Speech by SMS Sim Ann at the ISAS Pathfinder Joint Symposium

KEYNOTE ADDRESS BY MS SIM ANN, SENIOR MINISTER OF STATE, MINISTRY OF TRADE AND INDUSTRY; AND MINISTRY OF CULTURE, COMMUNITY AND YOUTH, SINGAPORE, AT THE JOINT ISAS-PATHFINDER FOUNDATION SYMPOSIUM ON MONDAY, 29 JANUARY 2018, 0920HRS, ORCHARD HOTEL

Ambassador Gopinath Pillai, Ambassador-at-Large and Chairman, Institute of South Asian Studies (ISAS),

Mr Bernard Goonetilleke, Chairman, Pathfinder Foundation, Sri Lanka,

Professor Subrata Mitra, Director, ISAS,

Distinguished Guests,

Ladies and Gentlemen,

Introduction

1.    Good morning. It gives me great pleasure to join you at the Joint ISAS-Pathfinder Foundation Symposium today, and I am glad to see many representatives from the business and academic communities present.

2.    The key theme for today’s symposium is “The Belt and Road Initiative – Politics, Potentials and Partnerships”.  This topic of discussion is particularly apt as we are entering a new phase of economic globalisation where increased integration and connectivity has resulted in greater opportunities for cooperation between countries. I would like to share how Singapore has been participating in the Belt and Road Initiative and how Singapore can play a role in facilitating business opportunities along the Belt and Road, especially in Southeast Asia.

Singapore’s Participation in the Belt and Road Initiative

3.    The Belt and Road Initiative (BRI) is a grand vision that represents China’s efforts to promote regional integration and engage more fully with the global economy. Singapore welcomes the BRI. The BRI enables mutually beneficial collaboration on economic integration and infrastructure development with countries in the region, including Southeast Asia. The BRI is unique in its character and scale, and Singapore has worked closely with China on this initiative in various ways.

4.    First, we embarked on the China-Singapore (Chongqing) Demonstration Initiative on Strategic Connectivity (CCI) in November 2015, our third Government-to-Government project with China. The CCI serves as a key priority demonstration project for the BRI and focuses on the theme of “modern connectivity and modern services”. 

5.    Good connectivity is key to the economic development of any region. Apart from the traditional forms of physical connectivity, the CCI aims to demonstrate how other dimensions of modern connectivity can catalyse the economic development of both Western China and Southeast Asia by focusing on four sectors – financial services, aviation, transport & logistics and information & communications technology (ICT). 

6.    Chongqing, which is CCI’s operating base, is strategically located at an intersection point along the BRI and the Yangtze River Economic Belt. It serves as an important node for trade between China, Central Asia and Europe along the overland Silk Road Economic Belt. By linking Chongqing and Singapore through the CCI, we hope to enhance greater integration and economic connectivity in the region.

CCI-Southern Transport Corridor (CCI-STC)

7.    Specifically, Singapore and China have been developing the CCI-Southern Transport Corridor (CCI-STC) which connects the overland Silk Road Economic Belt with the 21st Century Maritime Silk Road. Described by China President Xi Jinping as an international land and sea trade corridor (国际陆海贸易新通道), this route will not only facilitate greater integration of Europe and Asia via Western China, it will also enhance trade flows between Western China and Southeast Asia as it provides a shorter and more direct trade route compared to the traditional Yangtze River trade route. When fully developed, we envision that the CCI-STC would lower the overall logistics costs in both Western China and Southeast Asia.

ASEAN and South Asia are Regions of Opportunities

8.    Second, as a centre for global trade, transportation, legal and financial services, Singapore can be a regional node for the growing number of companies seeking to venture into key markets along the 21st Century Maritime Silk Road, including Southeast Asia and South Asia. 

9.     With its fast-paced urbanisation and large and growing middle class, South Asia is a bright spot of opportunity. The World Bank estimates that South Asia’s urban population will grow by almost 250 million by 2030. This entails enormous infrastructure requirements – new and upgraded – that must be built, and funded in order to sustain economic growth, and continue to raise standards of living in the region.

10. Similarly, ASEAN is a fast-growing region experiencing rapid urbanisation and is becoming increasingly integrated with a population of more than 600 million. By 2020, the region is expected to have a US$3 trillion economy. However, there is a big infrastructure gap that needs to be filled.

Singapore as a Leading Infrastructure and Financing Hub in Asia

11.  There are many areas where companies can collaborate to tap on opportunities along the Belt and Road, arising from South Asia and ASEAN’s growth and infrastructure needs. One key area is in infrastructure development and financing.

12.  As a leading infrastructure development and financing hub in Asia, Singapore can play a role in several ways: 

• First, Singapore is able to provide the necessary depth and breadth in banking and capital market services. Besides being the third largest foreign exchange market in the world, Singapore has also become one of the world’s top offshore Renminbi (RMB) clearing centres since the appointment of ICBC as the RMB clearing office in Singapore in May 2013. Singapore’s Monetary Authority of Singapore (MAS) has also been working with commercial banks to develop infrastructure as an asset class. This will help to harness more private capital to support companies’ infrastructure financing needs.

• Second, Singapore’s project financing strengths are also complemented by a network of multilateral development banks and a vibrant ecosystem of professional services in infrastructure advisories, political risk insurance companies and law firms with strong knowledge and extensive networks in ASEAN. Singapore can also be a neutral and independent dispute resolution forum for parties involved in Belt and Road projects. I believe that the Singapore International Arbitration Centre (SIAC) will share this in detail later this afternoon.

Partnering Singapore Companies to Tap on Opportunities

13. Looking across South Asia, it is evident that home-grown infrastructure companies are increasingly proving their ability to cater to the region’s immense and niche infrastructural needs in both urban and rural environments. The infrastructural development needs in a rapidly growing Southeast Asia region thus represents an opportunity for South Asia companies to become truly globally-competitive. When approached with a win-win mind-set, there is certainly scope for more mutually-beneficial partnerships to be forged between South Asia and Singapore companies to expand into third country markets such as those in Southeast Asia. Through the expertise honed delivering projects in distinct environments, companies from both regions could become formidable partners when tackling the large and complex nature of infrastructure projects in Southeast Asia.

Conclusion

14.  Symposiums such as this, organised by ISAS and Pathfinder Foundation, are good avenues and platforms for the sharing and understanding of opportunities available. As a next step, for collaborations to be successful, it is important for companies to come together and understand each other’s strengths and form new partnerships. 

15.  I am confident that today’s Symposium will prove fruitful and yield insights, with the exchange of good ideas and experiences. Thank you.