leaders and workers in the M&OE sector for their support and resilience in battling the pandemic. Let us maintain our vigilance and stand united in this fight. We understand that this is not an easy time for everyone. The Government, together with ASMI, will continue to support the sector to preserve core capabilities and build new ones to help the sector recover and seize new opportunities.
Digitalisation as One of the Capabilities to Capture Long-Term Growth
9. A key way to enhance resilience is through widespread digitalisation. The adoption of technology by the sector enhances the ability of companies to capture both existing and emerging opportunities globally.
10. Some enterprises may find the digitalisation journey daunting. Rest assured that ASMI and agencies like ESG and IMDA are available and ready to assist with guidance and advice.
11. Digitalisation can help our enterprises in various ways.
12. Automation and streamlining of workflows through the adoption of digital tools can help increase efficiency and productivity. This will in turn result in cost savings. For example, a local SME, Completion Products Pte Ltd, took proactive steps to digitalise its internal processes with ESG’s support. It implemented an integrated Enterprise Resource Planning solution that streamlined its corporate functions. As a result, the company was able to lower its operating expenditure by 10%.
13. Enterprises can also leverage digitalisation to improve product and service offerings. For instance, ICF International Pte Ltd, another local SME, utilised Virtual Reality (VR) technology to convert their vessel interior designs into 360-degree models with realistic finishes. This offering differentiates them from their competitors and helps their clients visualise the actual 3D designs of the vessels.
14. In addition, digitalisation can help enterprises upskill their workers. Completion Products and ICF International understand this well. Mr. Ismail Bin Abdullah, 51, a Quality Specialist in Completion Products, is now able to generate accurate reports at the click of a button after he learnt how to use the company’s Quality Management System (QMS). This saved him close to two hours per day compared to the previous manual process! He has become more productive as he can now do other work with the time saved. Mr Ayyakkannu Manimaran, 45, a Senior Project Manager in ICF International, is now able to extract drawings and process purchase requests remotely through the company’s Virtual Private Network (VPN). In the past, hardcopy manual processes took up about half of his day. This has freed up time for him to focus on other higher value tasks.
M&OE IDP to Make the Digitalisation Journey Easier
15. I am excited to launch the Industry Digital Plan (IDP) for our M&OE sector today. Jointly developed by ESG and IMDA, the IDP is a guide to help M&OE enterprises assess your digital readiness and assist you in your digitalisation journey.
16. The IDP comprises of two roadmaps. First, it helps enterprises identify gaps in their digital capabilities and provides a step-by-step guide to help SMEs identify the digital solutions that can be adopted at three stages of growth. Second, as upskilling the workforce is vital for enterprise growth, the IDP has a Digital Training Roadmap which charts out the skills needed for various job roles.
17. I would like to take this chance to urge all our M&OE enterprises to take the first step in digitalisation, if you have not started. There is no “one-size-fits-all” solution – every digitalisation journey is different, with each journey tailored for specific needs. Get started. Understand your current needs. Find out how digitalisation can address these needs.
18. Let’s press on and continue to build new capabilities as we weather the COVID-19 storm together. I am confident that our M&OE sector will continue to be a source of pride for Singapore and Singaporeans for generations to come.
19. Thank you.