Speech by Minister Gan Kim Yong at the Singapore-China Trade and Investment Forum

Mr Chua Teng Hoe, Shanghai Consul-General,
Ms Chong Ee Rong, Vice Chairman of the Singapore Business Federation,
Distinguished guests,
Ladies and gentlemen,

1. Good morning. It is my pleasure to join you today for the Singapore-China Trade and Investment Forum (SCTIF) virtually from the Singapore Business Federation’s office in Singapore, which is the satellite venue of this year’s Forum.

2. First, I would like to express my appreciation to SBF, for organising the Forum. The annual SCTIF serves as an important platform for Singaporean and Chinese business leaders, entrepreneurs, and trade delegation to meet each other, make new acquaintances and broaden their networks.

3. The theme for this year’s forum is “Singapore-China: Accelerating Business Growth Together”. As the global economy recovers from the impact of the COVID-19 pandemic, we are facing several new challenges arising from climate change, geopolitical tensions, and rising inflation. Let me first sketch out what these challenges are, what companies can do to overcome them and seize the opportunities, and the Government’s role in supporting these efforts.

Greater uncertainty in Today’s World

4. Over the past few months, we saw extreme weather disrupt agriculture production, with flooding and extreme temperatures exacerbating already strained global supply chain for energy and food. The Ukraine war and geopolitical tensions also created significant uncertainties. According to the International Monetary Fund (IMF), inflation has reached its highest since 1982 in advanced economies, and since 1999 in developing economies. Central banks are tightening monetary policy and raising interest rates to dampen inflation, which would inevitably slowdown the global economy.

5. IMF has forecasted that global growth will slow from 6% in 2021 to 3.2% this year and 2.7% in 2023. The OECD has also removed USD 2.8 trillion from its 2023 global GDP projection due to geopolitical conflicts.

6. However, while the outlook is gloomy, we need not be overly pessimistic. Allow me to share a Chinese saying – “青山缭绕疑无路，忽见千帆隐映来”. Sailing down a winding river between tall mountains, the journey seems to have reached the end of the river. Suddenly we see many boats heading towards us, showing us the way ahead. English equivalent is there is always light at the end of the tunnel. I would like to encourage our companies to stay the course, remain open to opportunities, be prepared to transform and look for new roads to forge ahead.

Seizing Growth Opportunities

7. As the world evolves under the challenges, companies must remain nimble and adapt accordingly, to stay relevant and continue to grow. We can do so in three ways.

8. First, we need to remain connected, which includes not only physical connectivity but also digital connectivity. China’s digital economy has grown even more important since the pandemic, and was valued at USD 7.1 trillion in 2021, forming close to 40%^[1] of its GDP. On the consumer side, China’s e-commerce livestream sector is expected to attract 660 million viewers and achieve USD 180 billion in total revenue this year. Online retail sales have exceeded USD 1.58 trillion in 2021 and accounted for almost a quarter of China’s total retail sales.

9. Singapore companies should tap on these opportunities to further their growth. For example, Ble De Fonty, a skincare brand started by UGEL Cosmetics in Singapore, has successfully developed an online-to-offline distribution network within 18 months, with online retail sales accounting for 80% of their revenue. They have leveraged major Chinese e-commerce and social commerce platforms to sustain brand engagement with their customers.

10. Second, we must ensure our growth is sustainable. Singapore and China are both working towards reducing our carbon footprints and achieving more sustainable economic growth. Singapore has committed to achieve net zero emissions by 2050, and China has a 2060 carbon neutrality target. Companies providing sustainable solutions should seize these opportunities. For example, Singapore’s Sembcorp, an energy and urban solutions provider, has renewables present in more than 13 provincial regions across China, with 3.6 gigawatts of renewable energy capacity in operation and under development.

11. Third, innovation. Innovation can be an engine for growth to increase productivity and provide more efficient ways of conducting business. For example, Glee Trees, a solution provider that leverages on A.I. to develop their software ‘Gleematic’, which can complete end-to-end processes automatically such as reading data from invoices to updating data into any I.T. systems.

12. We must not be afraid to venture into new and emerging opportunities. An example is Yeo Hiap Seng, a well-known Singapore based regional F&B manufacturer that partnered with Sweden’s Oatly to manufacture Oatly’s proprietary enzyme-treated oat milk at Yeo’s Singapore plant. With demand for dairy alternatives growing in Asia, including China, companies like Yeo’s are actively venturing beyond their traditional portfolio of drinks to tap into these new growth areas.

Governments’ Role in Supporting Companies

13. As businesses venture forth to harness these opportunities, the Singapore Government will provide greater support. Singapore maintains strong bilateral economic relations with China underpinned by frequent high-level exchanges. Just last week, we concluded the 18th Joint Council for Bilateral Cooperation (JCBC) co-chaired by both countries’ DPMs, where we signed 19 new agreements on strengthening cooperation in innovation, e-commerce, deepening green development, and more. This will support companies in our two countries in deepening their collaboration in innovation, and sustainable growth.

14. Our three Government-to-Government (G-to-G) projects in Suzhou Industrial Park, Tianjin Eco-city, and China-Singapore (Chongqing) Connectivity Initiative serve as good pathfinders. We are also supported by our eight Provincial Business Councils (PBCs) in Guangdong, Jiangsu, Liaoning, Shandong, Sichuan, Tianjin, Zhejiang, and of course, Shanghai. The PBCs offer invaluable support to our businesses’ growth in multiple cities across China. I hope you will be able to seize the wealth of opportunities in China.

Closing

15. China remains an important export market. The Chinese Government has indicated that it will continue to welcome foreign companies and investors to participate in its economic growth. The China International Import Expo (CIIE) itself is a signal of the importance China places on foreign trade and investment.

16. Thank you SBF, for leading Singapore’s participation in the CIIE, and the 50 Singapore companies here for representing Singapore.

17. I look forward to the meaningful dialogue session, and I wish everyone a fruitful time at this Trade and Investment Forum and CIIE 2022.

Thank you.

[1] Source: China Academy of Information and Communications Technology (CAICT), “Report on the Development of China’s Digital Economy (2022)”, published in July 2022,  www.caict.ac.cn/english/research/whitepapers/202208/P020220819505049573088.pdf