Mr Lim Hng Kiang at the Official Opening of the German Expo 2006

SPEECH BY MR LIM HNG KIANG, MINISTER FOR TRADE & INDUSTRY AT THE OFFICIAL OPENING OF THE GERMAN EXPO 2006, SUNTEC CITY CONVENTION CENTRE, FRIDAY, 24 MARCH 2006, 10.20 AM

Mr. Michael Glos, Federal Minister of Economics and Technology

Your Excellencies

Distinguished guests

Good morning

It is my pleasure to join all of you this morning for the opening of the German Expo. In particular, I would like to welcome Minister Michael Glos, the German Federal Minister of Economics and Technology, and our friends from Germany who have come to Singapore specially for this Expo. I extend to you a very warm welcome and I hope you have a pleasant stay here.

The German Expo consists of educational seminars, lectures, thematic exhibits and fun-filled activities to showcase German products, services, arts, culture, education, science, technology and even soccer. There will also be opportunities for business networking during the business matching meetings. Visitors to the Expo will thus have a good sampling of all that Germany has to offer. I am happy to be here myself, as this Expo demonstrates the close and friendly relations our two countries have shared for many years.

Singapore and Germany share robust ties in many areas. Germany, the largest economy in the EU, is Singapore’s sixth largest investor in terms of fixed asset investments. It is our 10th largest trading partner, and also Singapore’s largest trading partner in the EU. More than 700 German companies have a presence in Singapore, including large MNCs such as Siemens, BASF, Daimler Chrysler, Infineon, EPCOS, Oiltanking and Schenker, Mittelstände like Trumpf, Dorma, Pepperl & Fuchs and Rohde & Schwarz have also leveraged on their presence in Singapore to expand successfully into the region.

Singapore and Germany also have good ties in other areas such as education, culture and tourism. Last year, more than 150,000 Germans visited Singapore, forming the second largest group of visitors from Europe. Likewise, the excitement is also building up in Singapore as Germany gears up to host the FIFA World Cup in 12 German cities later this year. In Singapore, Melchers from Germany will build the Singapore Flyer, which, when completed in 2008, will be the world’s highest observation wheel at 170 meters above ground level.

The German brand name is a hallmark for quality and reliability. Germany has many attributes that Singapore admires; you have a skilled and innovative workforce, highly creative talent and cutting-edge technology. Likewise for Singapore, we are forging ahead in a knowledge-driven environment, upgrading our skill-sets and intensifying innovation development in the manufacturing and services sectors. These include research and development (R&D), test-bedding, design, production, supply chain management, marketing and headquarter operations.

Manufacturing is critical to both Germany and Singapore. Singapore is committed to maintaining it as a key pillar of our economy with at least 25% contribution to our Gross Domestic Product (GDP). By 2018, Singapore intends to double its manufacturing output to S$300 billion and manufacturing value-add to S$80 billion.

Like Germany, we also consider innovation to be critical for our future growth. The Singapore Government will hence be making significant investments in the next five years, earmarking over S$13 billion to strengthen and promote R&D capabilities. We aim to raise Gross Expenditure on R&D as a percentage of GDP from the current 2.25 per cent to 3 per cent by 2010. To date, we have made significant strides in strengthening our scientific and research base; developing both our local talent as well as attracting talent from abroad.

Many companies, including several of our German partners, bear testament to our R&D strengths. Pepperl & Fuchs has engaged in the development of its sensors here; Infineon has expanded its R&D team to over 300 people to undertake IC design and package development; Siemens VDO has grown its R&D team here significantly and BASF recently announced the set up of its global research center for nanotechnology here. From the creative industries, BMW has chosen to open its first Asian design center in Singapore to tap on our multi-cultural environment.

There are benefits for our two countries to build on our solid foundation of ties to explore and develop new possibilities for cooperation in business, culture and tourism. Singapore can act as a gateway for German companies to broaden its engagement of Asia. We are seeing an increasing number of companies from China, India and Australia investing in Singapore, using us as a springboard for integration into the global economy. Today, there are more than 4,000 Chinese, Indian and Australian companies in Singapore. This opens up an exciting new platform for the over 700 German companies here to collaborate, partner and network with these companies at one location.

I am pleased that TÜV SÜD from Germany, will announce plans today to further strengthen its market position in Asia by making Singapore its regional hub. TÜV SÜDis one of the world’s top three providers of technical services for product quality, safety testing and compliance, management system certification, training and engineering consultation. This afternoon, TÜV SÜD will ink the deal to buy PSB Corp and PSB Cert from SPRING Singapore, the Standards, Productivity and Innovation Board.

I understand TÜV SÜD will also invest another S$70 million in Singapore over the next six years. This is a fine example of yet another win-win collaboration between our 2 countries. For Singapore, this means new capabilities and resources, knowledge transfer and more jobs. This will also deepen and strengthen our testing and certification industry, a key supporting infrastructure for our manufacturing sector.

I welcome more German companies, including the small and medium-sized ones, to come and explore opportunities in Singapore. I am confident that you will find Singapore to be a very convenient and competitive location from which to grow your businesses.

Likewise, Germany is an ideal gateway for Singapore companies to make their foray into Europe. Germany has strong business and cultural ties with the region that Singapore companies will find useful when doing business in Europe. Germany also has world-renowned strengths in the automotive, medical technology and precision engineering industries, attracting many European companies to establish manufacturing and R&D activities in the country. In addition, Germany is a well-known location for industry trade fairs such as the Hannover Fair, the CeBIT, the Frankfurt Book Fair and the Frankfurt Motor Show. Increasingly, Singapore companies are making business trips to Germany and actively participating in the trade fairs.

Platforms like this German Expo play an important role in deepening the understanding between our businessmen. Not only can they learn about trends and opportunities, it also allows our two peoples to network and exchange views, strengthen friendships and make new ones. I am sure that all of you will find this Expo to be fruitful and meaningful. With that, I wish the Singapore German Chamber a very successful Expo. Thank you.