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Singapore Anchors its Status as Global Logistics Hub by Harnessing Information Technology

Dr Lee Boon Yang, Minister for Information, Communications and the Arts (MITA) Opening Address at the Infocomm Media Business Exchange Opening Ceremony

Dr Lee Boon Yang, Minister for Information, Communications and the Arts (MITA)
Opening Address at the Infocomm Media Business Exchange Opening Ceremony
Singapore Expo on 15 June 2004

Good morning
Distinguished guests
Ladies and gentlemen

1. I would first like to extend a warm welcome to all participants, exhibitors and delegates to the Infocomm Media Business Exchange or imbX. In particular, for those who have come from overseas, I do hope that you enjoy your stay in Singapore. I am glad to see such a good turnout from both the infocomm and media industries especially after the unforeseen cancellation of last year's CommunicAsia and BroadcastAsia. I see the strong interest in participating in imbX as reflecting the strengthening business sentiment and growing confidence in both the infocomm and broadcasting industries. I must also congratulate the organisers, Singapore Exhibition Services and the Singapore infocomm Technology Federation for bringing together four major events - CommunicAsia, BroadcastAsia, EnterpriseIT and the iX Conference - to give industry players more extensive opportunities to network in an increasingly integrated infocomm and media environment.

2. While the heady days of the dotcom boom are not likely to return in the near future, the infocomm industry is certainly enjoying sustainable growth. This sense of optimism is evident not only in the Singapore ICT industry, but also globally. In Singapore, according to latest preliminary figures from the Infocomm Development Authority's (IDA) Annual Survey on the Infocomm Industry for 2003, the infocomm industry saw a revenue growth of 1.7 percent last year, to reach S$32.7 billion. Companies surveyed gave a forecast of positive revenue growth in the region of 6-7 percent in 2004 and 7-9 percent in 2005. With the positive growth expected, demand for infocomm jobs is expected to increase by 3-4 percent for the next 2 years. This is good news for job seekers and graduating students.

3. Beyond Singapore, the International Data Corp (IDC), projected IT spending in the Asia-Pacific region, excluding Japan to grow 10 percent to US$88 billion this year. This represents a sharp increase from the 3.4 percent growth seen in 2003 reflecting the continuing recovery in regional economies.

4. The media industry is also abuzz with new developments and business opportunities. For instance, in broadcasting, global trends indicate a continuing push for digital broadcasting. Last week, Singaporeans were treated to a preview of the use of digital radio in the home. This was a milestone for digital audio broadcasting in Singapore. At the preview, a range of digital audio broadcasting equipment for household use was demonstrated. This preview was the result of collaboration between Robert Bosch, a leading distributor of digital audio broadcasting equipment, MediaCorp Radio and the Media Development Authority (MDA). We hope that this will mark the beginning of a strong partnership geared to introducing digital radio to Singaporean listeners.

5. In May this year, Singapore launched the world's first full digital multiplex. This involved local cinema operator, Eng Wah Organization, completing the world's first 2K digital cinema deployment in a five screen multiplex theatre. It is hence most appropriate that digital cinema is a key theme of BroadcastAsia2004. I understand that the Singapore Pavilion this year has 10 Singapore-based companies showcasing the latest applications in digital cinema, digital TV and digital audio broadcasting. Another highlight of BroadcastAsia 2004 is the Digital Cinema Day with the Asian D-Cinema summit. At this summit, industry experts from Singapores Eng Wah Organization, GDC Technology, Mukta Adlabs and SingTel will share their views and vision for digital cinema in Asia.

IT Still Does Matter

6. When I spoke at the opening of iX 2003 last September, I made reference to Nicholas Carr's Harvard Business Review article "IT doesn't matter". I am happy that Mr Carr is here to speak at iX 2004. To recap, Mr Carr argued that with pervasive use, IT is becoming increasingly commoditised. As a result, a company seeking to use IT as a strategic tool will not be able to sustain a competitive edge against its competitors. Other commentators, including Mr Philip Lay who also spoke yesterday, are of the view that businesses seeking to benefit from their IT investments must combine IT with business innovations to gain that competitive edge. This useful insight about business innovation is one which we in Singapore must take to heart or risk being left behind while others surge forward.

7. In Singapore, we continue to harness ICT in government and business to enhance competitiveness and achieve better business outreach. Our efforts have been noted in the recent Accenture's annual survey on e-Government. Singapore was once again rated as the leading e-Government in Asia and second only to Canada globally. I note that iX Conference puts the spotlight on e-government this year. This is a timely move to share experience and compare notes on e-government services.

Strategic Harnessing of ICT for Continued Competitiveness in Logistics

8. One area where ICT has made significant difference for Singapore is in logistics and supply chain management. Last year Singapore's ports handled a record 18.4 million TEUs (Twenty-foot Equivalent Units) of containerised cargo. Without comprehensive deployment of ICT systems and applications, such an achievement would not have been possible. Indeed ICT is the new work-horse of many logistics players for managing extensive globalised supply chains for their customers. Efficient ports and on-the-ball logistics and supply chain management are often cited as key reasons for MNCs to continue to site their manufacturing and distribution hubs in Singapore.

