Mr Lim Hng Kiang at the NTUC Aerospace & Aviation Cluster National Day Observance Ceremony 2010, 5 Aug 2010

SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE & INDUSTRY AT THE NTUC AEROSPACE & AVIATION CLUSTER NATIONAL DAY OBSERVANCE CEREMONY 2010 ON THURSDAY, 5 AUGUST 2010, 3.30PM, AT SIA ENGINEERING COMPANY

Mr. Stephen Lee, Chairman, SIA Engineering Company

Mr. William Tan, CEO, SIA Engineering Company

Mr. Heng Chee How, Deputy-Secretary General of NTUC

Ms. Josephine Teo, Assistant Secretary of NTUC

Mr. Martin Chan, Chairman, NTUC Aerospace & Aviation Cluster

Distinguished Guests,

Ladies and Gentlemen

Introduction

I am pleased to be here this afternoon at the NTUC Aerospace & Aviation Cluster National Day Observance Ceremony 2010 to mark our nation’s 45th National Day.

Aerospace and Aviation Industry in Singapore

Singapore is proud of the achievements of our aviation and aerospace companies and workforce. The sector has been, and still remains, a key growth engine for our economy. Since 1990, the industry has been growing by an average of over 12% each year, and we have blossomed into one of the most comprehensive hubs in Asia. In 2009, despite the recession in the early part of the year, the industry still managed to maintain an output of $7 billion. Confidence in the sector remains strong, and we expect it to continue growing in future years.

Globally, the aerospace industry is also expanding. Much of that growth is driven by Asian demand, and Singapore is well-positioned for this. We have over 100 companies in this sector, and they account for a quarter of Asia’s Maintenance, Repair and Overhaul (MRO) market. Singapore has been ranked the best center in Asia for MRO. Changi Airport is regularly ranked among the best air hubs in the world, and many airlines prefer to come through Singapore so they can enjoy the efficient one-stop service that we provide. The Singapore Airshow has also made its mark as one of the top international airshows.

The Government has invested heavily in the aerospace sector, and will continue to support its development. As part of the re-development of Seletar Airbase into a 300-hectare Seletar Aerospace Park, both the road networks and airport infrastructure have been upgraded, including an extension of the runway. This will be a good platform for our aerospace companies to soar to even greater heights from.

Key Projects

Singapore companies are doing very well. During the Singapore Airshow this year, SIA Engineering Company officially opened “Hangar 6”, which will be the first custom-built hangar in the world for the A380. Singapore Aero Engine Services Limited announced expansion plans for their Trent engine maintenance and repair facility. Singapore has also managed to attract a significant investment from Rolls Royce, to manufacture their high-end Wide Chord Fan Blades and assemble and test their latest Trent aero engine engines. Our companies should continue to find ways to collaborate with these leading firms and with each other, to reap the synergies of being co-located.

Workforce Upgrading and Productivity

The success of these projects, and the aviation and aerospace sector as a whole, depends on skilled manpower as much as it does on technology. In 2009, the sector employed more than 18,000 people. As the aerospace industry continues to grow, we must recognize that improving our productivity is the only sustainable way to stay competitive. This is a challenge that we must tackle together.

At the national level, we have formed the National Productivity and Continuing Education Council (NPCEC), chaired by Deputy Prime Minister Teo Chee Hean. They will be exploring ways to enhance the productivity of the transport engineering sector as a whole, which includes aerospace and aviation, and will be announcing their plans shortly.

Our unions and the WDA have a major role to play as well. NTUC’s training arm, the Employment & Employability Institute (or e2i, for short) and the WDA are working with companies to develop useful training programs. Under the new “Place and Train Aerospace Technician Programme”, trainees will undergo a 9-month course, consisting of Aerospace Workforce Skills Qualification (WSQ) Higher Certificate Training combined with On-The-Job training at the sponsoring company. Successful trainees will benefit from a higher starting salary, and companies which are on this programme will be able to tap on WDA for significant co-funding support. e2i has already received positive responses from several companies such as Singapore Aero Engine Services Limited (SAESL), International Engine Component Overhaul (IECO), and Singapore Jamco, who will be putting 80 new trainee technicians through this programme in the coming year.

Individual companies have also embarked on productivity initiatives, together with their unions. The Changi International Airport Services (CIAS) and its union, CIAS Employees Union (CIASEU), have already rolled out several initiatives to improve business processes and enhance productivity, which will lead to higher incomes and a better working environment. The Singapore Industrial Services Employees Union (SISEU) is also working with many aerospace companies such as ST Aerospace and SAESL on productivity projects and training initiatives. SIA Engineering Company is also taking great strides in this area. Last November, they launched Phase 1 of their Cheaper, Better & Faster (or CBF) initiative to reduce wastage and enhance productivity. Through this effort, they have saved $10million in productivity gains, and they are naturally keen to move to Phase 2 of their CBF initiatives for even more gains, and to share these gains with the employees.

Conclusion

I commend the efforts of the unions and companies under the aerospace and aviation cluster. Together, you have taken positive steps to address the various challenges faced by your industry. These initiatives are possible because of co-operation between both the unions and companies. Such close co-operation and a shared vision are fundamental to any successful partnership and I congratulate you on your success.

I hope the examples of SIAEC, CIAS and SISEU will encourage more companies in this sector to work on improving productivity and competitiveness. On this note, I wish all of you a Happy National Day.

Thank You.