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Developing Singapore into a Trusted Global Hub in the Net Economy

Mr Yeo Cheow Tong, Minister for Communications & Information Technology Address - Infocomm 21 Leadership Dialogue, Suntec Singapore

Mr Yeo Cheow Tong, Minister for Communications & Information Technology
Address - Infocomm 21 Leadership Dialogue, Suntec Singapore
Singapore, 1 August 2000

1. First, let me welcome all of you, to this Infocomm 21 Leadership Dialogue. This is part of the series of dialogues and meetings organised by IDA, to announce and explain the key elements of the Infocomm 21 Strategic Plan. This morning, I will be announcing the Government's initiatives to dot-com the private sector. These initiatives will build upon the foundation laid by the other elements of the Infocomm21 that were announced over the past six months or so.

2. As you all are aware, the Internet Revolution has created a new business environment, one in which traditional business rules are being challenged, and even repudiated. E-commerce, or EC, has made a major impact to many business sectors, ranging from retail, stock trading and banking to logistics and the construction industry. It has created new market opportunities for start-ups, and offers existing businesses new ways to reach out to customers and to deliver services more effectively, often at lower costs. It has also allowed businesses to transcend geographical boundaries and enter new global markets. For example, Enron has successfully transformed itself from a traditional natural gas company, to one which brokers e-trading of electricity, coal, gas and other energy commodities, worth more than US$100 billion a year. Clearly, this new environment poses new business challenges, and companies must now quickly figure out how to identify e-commerce opportunities and effectively compete in the new economy.

3. As a country, we must also effectively address the challenges of the New Economy. Our vision is to position Singapore as a trusted global hub in the Internet economy, one in which e-commerce plays a dominant role in business and consumer transactions. To achieve this, we will need to create an environment in which e-lifestyle is pervasive, and where the hard and soft e-commerce infrastructure is well developed.

4. Currently Singapore is already one of the most e-commerce-ready countries in the world. The World Competitiveness Yearbook 2000 ranked Singapore as the top in Asia, fourth in the world, for e-commerce Infrastructure. The Economist Intelligence Unit 2000 also ranked us as No. 1 in Asia, and eighth internationally, for e-Business Readiness. However, with the phenomenal growth rate of e-commerce in various parts of the world, we cannot afford to stand still. We need to leverage on our strengths in e-commerce infrastructure, to quickly achieve a critical mass in e-commerce usage and transactions. To do so, we have, through strong partnerships with industry players, developed six key strategies to meet our vision. These are:

a. Laying a Robust Foundation of E-Business;

b. Catalysing the Digital Transformation;

c. Spurring Consumer Demand;

d. Branding Singapore as a Trusted Global "Dot.Com" Hub and An E-Business Thought Leadership Centre;

e. Attracting Top Talents; and finally

f. Fostering an E-Lifestyle and Bridging the Digital Divide.

5. The last two elements have already been covered in my earlier announcements on manpower strategies and programmes to dot-com the people sector. For today, I shall focus on the first four strategies.

6. First, to lay a robust foundation for e-business. Here, the telecoms infrastructure is a critical element. It must be of a high quality, be cost-competitive, and have excellent global connectivity. To achieve this, we fully opened up the telecoms sector on 1 April this year. Since then, all of you would have seen and enjoyed the benefits of competition. In the first two months following the liberalisation, IDD rates fell by up to 59%, or an average of 20% across the board. There is also phenomenal growth in our global connectivity. Based on the new submarine cable systems that will be landing in Singapore, we would have capacity of more than 15 terabits per second over the next 18 to 36 months.

7. The next major policy and regulatory challenge is to bring our rules and regulations up to the cyberspace age. Like all countries, most of our laws were drafted years ago, long before the internet became a household word. We will review existing laws and regulations, and bring them up-to-date to meet the needs of the New Economy. Our policies and laws must be clear and transparent, as uncertainties will only inhibit business innovation and growth.

8. Some work has, in fact, already been completed. For example, in the case of internet content hosting, the Government will distinguish content owners from those who merely host contents on behalf of others. Content hosters will be treated as conduit providers and exempted from legal liability for the content that belong to their customers. This will promote the growth of data hubbing centres. IDA will release more details soon. To promote the growth of e-auction sites, the Government has also reviewed and amended the Auctioneers' Act.

