1. Good morning to everyone at the Supply Chain Asia Forum 2022. Thank you for the invitation to deliver the opening remarks.
The World in Flux
2. Singapore is now emerging from the depths of the COVID-19 pandemic, which has caused great disruptions globally. Supply chains, which were already impacted by COVID-19, are now facing many more challenges on the international front. The Russian-Ukraine war has undermined the post-WWII international rules-based order which provided global stability for us to thrive. The recent situation on both sides of the Taiwan Straits has aggravated concerns about how the US-China relationship will develop.
3. The world is in a state of flux. Singapore will have to navigate this and various key global transitions in the next 50 years on the geopolitical, economic, and carbon fronts. Let me elaborate.
4. First, the world faces a significant geopolitical transition. We should not assume a stable international security order in which countries abide by the rule of law. Nor should we assume the dominance of one single global power, especially as middle powers develop greater strategic significance. While we have largely operated in a global trade and economic order that had clear and predictable rules, where decisions were premised largely on economic logic, this may no longer be the case going forward. We must expect a more fluid geopolitical environment, where stability is not guaranteed. And geopolitical considerations may colour economic decisions more, and in more unpredictable ways.
5. Second, the world is facing an economic transition. We expect changes in the relative economic weights amongst both major and medium economic powers, such as the US, China, Indonesia and Vietnam. Trade linkages and networks will see significant shifts. Patterns of production, supply chains, and economic value chains will readjust and reconfigure.
6. There are various reasons why all these are happening. The US-China trade war resulted in tit-for-tat tariffs. Technological contestation between the two major powers has led to the onshoring of production, export controls on emerging technologies, and more. Learning from COVID-19, many countries and companies are enhancing resilience by diversifying production. More are adopting a "China +1" strategy or shortening supply chains. We are also seeing new models for production, business, and new technologies. For example, 3D printing and digital manufacturing can shorten and reconfigure global production layouts. And businesses are increasingly combining data and finance for better sight over their supply chains, new ways to manage capital, and to drive greater efficiencies. All these will be intensified by developments in technology such as big data, better computing power, and AI algorithms.
7. Third, we have to handle the carbon transition. As the world transits to a low-carbon energy scenario, energy-intensive industries, which are highly sensitive to carbon and energy prices, may transit to carbon-neutral technologies. Countries which can produce the minerals, materials, and technologies for renewables will be the "new winners". In terms of food production, rising temperatures, climate change, and demographic transitions can cause shifts in production, from current agricultural land to new areas and geographies. Thus, in addition to the geopolitical, economic, and concerns about resilience that I mentioned earlier, the carbon transition will also see significant changes in energy supply flows, food production flows, and the manufacturing map.
Seizing Opportunities
8. All these key transitions are a test for every country, and for all of us here, in our ability to adapt and navigate.
9. We know that Singapore must strengthen our resilience. But equally important is our ability to seize new opportunities amidst these transitions. To redefine Singapore's competitiveness; strengthen and entrench Singapore's position as a key node in global supply and value chains. And for us to entrench our reputation as a trusted, connected hub that we will always leverage on our key advantage of using knowledge and data. Let me touch on each of them.
10. First, we should value-add to relationships and continue being a trusted partner. We must maintain a conducive and predictable business environment, with stable institutional norms. Amidst shifting geopolitical tides, we respond based on principles and not by taking sides. We earn our living by remaining an open node, where businesses have assurance in a stable investment environment, and trust that their assets are secure here.
11. Second, we need to pioneer new forms of connectivity even while we reinforce existing ones. We will continue growing Singapore's hub port status and global logistics network. We are building our new Tuas mega port. And we will resume our plans for Terminal 5 at Changi Airport. Our sea and air connectivity with the rest of the world helps companies compete as a global network even while remaining anchored in Singapore. By diversifying our connections across the world for resources and markets, we can reduce disruption risks and keep business flows going. The denser our networks, the more resilient we are.
12. We should also seize new opportunities from the connectivity of data, finance, and technology. We can leverage technology and digitalisation to transcend physical boundaries and tap into global markets. And make better use of data, coupled with stronger financial linkages, to develop more resilient and efficient supply chains. By doing so, we can be more versatile, develop the capabilities and capacity to produce things that are valuable to the world, to exchange and secure what Singapore needs in return.
13. Third, we should ensure that Singapore remains a preferred platform for collaboration. We do so by distinguishing Singapore as a trusted node in a global network, with rich knowledge networks. We must embrace new technologies and new business model as they evolve, and learn the new necessary skills. For example, Robotic Process Automation, or RPA – a 10-hour task can now be completed in less than an hour. Being a pathfinder in building new talent networks will help us to thrive in a new, dynamic global economy. COVID-19 accelerated the adoption of remote work and enhanced virtual connectivity. This is a good opportunity for Singapore companies to build our global talent network without the constraints of size, geography, or population.
14. The demand for certain skills will be dynamic and short-lived. Workers will thus need to have strong foundational skills that they can build on, and continually learn new skills and pivot to new growth areas. And quickly close the cycle from frontier industry knowledge to the classroom.
15. All these uncertainties are also opportunities for Singapore to strengthen our position as a trusted, connected and competitive supply chain node for the world. Through the COVID-19 pandemic and geopolitical uncertainties, the role of Singapore as a critical supply chain node has been strengthened. We maintained our open posture, never nationalising other people's assets for our own benefits. We remained open and connected even as the rest of the world shut down their airports and ports. Instead, we became the critical option for others to overcome their supply chain disruptions and we became the "catch-up port" for others. All these bode well for our long-term reputation.
16. But we didn't just keep still. We continued to invest in data, platforms, financial connectivity, and regulatory connectivity to further strengthen our lead. As we continue to get all these things right, our supply chain potential will continue to grow.
Importance of Lifelong Education and Training
17. Beyond the investments in capabilities, we must also continue to invest in our people. A well-educated and well-skilled workforce that constantly seeks to upgrade and to "never leave school".
18. Our workers must have the right environment, resources, tools, and motivation. Our Institutes of Higher Learning (IHLs) need to ensure that their offerings are up-to-date, relevant to industry needs, and can cater to different profiles of adult learners. Since the launch of the SkillsFuture movement in 2015, our IHLs have significantly expanded their offerings. For example, the SkillsFuture Series is a curated list of courses focusing on priority and emerging skills areas. I am heartened that Supply Chain Asia has partnered the SMU Academy to design and develop industry training programmes for both foundational and professional learners. For example, the Advanced Diploma in Logistics and Supply Chain Management & Transformation. And the Professional Certificate in Supply Chain Innovation.
19. Industry and employers should also invest in workforce training and development today, for future business needs. Employers should support workers in developing in-demand skillsets, such as in technology and data analysis. Some of these skills may not be immediately relevant to employees' current jobscope. But by acquiring these additional skillsets, employees will have stronger foundations and can better keep pace with the company when the company transforms. I am happy to hear that Supply Chain Asia is targeting to train up to another 1,000 adult trainees by 2023.
20. Individuals must also take charge of their skills development journey, and embrace a learning-oriented mindset. Many working adults tend to apply a high discount rate towards training and upskilling. Understandably, they spend much time juggling various responsibilities. However, beyond conventional full qualifications, there are also shorter-form, modular courses supported by SkillsFuture Singapore or SSG. I encourage all to take up these options.
Closing
21. The transitions that the world is undergoing cannot be understated.
However, amidst the uncertainties and competition, we can stand out and stay ahead of the curve by remaining a trusted partner, building strong connections, and enriching our networks.
22. I wish all of you a very fruitful discussion at this year's Forum. Thank you.