Speech by SMS Koh Poh Koon at the 31st Singapore 1000 and SME 1000 Awards Incorporating Singapore International 100

SPEECH BY DR KOH POH KOON, SENIOR MINISTER OF STATE FOR NATIONAL DEVELOPMENT AND TRADE AND INDUSTRY, AT THE 31ST SINGAPORE 1000 AND SME 1000 AWARDS INCORPORATING SINGAPORE INTERNATIONAL 100, ON 9 MARCH 2018, 7.10 PM AT THE RITZ-CARLTON MILLENIA SINGAPORE

Mr Ben Elliott, Chairman, DP Information Group and CEO, Experian Asia Pacific,

Mr Max Loh, Managing Partner, ASEAN and Singapore, Ernst & Young,  

Distinguished Guests,

Award Winners,

Ladies and Gentlemen,

Good Evening.

1.         I am very pleased to join you here again this evening at the Singapore 1000 & SME 1000 Awards Ceremony, where we will celebrate the outstanding achievements of some of our most successful and dynamic companies and the people who have been instrumental in driving their growth.  

ECONOMIC OVERVIEW

2.            This year’s awards ceremony comes on the back of a positive year in terms of economic growth, driven in large part by the global economic recovery. Singapore’s economy grew by 3.6% in real terms last year, higher than the 2.4% growth in 2016.

3.            DP Info’s statistics of Singapore 1000 companies, which were based on financial data from June 2016 to May 2017, also paint a similar picture. During this period, Singapore 1000 companies generated a combined profit of S$182.8 billion, a 10.5% increase from the previous year. This was achieved during a period where sales turnover remained relatively flat, highlighting that the increased profits was a result of improved margins and productivity, rather than increased sales volumes.

PREPARING FOR THE NEXT PHASE OF OUR ECONOMIC GROWTH

4.            While these numbers are certainly a cause for celebration, we must continue to press on, and build on our efforts to transform and to prepare ourselves for the future economy. We have just concluded the Committee of Supply debate. Last week, in his Budget round-up speech, the Minister for Finance, Mr Heng Swee Keat, highlighted that the most critical challenge that Singapore faced was in transforming our economy. This is against the backdrop of three key shifts in this coming decade: first, a greater economic tilt towards Asia; second, a rising technological disruption including digital technology; and third, an ageing population in Singapore. These shifts will have a profound impact on our business environment, especially for our Singapore 1000 and SME 1000 companies. It is imperative therefore that our companies start preparing for these changes now, and not wait for the demographic shift to become a reality.

5.            At this year’s Budget, the Government unveiled many pro-enterprise measures, specifically on how the Government is making certain shifts to better support and enable our enterprises to be future-ready. Let me share some of which we have announced over the last couple of weeks.

6.            First and foremost, we are re-looking at our organisational structures and processes to better support and serve our enterprises. The formation of Enterprise Singapore (ESG), through the merger of SPRING and IE Singapore, encapsulates how the Government is transforming itself to better support businesses to build deep capabilities and internationalise. ESG will adopt a more enterprise-centric approach to address the evolving needs of Singapore companies, across different sectors and growth stages.

7.            Moving forward, both ESG and EDB will serve as two critical and complementary agencies that will formulate and implement strategies for the development of industry clusters and enterprises in Singapore.  Both agencies will work closely together to drive greater collaboration between enterprises of all sizes and origins, including large, multinational corporations and small, innovative startups. They will reinforce each other’s strengths, enhance the competitiveness of our industries, and develop Singapore into an even better global trading hub.

8.            Second, we have made a concerted effort to streamline our incentive schemes and processes across the whole of Government.  This is something the industry has been giving us feedback on for some years, and we are taking concrete steps to do so. The key objective here is to build a more pro-enterprise business ecosystem and better support our companies in their growth journeys. For example, we will be introducing the Enterprise Development Grant (EDG), which will combine SPRING’s Capability Development Grant (CDG) and IE Singapore’s Global Company Partnership (GCP) into a single grant to provide customised support for enterprises across the areas of capability development and internationalisation. Some of you may have used these grants before, but end up talking to different agencies and offices. So by streamlining, we provide you with a one-stop shop service. At the same time, for companies looking to collaborate, we have integrated the support measures for enterprise partnerships across various agencies into a single PACT programme, which will support capability building and business development collaborations between enterprises of all sizes, both locally and overseas.

