21 September 2010 - Speech By Mr Teo Chee Hean, Deputy Prime Minister and Minister for Defence, at the SingTel i.luminate 2010 Business Innovation Forum "Powering the Future of Business at the Speed of Light"Speech By Mr Teo Chee Hean, Deputy Prime Minister and Minister for Defence, at the SingTel i.luminate 2010 Business Innovation Forum "Powering the Future of Business at the Speed of Light", 21 September 2010, 9:00am at Suntec Singapore
Ms Chua Sock Koong, Group CEO of SingTel
Ladies and Gentlemen,
1. A very good morning to all. Thank you for inviting me here today for SingTel's i.luminate 2010 Business Innovation Forum. It is an opportune time for us here today to consider the power that infocomm can give businesses. This is especially so, with Asia's rapid recovery from the global financial crisis putting the region in good stead to support strong and stable economic growth. According to forecasts by the World Trade Organisation, Global Insight and Goldman Sachs, by the year 2020, Asia will account for an estimated 60 per cent of global trade flows and it will replace North America and Europe as the centre of global trade. The IMF also predicts that Asia will become the largest economic region in the world by 2030.
2. Asia's economic growth is driven by the rising middle-class and the rapid urbanisation of China, India and Southeast Asia. These countries have weathered the recent financial crisis well. Here in Singapore, we are also expecting to see record growth this year. Multi-national corporations, seeking to ride on Asia's growth to fuel their continued market leadership, recognise the increasing sophistication of Asian consumers. They see the need to customize their products and services for Asia and hence are investing to expand their businesses in Asia. As a global city in the heart of Asia, Singapore is well-positioned to host these new growth activities.
3. There is also no better time for us to discuss the power of infocomm for businesses. Just this month, we have seen the introduction of retail infocomm services that are transported, literally, at the speed of light on Singapore's fibre-to-the-home Next Generation Nationwide Broadband Network. Five years ago, the fastest broadband plan available to consumers in Singapore was 30 megabits per second. Today, broadband is more than 30 times faster, with speeds of up to 1 gigabits per second on offer. How many of you owned a smartphone just 5 years ago? Today, up to 80% of all new handsets sold in Singapore are smartphones1. Looking ahead, between 2009 and 2014, global Internet Protocol (IP) traffic is expected to quadruple2. In the same 5 years, business IP traffic is forecast to more than double3.
4. These statistics show that what we could only imagine in the past has become reality today; and the encouraging numbers help us to dream of possibilities for the future. At the national level, the government's vision for 2015 is to transform Singapore into An Intelligent Nation, A Global City, Powered by Infocomm. We look forward to seeing businesses contribute to this vision by powering the future of their businesses with infocomm.
5. There are 3 things that I would like us to think about today - possibilities, people and partnerships. The possibilities to leverage on infocomm today are beyond what we could have imagined just a few years ago; how can it be used to increase national productivity and create opportunities? As infocomm brings about business model transformation, do we have the right people? In a world where innovation drives value, what partnerships are necessary to breed innovation?
Possibilities for Productivity and Growth
6. It is a fact that infocomm is a key driver of economic growth, much of which comes through productivity improvements4. This is of special interest to Singapore, as productivity has been identified by the Economic Strategies Committee as one of the enablers for sustained and inclusive growth for Singapore in this new world environment.
7. Allow me to share an example. In the trade and logistics sector, a typical export shipment consumes the time and resources of 25 different parties, preparing up to 40 trade documents using multiple systems, in order for the shipment to take place. The TradeXchange programme we have implemented in Singapore enhances productivity by integrating key B2B processes through a common platform. As a result, enterprises enjoy operational efficiencies and faster B2B processing. Ten freight forwarders and insurance companies are presently integrating their insurance application processes through TradeXchange and expect turnaround time for approvals to be reduced from four hours to less than one hour. In the process, this will achieve an annual efficiency savings of more than one million dollars. By the end of 2012, 100 companies are expected to participate in the TradeXchange programme, integrating B2B transactions for Singapore's export shipments. This is but one example of the possibilities that are available to businesses to leverage on infocomm for productivity gains.
