Speech by Minister Lim Hng Kiang at the official opening of the JTC Surface Engineering Hub and the new facility of JEP Precision Engineering Pte Ltd

Mr Png Cheong Boon, CEO of JTC,

Mr Joe Lau, Chairman of JEP Holdings Ltd,

Distinguished Guests,

Ladies and Gentlemen,

Good afternoon.

I am pleased to join you today for the official opening of the JTC Surface Engineering Hub. It was just two years ago when I launched the Hub as the first development in Singapore customised for surface engineering companies. It is a pleasure for me to be here today to officially open this completed facility.

Redevelopment of Older Industrial Estates Supports the Growth of Manufacturing Industries

The manufacturing sector is an important engine of growth for Singapore’s economy, accounting for about 20 per cent of our GDP in 2013. As Singapore continues to grow key manufacturing industry clusters, such as aerospace, clean technology, offshore marine and logistics, we must continue to find creative ways to overcome our land constraints.

One strategy is to achieve higher land productivity by redeveloping areas with lower intensity use. Tanjong Kling exemplifies this approach. It is one of JTC’s older industrial estates, first developed in the 1960s and 1970s. Back then, industrial activities at this estate included the manufacturing of cement, concrete and fabricated metal products.  Companies occupied mainly land-based facilities, and land use intensity was low. Today, the estate has been transformed with the development of high-rise innovative space solutions, such as the JTC Space @ Tanjong Kling, an upcoming Data Centre Park and the Surface Engineering Hub here. As Singapore enters its next phase of growth, the Government will continue to transform more industrial estates in this way, in order to ensure a sustainable supply of land and space for our industrialists.

Apart from improving land productivity, the rejuvenation of old estates also complements our economic restructuring efforts. As the economy shifts to focus on higher value-added activities, revitalising our estates will provide a boost to industries higher on the value chain, as well as create good jobs for Singaporeans. Tanjong Kling, for example, has become a node for more innovation-intensive manufacturing activities. Companies at the forefront of innovation, such as SH Cogent, OCWS, Takasago, Pepperl + Fuchs and Givaudan, have established their operations in this area. The Surface Engineering Hub, in particular, will enhance our surface treatment activities, which provide critical support to many higher value-added manufacturing industries.

The Government’s Firm Support for Surface Engineering Companies

Surface engineering is an important process that modifies the surface properties of components. This enhances their functionality, performance and appearance. A local network of strong surface engineering businesses will improve our manufacturing efficiency, as companies need not transport their goods to other countries for surface treatment. Manufacturing companies will also have greater control over the quality of the treatment processes that their components undergo. It is therefore crucial to enhance the capabilities of our local and foreign surface engineering companies.

SMEs in particular play an integral role in our surface engineering scene. Our surface engineering companies are predominantly SMEs, many of which have developed niche expertise in the surface engineering field. In 2013, the SMEs collectively employed over 3,000 people and generated a total output of almost $414 million. Besides our SMEs, Singapore is also home to global names such as Swiss-based Metalor Technologies, one of the tenants at the Surface Engineering Hub.

The Government is firmly committed to working with surface engineering companies to improve their productivity levels and to reduce their business costs. In 2011, the National Productivity and Continuing Education Council endorsed a 10-year productivity roadmap that aims to increase the long-term productivity of the precision engineering sector, which includes our surface engineering companies.

In addition, the Surface Engineering Hub will allow companies to enjoy significant cost savings. The centralised wastewater treatment plant will enable companies to save up to $300,000 in capital expenditure and up to 15 per cent savings on water treatment costs.

Apart from cost savings, the Surface Engineering Hub enables companies to collaborate with each other. The Hub houses a network of companies along the entire surface engineering value chain. This ranges from surface finishers to equipment suppliers, testing and certification companies, and plating technology researchers. The ease of access to complementary businesses will allow our companies to achieve faster service turnaround and improve their productivity.

Transformation for Growth: JEP’s Success Story

I am glad that we are also celebrating the opening of JEP Precision Engineering’s new facility today. Earlier, I talked about the importance of SMEs to our surface engineering scene. JEP is a good example of a home-grown SME that has continually upgraded itself to adapt to market changes.

Founded in 1990, JEP started with providing generic precision machining services. Since then, JEP has leveraged skills and technology to upgrade its capabilities. For example, JEP sponsored one of its engineering managers, Mr. Koh Khiam Hoe, to attend the Precision Engineering Master Craftsman programme offered by EDB, SPRING and WDA. The programme equipped Mr. Koh with skills to train junior craftsmen on new technologies and industry best practices. Such human capital investments have helped JEP to improve its capabilities.

Today, JEP has gone beyond generic precision engineering to also manufacture aircraft engine casings and subsea oil and gas equipment for the higher value-added aerospace and oil and gas industries. It supports a global clientele. The JEP team also grew in tandem from 60 to 230 staff, achieving a turnover of S$29 million last year.

Today, we welcome JEP on board the Surface Engineering Hub, where it will be conducting tests and processes for titanium and aluminum components. I am pleased to hear that JEP is tapping the centralised wastewater treatment plant. This has enabled JEP to reduce its space requirements and save on upfront capital investment and operating costs. 

Conclusion

The Surface Engineering Hub is a testament to the Government’s commitment to enhancing our SMEs’ competitiveness. We encourage more industry players to leverage such innovative facilities.

On this note, let me congratulate JTC on the successful completion of the Hub. I also like to congratulate JEP on the opening of their new facility and I wish all our companies here every success in the years ahead. Thank you very much.