Speech by SMS Koh Poh Koon at the ASEAN Outlook Conference 2018

SPEECH BY SENIOR MINISTER OF STATE FOR MINISTRY OF TRADE & INDUSTRY DR KOH POH KOON AT THE ASEAN OUTLOOK CONFERENCE 2018ON WEDNESDAY, 17 JAN 2018, 2.50 P.M. AT SUPPLY CHAIN CITY

Dr Robert Yap, Chairman of the ASEAN Business Advisory Council Singapore

Distinguished Guests

Ladies and Gentlemen

Introduction 

1               Good afternoon, it is my pleasure to join you today for the ASEAN Market Outlook Conference to kick-start Singapore’s ASEAN Chairmanship in 2018 for the business community. It is timely that we are gathered here today as ASEAN strives towards realising the ASEAN Economic Community (AEC) 2025 for the benefit of businesses and people in the region.

The ASEAN Economic Community (AEC)

2               Since 2012, ASEAN has recorded a yearly growth between 4.5% and 6.1%^[1] and is expected to grow at a yearly average of 5.2% from now till 2020^[2]. By 2020, the region is projected to have a US$3 trillion economy and a population of more than 600 million with ASEAN, potentially becoming the fourth largest single market in the world by 2030, after the EU, US and China.

3               ASEAN has made significant headway in its economic integration efforts since its founding in 1967 to harness its growth potential.  An important economic milestone was reached in 2015 with the realisation of the ASEAN Economic Community (AEC) 2015. At the same time, ASEAN renewed its commitment to deeper economic integration by embarking on the AEC 2025. The AEC 2025 deepens integration efforts under the AEC 2015 and focuses on emerging issues relevant to the digital economy such as electronic commerce, technological change, the impact on global value chains and business models, as well as regulatory practices that are conducive to innovation. 

Deepening integration key to sustaining growth 

4               To sustain growth and its present trajectory against a backdrop of rising scepticism over globalization and unprecedented technological disruptions, ASEAN must continue to persevere in its commitment to advancing regional economic integration. Building a seamless, open and connected region will help unlock the potential of our economies, enhance the competitiveness of our businesses, create opportunities for our people and anchor ASEAN’s value proposition on the global stage. 

Tapping on the opportunities from the AEC 

5               To help businesses tap on the opportunities presented by the AEC and the digital economy, as well as to thrive against global competition, governments in ASEAN will need to help businesses, especially Small Medium Enterprises (SMEs), deepen their capabilities. Such efforts will also help businesses better leverage on the opportunities arising from the AEC.  

6               For example, in Singapore, small and medium-sized businesses are encouraged to adopt technology and innovation to strengthen their value proposition. Partnerships between SMEs, start-ups and multinational corporations (MNCs) to leverage on their complementary strengths are fostered. This facilitates the nimbler SMEs and start-ups to harness the resources, experience and commercial channels of the MNCs and large local enterprises to access higher value supply chains and global markets. Lifelong learning and skills upgrading is also an area of emphasis in Singapore. We aim to build a future-ready workforce equipped with the skillsets to tap on new opportunities from regional integration and globalisation to better adapt to the changing needs of industry

7               We also announced the merger of SPRING Singapore and IE Singapore to form Enterprise Singapore in September 2017.  The merger, which is expected to be completed in the second quarter of this year, aims to provide a one stop destination for Singapore SMEs to develop their capabilities and assist them in internationalisation efforts. Enterprise Singapore will help streamline the existing expertise, networks and resources of SPRING Singapore and IE Singapore to ensure Singapore SME’s stay competitive and have ease of access to regional and global markets.

8               Furthermore, to facilitate connectivity among freight forwarders, their business partners, and customs agencies, Global eTrade Services (GeTS) -  a subsidiary of CrimsonLogic - launched a freight forwarder community-centric platform named ‘hive’ in September 2017. Hive, which stands for highly interconnected and vibrant e-trade, is an initiative led by the ASEAN Federation of Forwarders Associations. Hive aims to increase the ease, accessibility and predictability of companies to do trade by allowing businesses to meet trade compliance requirements of countries within the region and beyond.

Singapore’s Economic Priorities in 2018 

9               As Singapore takes on the role of ASEAN Chair in 2018, we will focus on resilience and innovation.  Our aim is to position ASEAN as a region for seamless economic activity and growing opportunities, especially in the areas of the innovation and the digital economy. To this end, we will work with ASEAN Member States on a set of tangible and meaningful economic deliverables. 

