Mr Lim Hng Kiang at the Local Enterprise and Association Development (LEAD) Forum, “Championing The Next Phase Of Growth”, 15 Oct 2010

OPENING SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE AND INDUSTRY AT THE LOCALENTERPRISE AND ASSOCIATION DEVELOPMENT (LEAD) FORUM, “CHAMPIONING THE NEXT PHASE OF GROWTH”, ON FRIDAY, 15 OCTOBER 2010, 10.00AM, AT RAFFLES CITY CONVENTION CENTRE

Good Morning

Ladies and Gentlemen

It is my pleasure to join you this morning for the Local Enterprise and Association Development or LEAD, Forum. This is the 5th year since the launch of the LEAD programme and I am pleased to note that much progress has been made. We now have 22 Trade Associations and Chambers (or TACs) taking the lead in driving development within their sectors and developing initiatives to improve the capabilities of companies.

Review of Singapore’s business landscape

Last year was a difficult year for many businesses. The world went through its worst economic downturn since the great depression. Since then, the global economy has stabilised and is now recovering.Indeed, Singapore has emerged from this crisis stronger and fitter in many ways. The Singapore economy remains on track to achieve the overall growth forecast of 13 to 15 per cent for the whole of 2010. Singapore was also recently ranked as the most competitive nation in Asia and the 3rd most competitive globally by the WEF Global Competitiveness report. The report assesses countries based on three levels of country development; factor-driven requirements, efficiency-driven requirements and innovation-driven requirements. As a testament to the stability of our economy, Singapore took the top spot for the factor and efficiency-based criteria.

Our global ranking in innovation has also improved from 11th to 9th. However in comparison to the other criteria, this is still a low ranking and an area in which we need to improve on. This same observation was made by the Economic Strategies Committee (ESC) in its recommendations earlier this year. The ESC noted that in order for Singapore to shift towards productivity driven growth, Singapore businesses must innovate, they need to make greater use of technology and start adopting more modern and sophisticated business processes. And this is where Trade Associations and Chambers (or TACs) as industry champions can play a key role in helping Singapore businesses to innovate, raise their competitiveness and achieve sustained growth.

TACs as industry champions

A good example of such an industry champion is the Association of Aerospace Industries (Singapore) or AAIS. AAIS has been actively promoting the AS9100 certification amongst its members. This is an industry certification recognised by Original Equipment Manufacturers (OEMs) and Tier 1 suppliers around the world as a supplier-qualification prerequisite. To date, the association has facilitated the certification of close to 20 aerospace manufacturers and suppliers. This is a significant achievement as there are only an estimated 80 companies holding such a certification island-wide.

AAIS is just one of the many LEAD associations who have been actively leading their industries to improve. 22 associations are now part of LEAD and I commendthem on the progress they have made in the areas of capability building, internationalisation and manpower development for their sectors.

Through LEAD, these 22 TACs have invested $91 million in various upgrading and market development projects and supported more than 8,000 enterprises.These projects are expected to generate more than $1.6 billion of value-add and $4 billion of revenue upon completion.

Our LEAD TACs have also been instrumental in helping companies venture abroad. In the last five years, they have organised a total of 130 overseas missions and 50 trade fairs. More than 1,700 enterprises participated in these missions and fairs with projected overseas sales of over S$135 million. In terms of capability upgrading, LEAD TACs have started over 20 capability building projects, involving 1,800 enterprises. Through workshops and courses, they have helped to upgrade the skill-sets of more than 21,000 workers.

Take for example the Franchising and Licensing Association or FLA. In a tie up with the US-based Institute of Certified Franchise Executives, FLA aims to enhance the professionalism of franchising by certifying the highest standards of quality training and education through the Certified Franchise Executives (CFE) programme. As of the last quarter of 2009, 35 executives have enrolled for the Certified Franchise Programme. Another 250 have benefited from FLA’s annual Franchising Symposium.

LEAD programme – the next phase

To sustain this momentum, we need to move into the next phase of the LEAD Programme where we will focus on empowering associations to take on greater responsibilities and roles. The three key focus areasare:

1. Accelerate productivity improvement & capability upgrading of industries and enterprises

2. Activate internationalisation efforts for able and willing enterprises, and

3. Advance association capability

Currently LEAD TACs already play a key role in spurring their members to increase productivity at the enterprise level. But their role is particularly important at the industry-wide level. Here, they work with government economic agencies in national and industry level plans to identify and fill sector gaps and so doing, boost productivity levels in their sector.

Increasingly, companies are looking abroad to expand their markets. To help generate more business leads and garner global mindshare, TACs will need to organise even more trade missions and Singapore Pavilions at international flagship fairs and events. Following the success of international branding initiatives like Singapore Mozaic under the Singapore Furniture Industries Council (SFIC), and Tasty Singapore under the Singapore Food Manufacturers Association (SFMA), more TACs are also keen to invest in industry branding.They recognise that this helps build market mindshare and heighten customer engagement.

And even as TACs continue to take on greater roles and responsibilities, they will also need to build up their own capabilities. In this regard, I am pleased to announce that IE Singapore and SPRING are developing an Association Capability Enhancement Framework which will provide a structured approach towards upgrading the associations’ capabilities.

The Framework will cover areas such as corporate governance and transparency; intelligence gathering; financial management and sustainability; communications and marketing and membership and industry representation. More details on this Framework will be provided in due course.

In addition, IE and SPRING will also provide TACs with support in skills upgrading for association executives. The agencies will work with the Singapore Business Federation and the American Society of Association Executives on a series of workshops and programmes to raise the professionalism of association executives.

Five years ago, when I launched the LEAD programme I spoke of the need to adopt an “Industry-led and Government-backed” approach in order to achieve the next stage of growth. Since then, many of our TACs have come forward to take the lead in industry development efforts. Today I am pleased to welcome three more new associations who are joining the LEAD programme. They are the Singapore Semiconductor Industry Association (SSIA), Singapore Venture Capital & Private Equity Association (SVCA) and the Singapore Jewellers Association (SJA).

Conclusion

As the global economic recovery gains firmer footing, opportunities particularly in Asia are emerging. Our companies must be prepared to seize the initiative. More than ever, TACs will have a key role to play in building up industry and enterprise competitiveness, strengthening capabilities and leading in internationalisation efforts.I am confident that with the support of TACs, we will build deeper industry and enterprise capabilities and expertise that will help bring about sustained economic growth for Singapore.

On this note, I wish you all a pleasant and fruitful morning. Thank you.