Mr Teo Ser Luck at the Asia Pacific Food Expo 2013

SPEECH BY GUEST-OF-HONOUR, MR TEO SER LUCK MINISTER OF STATE FOR TRADE AND INDUSTRY, AT THE ASIA PACIFIC FOOD EXPO 2013 22 NOVEMBER 2013, 7.10PM AT THE SINGAPORE EXPO HALL 4

Mr Thomas Pek, President, Singapore Food Manufacturers’ Association,

Distinguished Guests,

Ladies and Gentlemen,

Good evening.

1.           I am pleased to join you today at the opening ceremony of the 10th Asia Pacific Food Expo 2013.

Local food industry

2.           Singapore’s food industry is a vital sector in our economy, and has seen good growth in the past five years[1]. Today, it employs 127,000[2] workers and contributes approximately 1.6%[3] to Singapore’s GDP.

3.           However, local food manufacturers and restaurateurs face many challenges. The overall labour market is tightening as the economy restructures to reduce our foreign worker dependency. The local food industry is also becoming increasingly crowded. How then can the industry continue to grow?

Staying competitive through innovation and productivity improvements

4.           First, we need to embrace these structural changes and aggressively pursue innovation and productivity improvements to sustain quality growth. BreadTalk is a prime example of an innovative company that was able to develop interesting and original designs and flavours that have completely shaken up the once-traditional bakery sector through R&D. It has also embraced the “open kitchen” concept in its shops, leveraging functional space to promote sales through a more visual and engaging customer experience.

5.           I am heartened to know that local firms have heeded the Government’s call for increased productivity. In 2011, the Government introduced two productivity plans that were specifically targeted at these sectors. Since then, more than 850 firms have embarked on productivity and service upgrading projects. For instance, Chew’s invested in a Laser Marking and Coding System for egg-grading, which is a groundbreaking and environmental-friendly technology in the egg industry. With this, Chew’s was able to reduce its maintenance costs by 95%, while increasing the number of eggs graded by 40%.

Quality growth through greater collaboration within the industry

6.           Second, companies should work collaboratively to achieve win-win growth together. For instance, Singapore Food Manufacturers’ Association (SFMA), the Singapore Manufacturing Federation (SMF) and the Restaurant Association of Singapore (RAS) have utilised SPRING Singapore’s Collaborative Industry Project (CIP) grant to assist restaurants with the outsourcing of non-core food item preparation to food manufacturers. This helps restaurants focus on their key business processes and reduce their manpower needs. The food manufacturers can tap greater economies of scale to improve efficiency through technology.

7.           Our SMEs with fewer resources can also partner larger companies for co-innovation, knowledge and capabilities transfer, as well as the training of specialised labour. The Government recognises that it has a role to play in encouraging this, which was why we expanded the Partnerships for Capability Transformation (PACT) programme in April this year. 

Encouraging growth through internationalisation

8.           Third, given our small domestic market, it is imperative for our companies to grow their businesses regionally or internationally. IE Singapore’s Global Company Partnership (GCP) and Market Readiness Assistance (MRA) schemes assist companies with the development of their internal capabilities, facilitation of entry into foreign markets, and enhancement of their market presence. I am pleased to note that the number of food companies that IE has helped via its grant programmes has been increasing with a CAGR of 4 % from 2009 – 2013[4].

Conclusion

9.           In conclusion, I hope that local food companies will continue to pursue these strategies and work towards establishing Singapore as a top culinary city and food manufacturing hub.

10.       To this end, the Asia Pacific Food Expo continues to be an excellent platform to bring together regional industry players to promote innovation, productivity, collaboration and cross-border business opportunities. I would like to congratulate SFMA on the successful 10th anniversary run of this event and wish all of you a fruitful time.

11.       Thank you.

[1]

Over the past five years, the food manufacturing sector achieved 11% average growth in total sales and a 14% annual growth in direct exports. Likewise, the food services sector saw 9% average growth in total operating receipts.

[2]

This accounts for about 4.4% of Singapore’s total employment.

[3]

Source: DOS 2011 Economic Survey Series; EDB Census of Manufacturing 2011.

[4]

Source: IE Singapore, 2013.