10           First, initiatives on e-Commerce will be a key focus for our Chairmanship.  Singapore will work closely with ASEAN Member States to strengthen digital connectivity and promote e-Commerce flows within ASEAN to benefit businesses, especially the micro, small and medium-sized enterprises (MSMEs).  We will seek to streamline regional trading rules governing e-Commerce to support the movement of goods and services across the ASEAN region. In addition, we will work with ASEAN Member States to establish inter- and intra-ASEAN connections between ASEAN institutions, enterprises and entrepreneurs to strengthen the various innovation ecosystems of ASEAN. 

11           An example of a home-grown company that has benefitted from the opportunities in e-Commerrce is Anchanto, a home grown e-Commerce and logistics company. In 2016 alone, the company expanded into nine countries, including Indonesia, the Philippines and Thailand, with the support of IE Singapore. IE Singapore played a key role in offering deep market insights and connecting the company to local brands, distributors and e-marketplaces in the overseas market.

12           Second, Singapore will pursue trade facilitation initiatives in ASEAN to bolster internationalisation of MSMEs through the implementation of the ASEAN Single Window and the ASEAN-wide Self-Certification regime. This will ensure that our businesses continue to benefit from improved market access as the tariff levels fall within ASEAN.

13           I am pleased to announce that as of 1 Jan 2018, Indonesia, Malaysia, Singapore and Viet Nam have commenced ‘live’ exchange of the electronic version of the ASEAN Trade in Goods Agreement’s Certification of Origin Form D which demonstrates their products’ eligibility for preferential tariff treatment under the ASEAN Trade in Goods Agreement. Thailand has announced they will come on board shortly and the remaining ASEAN Member States have indicated that they are working towards joining the ASEAN Single Window by either this year or next. 

14           Singapore will also be working towards the full implementation of the ASEAN-wide Self-Certification regime. The regime allows certified exporters to self-declare the country of origin for their goods on permitted commercial documents, without having to apply for a conventional Certificate of Origin Form from their customs authorities. Businesses will stand to benefit from both these initiatives as expediting cargo clearance and cutting down on paperwork will increase the ease through which goods will flow within ASEAN.

15           Third, deepening services trade and reducing impediments to investment. Singapore will work towards the conclusion of the ASEAN Trade in Services Agreement (ATISA) and aim to improve the ASEAN Comprehensive Investment Agreement (ACIA).  The ATISA, a step up from the existing ASEAN Framework Agreement on Services, will broaden and deepen integration of services sectors. Efforts will also be made to reduce performance requirements for investors and their investments, and increase transparency under the ACIA. Both initiatives seek to create a more liberal, stable and predictable environment for service suppliers and investors within ASEAN as well as strengthen ASEAN’s value proposition as an attractive destination for investments and services trade.

16           Finally, Singapore will continue to strengthen ASEAN’s relations with its dialogue partners. Singapore plans to reaffirm and forge stronger ties with ASEAN’s partners through improving the existing ASEAN+1 FTAs, exploring deeper economic relationships with our Dialogue Partners and intensifying efforts to substantially conclude the Regional Comprehensive Economic Partnership negotiations. Our businesses have reaped benefits from ASEAN’s strong connections within and outside the region, and we must maintain this momentum.  

Conclusion

17           In closing, I would like to thank the Singapore Business Federation for organising the ASEAN Market Outlook Conference.  As the world around us continues to evolve, ASEAN must sustain its economic integration efforts, build on its successes to date, forge stronger ties with external partners, and deepen the capabilities of our industries and workforce.  

18           We will continue to work towards helping businesses in the region stay competitive, and we will need continued stakeholders’ engagement and participation in this process.  This platform is a good opportunity for all of us to exchange views on how ASEAN can navigate the fast-changing environment for long-term growth.

19           The role of business has been indispensable as ASEAN continues to deepen economic integration. I would like to thank the Singapore Business Federation for its leadership of the ASEAN-BAC, and the wider business community for their efforts and valuable insights to ensure that the AEC remains relevant to the needs of business. Inclusive and constructive consultations with the private sector will continue to be instrumental in ensuring that ASEAN’s integration efforts continue to benefit and create opportunities for businesses operating in the region.

20           On this note, I wish you a fruitful, productive conference and best wishes for the year ahead. Thank you.

[1]  Source: The ASEAN Secretariat “Global and Regional Economic Outlook”, 2017 and ASEAN Statistical Leaflet Selected Key indicators 2017

[2]  Source: OECD