Speech by SMS Koh Poh Koon at the 2018 Singapore Semiconductor Industry Association Summit

SPEECH BY GUEST-OF-HONOUR DR KOH POH KOON, SENIOR MINISTER OF STATE FOR MINISTRY OF TRADE AND INDUSTRY & MINISTRY OF NATIONAL DEVELOPMENT AT THE 2018 SINGAPORE SEMICONDUCTOR INDUSTRY ASSOCIATION SUMMIT, ON 1 MARCH 2018, 9.00AM, AT MARINA BAY SANDS EXPO AND CONVENTION CENTRE

Mr Francois Guibert, Chairman of the Singapore Semiconductor Industry Association (SSIA),

Mr C. K. Tan, President of the SSIA,

Distinguished Guests,

Ladies and Gentlemen,

Good morning.

1.            It is my pleasure to join you here for the Singapore Semiconductor Industry Association (SSIA) Summit 2018.

2.            The theme of this year’s summit – "Disruptive Technologies and Transformation of Electronics Businesses" – highlights both the increasing challenges faced by businesses from disruptive technologies as well as the opportunities that lay ahead if we are able to ride the wave of transformation. 

Electronics continues to be a key growth sector for Singapore’s economy

3.            Electronics is a key pillar of Singapore’s manufacturing sector, accounting for more than a quarter of our manufacturing gross domestic product (GDP), at about S$90 billion.  In 2017, output of the electronics cluster grew by more than 30% compared to 2016, supported by strong growth in the semiconductors segment which made up close to two-thirds of the Electronics manufacturing GDP.  With demand in the global electronics and semiconductor equipment markets expected to remain firm, the Electronics sector should continue to expand in 2018, albeit at a more moderate pace. 

4.            While the outlook remains positive, new technologies are disrupting the industry and businesses will need to continuously innovate to remain relevant and stay ahead of the competition.

Disruptive technologies will transform and catalyse new growth in the industry

5.            Disruptive technologies, such as artificial intelligence, robotics and the Internet of Things (IoT), have been and will continue to transform industries and catalyse new growth areas.  The Electronics industry is no exception to this trend, and we are already seeing advancements in manufacturing, in areas such as the increased use of sensors, more connected equipment, green energy solutions and more.  I am pleased to note that many of our Electronics companies today already have a high level of automation and robotics in their manufacturing plants, which has helped to improve the productivity of their operations and leverage existing manufacturing capacity.

6.            As new applications for these advanced technologies continue to emerge, there will be a new wave of demand for electronics that are smarter, faster and more efficient.  The industry must be prepared to capitalise on these trends and growth opportunities to attract new investments and persify into new markets through innovative solutions and products.

The Government will continue to partner industry to support innovation and capture growth opportunities

7.            Enabling our industries and supporting our firms and workers in their transformation efforts to prepare for the challenges and opportunities in the future economy, is a key priority for Singapore.

8.            We launched the Electronics Industry Transformation Map (ITM) last September, which has identified innovation, productivity, skills and internationalisation as key drivers for long-term growth of the Electronics industry.  In addition, the ITM is a collaboration among all industry stakeholders including unions, as well as the Trade Associations and Chambers (TACs) who play a critical multiplier role in our industry transformation efforts.  To this end, TACs like the SSIA have been a key partner for the Electronics ITM, leading the charge to forge partnerships in the development of new technologies and talent for the industry.

9.            The Government will also continue to support TACs in leading industry upgrading initiatives through the Local Enterprise and Association Development (LEAD) Programme under SPRING and IE Singapore. With the two agencies’ upcoming merger to form Enterprise Singapore in April, TACs and companies will be able to receive more holistic support in capability development and internationalisation.  

Strengthening our local ecosystem through partnerships and open innovation

10.         Singapore’s semiconductor industry is one of the largest in the Asia-Pacific region and is also home to some of the largest players in the industry, ranging from integrated device manufacturers and wafer foundries to outsourced assembly and test services companies – many of whom are members of the SSIA.  This puts the SSIA in a good position to bring together companies to collaborate and drive greater innovation, productivity and growth holistically.

11.         Our semiconductor industry is also supported by a strong supplier ecosystem, with some of the top semiconductor equipment companies here undertaking a range of manufacturing, research and development and headquarters activities.  I am heartened that the SSIA has taken steps to promote closer collaboration not only between large organisations but also between the electronics multinational corporations (MNCs) and small-medium-enterprise (SME) suppliers.  For example, at its recent inaugural Automation Supplier Day for the Semiconductor and the Electronics industry, industry players came together to discuss automation solutions, share best practices in smart manufacturing innovations and showcase the latest technologies.  The event also saw 20 potential suppliers pitching their proposed solutions to 10 MNCs, and is the first of a series of supplier pitching sessions for the Electronics industry.

12.         For companies keen to explore partnership opportunities with fellow enterprises, I encourage you to take advantage of the PACT scheme, which is administered by the Economic Development Board and SPRING, soon to be Enterprise Singapore. As announced by the Minister of Finance in his Budget 2018 speech last month, PACT will be enhanced to support collaborations between companies of all sizes, in areas such as capability upgrading, business development and internationalisation.

13.         In today’s highly competitive environment, it is imperative for Singapore to differentiate ourselves through our innovation capabilities for sustained growth.  Open innovation can play a key role for businesses to co-develop new solutions with partners from both within and outside of the Electronics sector.

14.         I am thus pleased to launch the SSIA’s Complex Equipment Consortium (CEC) today, which aims to bring together MNCs, SMEs and institutes of higher learning (IHLs) on a private-private-public approach, to explore opportunities for co-innovation in specialty capabilities, new technologies and productivity, for example in niche assembly, predictive maintenance and data analytics.  This is very much in line with the Committee on the Future Economy’s recommendation for our companies to partner each other to enable innovation and growth.

15.         The IoT Open Innovation Community by Nanyang Polytechnic’s Centre of Innovation for Electronics is another such platform which brings together more than 130 members across enterprises, technology partners and public institutions to collaborate, experiment and exploit the potential of the IoT for new business innovations.  Through this platform, many companies have successfully developed and commercialised new solutions. This is an encouraging step and I welcome more of such open innovation platforms to help our businesses be agile co-creators and users of disruptive technologies. This will also help deepen the capabilities of our companies and strengthen our eco-system as a whole.

Conclusion

16.         The Electronics sector has been a key sector of growth for Singapore and is well-positioned to face the challenges from disruptive technologies.  As the saying goes, if you want to go far, go together. We have laid the groundwork for closer collaboration among the industry stakeholders and I am confident that we will continue to build on our collective strengths to ensure sustained growth for the industry.

17.         I would like to recognise SSIA for their continued contributions to our semiconductor industry, and wish everyone a fruitful time at the Summit.  Thank you.