8. Even businesses traditionally not known for leveraging on IT are beginning to do so to great effect. For example, the Association of Employment Agencies in Singapore (AEAS) implemented a Software-as-a-Service (SaaS) portal, designed to improve productivity and service quality of employment agencies in Singapore. Besides streamlining operations, the portal also serves as an online platform for these agencies to promote their business services overseas. Having started a pilot with 10 employment agencies, the Association is now gearing up to encourage their cluster to get onto the platform with the support of relevant government agencies. Additionally, the Infocomm Development Authority of Singapore (IDA) has also seen more than 5,000 small and medium enterprises tap on the SME Infocomm Package scheme since May 2008 to create a web presence and unlock new business opportunities.
People make IT happen
9. The promise of infocomm can only be fully realised with the right people in place. Infocomm can enable productivity gains through collaborative and innovative solutions that take advantage of the new "lighter-weight" services-based and social media technologies. For this to happen, the infocomm knowledge of the workforce has to be high. As infocomm companies help clients improve their businesses, infocomm professionals need to combine deep infocomm knowledge with sound domain knowledge of the sectors they serve. For instance, the healthcare sector requires infocomm professionals who can improve hospital efficiencies, deepen collaboration across medical specialisations and aid timely decision-making by allowing caregivers quicker access and deeper insights into patients' medical records. To this end, IDA's manpower development strategy aims to develop infocomm competencies in key economic sectors, as well as to nurture globally competitive infocomm professionals in Singapore.
Partnerships for Innovation
10. The third critical aspect is partnerships. Singapore is today known globally for our ability to execute complex projects. Our expertise is sought by our partners in a variety of areas, from healthcare and finance to logistics. Looking ahead, new opportunities for innovation are emerging at the intersection of these sectors. For example, infocomm plays a key role in interconnecting efficient power grids, greener buildings, more convenient transportation systems and better water management systems in smart cities. This is but one illustration of the increasing complexity and the interdisciplinary nature of infocomm innovation for the future. This in turn necessitates wide ranging partnerships forged across industry, academia and the public sector in pursuit of common goals.
11. The Singapore government sees itself as a partner to industry for infocomm innovation. Our focus is to create an ecosystem conducive for businesses to innovate with infocomm. One element of this ecosystem is the infrastructure - fast, affordable and readily available connectivity. The Next Generation Nationwide Broadband Network will allow all homes, schools and businesses in Singapore to have access to ultra-high speed broadband by mid-2012. The Singapore Internet Exchange is another government initiative, in partnership with industry, that will enhance Singapore's infocomm connectivity. Besides directly benefiting citizens, projects like these have helped to anchor multinational corporations such as Amazon Web Services, Salesforce.com and Equinix here, enhancing Singapore's position as an info-communications hub.
12. We also have policies and incentives that help Singapore move beyond being a data processing hub to becoming a leader in innovation. Within the last year alone, we have attracted some 26 foreign innovative infocomm start-ups from countries such as the U.S, Israel, Sweden and China. They have established their engineering centres here, bringing in more than S$50m of investments and 260 high-value, innovation-driven engineering jobs.
13. This conducive environment has made Singapore a 'living lab' for innovative solutions for businesses. Citibank, StanChart and OCBC have launched numerous services using Singapore as the pilot market before rolling them out across Asia. Cisco, IBM and Oracle have, in partnership with IDA, set up Next Generation innovation centres to tap our infrastructure and capabilities in order to develop new products and services in strategic and emerging technology areas.
14. We are looking at an exciting future of great change. To fully benefit from the opportunities which this future brings, I encourage organisations to step forward to explore new avenues for collaboration and innovation with one another. SingTel is one of those that have done that. The SingTel Innov8 Fund will provide start-ups with seed funding and incubation services, leading eventually to commercializing the products through SingTel's channels. The Fund will add significantly to the capital pool for entrepreneurs and start-ups in Singapore, help catalyze new products and services, and mark another milestone in SingTel's growth journey.
15. In conclusion, I urge all of you to take advantage of the opportunities to collaborate and leverage on technology, to make today's infocomm possibilities a future reality for your businesses, and for Singapore. I wish all of you a most fruitful gathering during your time together this week.
Notes to Editor:
1 Source: Straits Times, 14 April 2010
2 Source: Cisco Visual Networking Index: Forecast and Methodology, 2009-2014
3 Based on a CAGR of 21%, forecasted in the Cisco report
4 Source: OECD, "ICT and Economic Growth - Evidence from OECD Countries, Industries and Firms", 2003