9. Hence, logistics remains an important contributor to our economy bringing in about 8% of our GDP. It is also a critical enabler, anchoring other high-value economic activities such as manufacturing and distribution hubs in Singapore. It is therefore crucial that we continue to hone our competitiveness as a global logistics hub and supply chain nerve centre. To do so, I see ICT deployment as the most critical element in the effort.

10. Hence IDA is working with the high-tech manufacturing community in Singapore in the adoption of open e-business standards and enabling technologies like web services and collaborative product design. IDA also plans to leverage on Radio Frequency Identification or RFID technology to help local companies tap into global supply chains. These are complementary efforts to transform the logistics industry and bring it to next level of competitiveness through harnessing ICT.

Beyond TradeNet

11. Such recent efforts are a continuation of our earlier efforts to use ICT as a productivity tool in the logistics sector. These earlier efforts included the implementation of the TradeNet system in 1989. TradeNet enabled the trading community to submit trade declarations electronically to the relevant authorities without calling personally at the offices to apply for permits. It was able to cut down document processing from 2 days to 10 minutes. Since then, other IT systems have been introduced to meet business needs. These include PortNet and Jurong Port Online for sea logistics, Cargo Community Network for air logistics and Marinet for dangerous goods.

12. Each of these systems has effectively met the needs of its user communities over the years. However, with technological advances and new business needs, there is potential to join up these islands of computerisation into a more powerful, pervasive network to better serve the entire trade and logistics community in Singapore. Indeed, industry players in the logistics and ICT industries have called on the Government to integrate these stand-alone systems to reduce inefficiencies and better integrate processes and information flow.

13. I am pleased to announce that after careful study, the Singapore Government will invest up to S$50 million over 5 years in the development of an integrated IT platform to better serve the trade and logistics community. I note that the ICT and Logistics Working Groups under the Economic Review Committee's Sub-Committee on Services had both called for such a platform to be set up. More efficient information flows among shippers, freight forwarders, carriers and financial institutions will facilitate the flow of goods within, through and out of Singapore. The S$50 million will include project development expenditure, assistance for industry adoption and other project costs. When adoption attains critical mass, this integrated platform will power a quantum leap for companies by shortening the time to market, and creating new business opportunities in areas like "track and trace" logistics services.

14. The project will consist of a core IT system that will automate the creation and exchange of commercial and regulatory documentation necessary to facilitate trade. In addition, we envisage that a pool of value-added services will be developed around the core platform, for example, track and trace services and trade finance processing.

How Does Industry Stand to Benefit?

15. Providing a single web interface to all trade-related IT systems will help logistics players cut down on multiple data entry steps. This will avoid duplication of manual efforts and reduction in human errors and ultimately improve efficiency and time to market. The net effect is increased competitiveness for the logistics industry.

16. In a study conducted by The Logistics Institute-Asia Pacific, it was estimated that an integrated logistics information platform can potentially bring about long-term cost savings in excess of S$700 million, and create additional value add of nearly S$4 billion over a 20-year period, through new logistics value added services such as reverse logistics, regional distribution and multi-country consolidation hubs.

17. The core information platform will also spin off many new opportunities for ICT solutions vendors to build new and innovative applications for the logistic sector. We are happy to invite all technology providers to take part in the forthcoming tender exercise and to propose innovative solutions that leverage on the core platform.

Formation of User Council

18. In developing this project, we have received strong support from our industry partners. I would like to take this opportunity to thank the user companies and industry players who had earlier participated in the various focus group discussions and industry workshops during the study phase of this project. Their inputs have been tremendously helpful in fleshing out the details of the project and reinforcing our committment to proceed with the project.

19. A User Council led by the Economic Development Board, will be set up to engage the industry throughout the project. This continuous dialogue will ensure that this integrated IT platform will be fully customised to industry needs, relevant to industry.


20. ICT is a critical transformational force in Singapore. The development of this platform will generate immense downstream opportunities for the ICT industry. For the logistics community, the development of an integrated trade and logistics IT platform will bring about efficient and secure movement of goods in and out of Singapore. In many ways, this project fits in with the key themes of the imbX community - intelligent use of IT, business innovation, importance of regional and global connections, and most of all, bringing people and companies together to share and realise good ideas.

21. On this note, I wish all our participants a most fruitful exchange of ideas and insights, and our overseas visitors a pleasant stay in Singapore. Do also take some time off to enjoy our city. The annual Singapore Arts Festival and the Great Singapore Sale are taking place now, so there should be plenty to see and do. I am pleased to now declare Infocomm Media Business Exchange 2004 open.

22. Thank you.