Speech by Minister Lim Hng Kiang at the Singapore - Malaysia Business Forum 2014 at Raffles City Convention Centre

Your Excellency Dato’ Sri Mustapa Mohamed, Minister of International Trade and Industry, Malaysia

Dato’ Husni Zai Yaacob, High Commissioner of Malaysia to Singapore

Dato’ Azman Mahmud, CEO of Malaysian Investment Development Authority

Datuk Dr. Wong Lai Sum, CEO of Malaysia External Trade Development Corporation

Mr Ho Meng Kit, CEO of Singapore Business Federation

Distinguished Guests,

Ladies and Gentlemen,

Introduction

1.         A very good morning to all of you. Let me first welcome all our Malaysian friends and colleagues to Singapore. It gives me great pleasure to join you at this morning’s Malaysia-Singapore Business Forum. I would also like to thank Minister Mustapa and MIDA for inviting me to this forum.

2.         The annual

Singapore-Malaysia Business Forum is an important platform for businesses to obtain updates on the latest developments and opportunities in Malaysia. This forum also strengthens the networks and links between Malaysian and Singapore companies.

Positive Momentum for the Malaysia-Singapore Relationship

3.         Singapore and Malaysia enjoy a deep and longstanding relationship. Over the years, bilateral trade, investment and people-to-people flows have continued to deepen. In 2013, Malaysia remained Singapore’s top export destination while Singapore was correspondingly Malaysia’s top export destination.

4.         The close ties between our governments are underscored by the recent State Visits and the successful 5th Malaysia-Singapore Leaders’ Retreat held in Putrajaya in April this year. Ties are equally strong at the business-to-business level. In June this year, I had the honour of joining Minister Mustapa at the Groundbreaking Ceremony of Nusajaya Tech Park. The Park, currently jointly developed by Ascendas and UEM Sunrise, reflects an exemplary model of bilateral collaboration between companies of Malaysia and Singapore.

Deepening Regional Economic Integration

5.         Beyond our strong bilateral ties, Singapore and Malaysia share a common vision on regional issues, thus reinforcing already strong bilateral ties. Both countries recognize the value of deepening regional integration which will bring about better jobs, higher wages and higher standards of living for both our people. Integration will also benefit businesses, as trade liberalisation and regulatory coherence will reduce cost, improve productivity, and facilitate the participation in the global supply chain.

6.         Singapore and Malaysia are therefore working closely to realise regional integration initiatives such as the ASEAN Economic Community (AEC), the ongoing Regional Comprehensive Economic Partnership (RCEP) and the Trans Pacific Partnership (TPP) negotiations.

7.         The AEC has seen solid progress being made towards transforming ASEAN into a single market of 600 million people. The outlook for ASEAN is positive. With a burgeoning middle class and a young labour force, ASEAN is both an attractive consumption and manufacturing base.  By 2015, ASEAN-based businesses will benefit from a more integrated production base in the region and enjoy the same treatment as local businesses.  This will level the playing field in ASEAN, making it cheaper and easier to do business in the region. 

8.         While I have said that progress has been good, realising the AEC 2015 is not without its challenges. It requires ASEAN Member States to take the necessary steps in aligning their domestic regulations and policies to the AEC commitments. Non-tariff barriers, for instance, need to be addressed to enable freer flow of trade in ASEAN. ASEAN Member States also face the challenge of committing to higher thresholds of services liberalisation before the end of 2015. With 2015 less than a year away, both Malaysia and Singapore recognize that more needs to be done for ASEAN to stay on track in the realisation of the AEC 2015.

9.         Besides re-doubling our implementation efforts, ASEAN has also commenced work on key messages to reach out to businesses on the benefits of AEC 2015, so that businesses are ready and able to capitalise on the opportunities offered through deeper integration. At the national level, Singapore is also working to enhance our AEC 2015 media and communications plan. As 2015 approaches, we, like Malaysia, will continue to ramp up our engagement with the various business councils and industry associations to raise awareness.

10.       Singapore and Malaysia are also participating in ongoing negotiations on the Trans Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP). The TPP involves 12 countries on both sides of the pacific, and aims to integrate 40% of the world’s GDP. As a high-quality agreement which goes beyond traditional trade issues, the TPP is an opportunity for countries to address challenges faced by modern businesses and to better reflect new and evolving trade practices. The RCEP comprises ASEAN and the markets of our six regional partners. Like the TPP, RCEP will lower trade barriers, facilitate trade and deepen regional economic integration. This is another significant very initiative to transform the region into an integrated market comprising over 3 billion people and one third of the world’s GDP. With our markets better integrated, we will be more attractive and competitive.

11.       While these gains are not without challenges, I remain positive that various stakeholders will value the strategic importance and long term benefits of these agreements.  

12.       Ladies and Gentlemen, Malaysia will take over the ASEAN Chairmanship next year. We look forward to continuing to work closely with Malaysia and other ASEAN Member States on realising the AEC and working towards the conclusion of the TPP and RCEP negotiations. 

Conclusion

13.       In conclusion, bilateral economic relations between Singapore and Malaysia continue to grow from strength to strength.  The array of opportunities arising from our strong and multifaceted partnership has catalysed mutual trade and investments. I therefore urge companies in both countries to build on the positive inroads made and to seize opportunities for stronger cross-border collaboration.

14.   On this note, I wish you a productive session ahead. Thank you.