Lim Hng Kiang at the Launch of the Marine Capability Development Programme

Mr Michael Chia,  President of the Association of Singapore Marine Industries

Distinguished Guests,

Ladies and Gentlemen,

Good morning. 

Introduction

I am very pleased to join you this morning. As Mr Michael Chia has just highlighted, the marine industry has seen impressive growth in the last few years. I am told your order books are full for some time to come, thanks to the positive global outlook and the continued rise of the Asian economies.

Singapore’s economy registered a strong growth of 9.4% in the first half of this year. Despite this strong performance, it is important that we constantly remind ourselves of the increasing global competition, especially from lower-cost competitors. In the marine industry, competitors from China and the Middle East are fast emerging as strong players. Lower costs, coupled with higher value-added activities, are making them increasingly attractive to our long-term partners and customers.

To meet the challenges ahead, our enterprises have to be vigilant and strive to raise productivity and move up the value chain. They need to continuously upgrade their capabilities and offer more innovative products and services to stay competitive.

Capability Development Programme (CDP)

The government is committed to supporting the upgrading efforts of our local enterprises, for example through private-public partnerships such as the Local Enterprise and Association Development or LEAD programme. Today, I am pleased to announce the new $35 million Capability Development Programme, or CDP for short.

While LEAD is industry association-led and targets industry-wide capability needs, CDP complements LEAD by focusing on capability development at the enterprise level. Examples of projects that can be supported under CDP include: process improvements through the adoption of continuous improvement techniques such as Six Sigma or Kaizen; development of new and innovative products or services; and certification of products and process certification to international standards. The CDP is an industry-specific programme and, over the next few months, SPRING Singapore will roll out the CDP to various industries.

Marine Industry First to Benefit

The marine industry will be the first to benefit from CDP. SPRING Singapore will set aside $8 million from the $35-million CDP to develop the capabilities of our marine enterprises over the next five years. The Marine CDP is expected to generate $240 million in value-added for the industry.

Marine SMEs will be able to leverage on the Marine CDP to work on either consortium or individual enterprises projects. For consortium projects, shipyards can proactively identify areas in which the marine SMEs can better support them. With a more competent group of supporting SMEs, the shipyards will be able to take on more jobs, or undertake higher value-added ones. Consortium projects can also be undertaken by a group of SMEs to build on their complementary strengths and offer a holistic, integrated solution to customers. This allows the SMEs to collectively bid for bigger projects or negotiate for better terms. The Marine CDP can also help SMEs to embark on capability development projects to enhance their individual competitiveness.

I am happy to learn that some of our SMEs have already taken the initiative to upgrade capabilities on their own. For instance, four companies – Jason Electronics, Heatec Jietong, Entraco and Seah Marine Engineering – are already implementing the Kaizen programme for continuous process improvement. Let me give you an illustration of how Kaizen is applied.Using Kaizen techniques, Jason Electronics is able to optimise its supply chain by reducing its inventory levels, while maintaining high service standards and timeliness of deliveries. I will leave Jason Electronics and Heatec Jietong to share more details on their insights and their experience in implementing Kaizen. I hope that through their sharing, more enterprises can follow in their footsteps to upgrade your capability.

Encourage Participation from Marine Enterprises

What the Government can do and has done through the CDP is to provide some resources and guidance to encourage our enterprises to embark on these upgrading efforts. The rest is really up to you, the industry and the enterprises. I urge all of you, SMEs as well as shipyards, to leverage on the Marine CDP to upgrade and move up the value chain. With such partnerships in place, I am confident that the marine industry will continue to create new value, sustain good growth and provide more meaningful jobs in Singapore.

On this note, I wish all of you a fruitful and rewarding time at the event this morning. Thank you.