9. The 2nd strategy is "Catalysing the Digital Transformation". This is to move businesses from the old to the new, knowledge-based economy. Acting as a catalyst, IDA will, together with other economic agencies, pursue a mix of broad-based and sector-specific e-commerce adoption programmes. Under the broad-based programme category, IDA will work jointly with the Productivity and Standards Board, or PSB, to meet its goals under the SME21 plan. We will also leverage on the existing incentives and equity investment schemes offered by the various economic agencies, such as IDA, EDB, NSTB and TDB. The aim is to build up the e-commerce capabilities of our small and medium size enterprises. This will enhance their competitiveness and help them grow in a sustained manner.

10. For the sector-specific e-commerce programmes, we will focus on the development of e-communities in key economic sectors. The three targeted vertical sectors are trading and exchanges, manufacturing and logistics, and financial and banking. These have the most growth potential in terms of EC penetration and adoption. IDA, in partnership with market movers and the respective economic agencies, such as MAS, is actively formulating and implementing strategies to build marketplaces and assist business enablers in these sectors. We aim to have Singapore become a key e-trading, e-manufacturing, e-logistics and e-finance hub. As an example, IDA and TDB are supporting the efforts of the Singapore Commodity Exchange to develop an electronic marketplace for rubber and other commodities within the next 6 months.

11. In addition, we have identified e-learning as a fourth, horizontal sector that cuts across every economic sector. In partnership with the Ministry of Manpower and the Ministry of Education, IDA will focus on, and strengthen, e-learning. In particular, IDA will work with industry to build a comprehensive e-learning infrastructure. It will set up the E-Learning Standard Technical Committee, to help drive e-learning. This committee will comprise members from the learning, publishing, and infocomm industries, as well as user agencies. There will also be industry partnerships and projects to promote innovation and the development of new capabilities within the e-learning industry.

12. Third, under the strategy of Spurring Consumer Demand, we will address the issue of building consumer trust and confidence. This is essential to B2C e-commerce. IDA will conduct education and awareness programmes among consumers, and work closely with the Singapore Tourism Board, or STB, and PSB on education programmes for businesses to promote trust marks, trust labels and third party certification processes.

13. The fourth strategy is the Branding of Singapore as a Trusted Global "Dot.Com" Hub, and an E-Business Thought Leadership Centre. In a way, the branding challenge has been made less daunting by the fact that the Singapore brand-name is already fairly well-established. We have a reputation for integrity, and for honouring an undertaking. In fact, just a few days ago, I met a senior director of a British e-business, who told me that while they do a lot of product and software development work in India, they marketed the products and services out of Singapore. He explained that it gave their regional clients, including those in India, greater confidence.

14. To be a trusted hub, we will need to have a critical mass of e-businesses operating and hubbing out of Singapore. In line with this objective, IDA, together with other government agencies, will continue with investment promotion efforts to attract world-class e-commerce players to hub here. We will also facilitate their strategic alliance with Singapore companies, if they feel that this make it easier for them to penetrate the regional markets. Local companies must also look beyond out borders in this fast moving e-commerce sector. IDA will work with the industry to encourage and assist promising local enterprises to expand into the regional and international markets. IDA will also explore the setting up of business centres in strategic countries to help jumpstart e-business ventures in the region. These centres can serve as one-stop points-of-presence, offering business intelligence, and facilitating business matchmaking.

15. The Government is also working activity with industry partners and the universities to promote Singapore as a thought leader for e-business. The programmes in the pipeline include the development of e-commerce case studies and best practices, and the establishment of relevant EC indicators to aid market analysis and comparison.

16. Let me conclude by stressing that the success of the initiatives to dot-com the private sector will depend on the close partnership between the private, public and people sectors. The private sector is responsible for the EC infrastructure, and must drive the B2B and B2C activities. The public sector will put in place the supporting policy and regulatory framework for e-commerce, and lead by example through the numerous Government-to-Business, and Government-to-Consumer, online applications and services. The public and private sectors must then work together on awareness and education programmes, to encourage the people sector to become more infocomm-savvy. This will then enable and spur the people sector to actively participate in online transactions to create a vibrant e-marketplace.

17. With that, let me end by wishing all of you an interesting and fruitful and Dialogue.