9.            Through these initiatives, we hope to better support our companies to be future-ready and seek growth opportunities. I am pleased to note that there has been a growing interest among our SMEs to internationalise and seek opportunities abroad. This year’s Singapore International 100, which is part of the Singapore 1000 rankings, highlights the importance SMEs place on doing business with our neighbouring countries in Southeast Asia. Of the 50 SMEs with the highest recorded international revenue, more than 40 percent of this was generated out of ASEAN markets, and that is a very encouraging sign. Geographical proximity as well as cultural familiarity means there are fewer barriers to trading goods and services among Singapore’s neighboring countries. That is a distinct advantage for Singapore companies which we all ought to capitalise on. As Singapore builds on its position as ASEAN Chair this year to deepen economic ties within the region and to boost regional business opportunities, I hope that ASEAN will grow in prominence as a target market for our companies.

STRENGTHENING OUR PARTNERSHIP FOR FUTURE GROWTH

10.         To navigate the path forward, we will also need to nurture stronger partnerships to enable future growth. Industry transformation requires the involvement of all stakeholders and partners, and not just support from the Government.

11.         One important platform for this collaboration has been through our Industry Transformation Maps (ITMs), which bring all stakeholders in an entire ecosystem, including partners, trade associations, government agencies and companies, to come together and implement a dedicated roadmap for the industry.  The ITMs also include initiatives to strengthen partnerships among the different stakeholders to develop transformative solutions. I am pleased to note that as of today, we have launched all 23 ITMs across different industry sectors. While they may have been launched, it takes effort for all of us now to come together to bring it to fruition. While the restructuring of our economy is a long-term effort and it will take time before we can fully evaluate how successful our efforts are, we have made some good progress thus far. 

12.         One example is in the wholesale trade sector, which is a broad sector covering a perse range of companies. In this sector, we have seen traction in the digitalisation of trade connectivity and B2B digital marketplaces with the launch of the ‘hive’ as part of the Wholesale Trade ITM. The ‘hive’ is a trade facilitation platform launched by the Singapore Logistics Association (SLA), ASEAN Federation of Forwarders Associations (AFFA) and Global e-Trade Services (GeTS) in October 2017 to simplify cross-border trade compliance requirements for over 50 customs authorities worldwide. Over 2,300 companies have been brought on-board the platform, with close to 3,000 transactions completed within 3 months. We hope that the momentum will gather pace and more transactions will take place as well.

13.         Another example on the innovation front is the progress we have made in encouraging retailers to implement innovative concepts, especially given the transformations in the retail sector such as the rise of e-commerce. This is a sector which faces a lot of challenges from online stores, and it is important that transformation also helps unlock opportunities. In December 2017, JCube launched Singapore’s first in-mall self-service lifestyle concept zone, #PlayatJCube The Corner, with support from the Singapore Productivity Centre (SGPC) and SPRING Singapore. The zone includes the first Retail Vending Cluster for fashion apparels by Decks. The merchandise mix for the pilot includes a variety of apparels, footwear and accessories and using next-gen automated retail systems. The Cluster comprises 19 vending machines where consumers can purchase hot food, apparel and knick-knacks, and even sing karaoke using these machines.

14.         The development of the ITMs is an iterative process which will need to be continually refined, together with our partners. We will take a cluster-based approach - to reap synergies, strengthen linkages and deepen capabilities across multiple industries. This way, the ITMs can continue to strengthen Singapore’s competitiveness in this next phase of our transformation journey.

15.         Finally, I would like to stress the importance of our businesses in taking a proactive approach towards transformation because a map is useless if companies do not take the first step to do so. Businesses must be willing to adapt to the changing circumstances, upgrade, and adopt a growth mindset. All of you here tonight are excellent examples of inpiduals who have made the necessary changes to bring your companies to where it is today. At the end of the day, what we hope to achieve are stronger businesses that are ready to compete on the global stage, which offer good jobs and career prospects for all Singaporeans. This calls for all of us to work together, deepen our partnerships and push resolutely ahead in our transformation efforts.

CONCLUSION

16.         In conclusion, I would like to thank DP Information Group for its contributions, over more than three decades, in carrying out these rankings and organising these awards.  This award ceremony has become a staple in the annual business calendar, providing invaluable insights into the state of Singapore’s corporate sector and the performance of different industries. I would also like to acknowledge the role and contributions of Ernst & Young as the co-producer of the awards.

17.         Finally, I warmly congratulate all the award winners, and the men and women who have led their companies to success. I hope that together, we will continue to strive for excellence, share with and learn from one another, to build a stronger future together.  I wish you every success in your ventures. 

18.         Thank you.