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“Creating New Opportunities for Growth”
1. Commitments in Fixed Asset Investments (FAI) brought in by the Singapore Economic Development Board (EDB) in 2007 exceeded S$10 billion, for the first time ever, by a wide margin. It was also a record year for Total Business Spending (TBS) and number of jobs created. These strong investment achievements will open up new opportunities for growth and jobs. 2007 was notable for the depth and quality of investments in capital-, knowledge- and innovation-intensive activities that these investments will bring to Singapore in the coming years.
(I) YEAR 2007 IN REVIEW
2. The investment commitments for year 2007 are given below:
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2007 Investment Commitment Indicators
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3. EDB delivered good results in all five indicators in 2007, exceeding the forecast for the year in VA, FAI, TBS and job creation.
4. Close to 400 projects were committed in 2007. When fully implemented, they are expected to create 28,600 new jobs and add S$11.6 billion per year to Singapore’s Gross Domestic Product (GDP). Of the 28,600 jobs created, many will be in the fields of engineering, management, research, as well as creative and industrial design.
5. These projects not only help in developing depth in our key industry clusters, but are also notable in that many will provide the spark for new clusters to grow, such as in Clean Technology. They reflect strong investor confidence in Singapore. It also affirms manufacturing as a critical component of Singapore’s economic growth, and underlines our ability to continue to attract high-end complex manufacturing projects, which brings in quality jobs for people living in Singapore.
6. Even as EDB brings in projects with increasing demands on the skills of our workforce, we continue to invest in developing local talent to ensure that the craft and skill-sets of our workers fully meet industry requirements. To that end, we have rolled out three manpower initiatives in 2007:
- Wafer Fabrication Specialist Manpower Programme, which will fund the training of some 900 specialised engineers for the semiconductor industry in our tertiary institutes.
- Precision Engineering Manpower Initiative, which will fund the training of some 2,000 people at the Polytechnic and ITE level, enhancing their expertise and skill-sets in Precision Engineering. This in turns allows them access to a wide variety of jobs within Singapore’s manufacturing sector.
- Finally, the Clean Energy Scholarship which aims to churn out the future industry leaders of the Clean Energy sector by sponsoring 130 Masters and PhDs locally or overseas.
(II) CLUSTER DEVELOPMENT
7. Capital-, knowledge- and innovation-intensive activities are key to the continued and sustained development of Singapore’s economy. More importantly, such types of projects provide good jobs for people in Singapore. Many of the projects that EDB pursues have a combination of such characteristics.
8. Investors make capital-intensive investments only when they are convinced of the long-term viability of their projects and the stability of the host country. As the industry cluster develops in depth and range, we are better able to secure a strong pipeline of capital-intensive investments for the future. Some capital-intensive projects announced in the year include (see Annex B for project descriptions):
- ExxonMobil’s (US) second world-scale petrochemical project in Singapore.
- Neste Oil’s (Finland) world’s largest next-generation biodiesel manufacturing plant.
- Novartis’s (Switzerland) large-scale biotechnology plant.
9. EDB has also actively pursued knowledge-intensive activities which require highly-skilled workers. These in turn boosts our workforce capability, and bring in jobs which are interesting, challenging and higher-paying for people in Singapore. Knowledge-intensive projects announced in 2007 which require very high level of engineering skills from the Singapore workforce include (see Annex B for project descriptions):
- Rolls-Royce (UK) setting up a plant to manufacture aircraft engines. This will be the first plant ever in Asia to assemble and test engines for large commercial planes like the Boeing 787 and Airbus 350XWB. This ‘Factory of the Future’, will develop and incorporate the latest in engine assembly techniques.
- Heptagon’s (Finland/Switzerland) project bringing in revolutionary technology for the manufacture of micro-optics. The technology enables higher resolution image capture for cameras in mobile devices, and at the same time makes the device more compact and affordable.
- TNT’s (Netherlands) largest life sciences-focused regional distribution centre using the latest in cold chain management technology to safely transport and store goods ranging from medical devices, clinical diagnostics to pharmaceuticals and biotechnology.
- Sony (Japan) setting up a highly automated plant incorporating its most advanced technologies for the production of lithium ion polymer batteries which are used in mobile phones.
- FormFactor (US) manufacturing its wafer probe cards in Singapore, each containing tens of thousands of MicroSprings® which are smaller than the width of a human hair, and carrying out complex testing of semiconductor wafers.
- Philips Lumileds (Netherlands) setting up a compound wafer fabrication facility to manufacture high power Light Emitting Diodes (LEDs), which are used in products like LCD displays and camera flashes for mobile phones. This is the first such facility in Singapore.
10. Innovation-intensive activities are also important to enhance Singapore’s capabilities and further Singapore’s competitive advantages by bringing in niche technologies. This in turn raises the level of industrial R&D in Singapore. Singapore’s offering to the rest of the world is a highly skilled workforce and a strong R&D infrastructure. Some noteworthy projects announced in 2007 include (see Annex B for project descriptions):
- PayPal (US) setting up its international headquarters and technology development centre to develop payments platform for the global market.
- Infineon Technologies (Germany) announcing the expansion of its R&D team to 550, with more than 200 involved in chip design.
- EMC (US) announcing its South Asia Development Laboratory, which will enhance Singapore’s capabilities in network storage solutions.
- Bosch (Germany) opening its IT regional operations centre in Singapore and is providing IT services for over 200 locations in Asia Pacific. It is also establishing its Asia Pacific R&D headquarters here to carry out research in new areas.
- Keppel Offshore Marine (KOM) (Singapore) launching its Technology Centre to strengthen its R&D efforts in the areas of Rig and Vessel Design, FPSO topsides, subsea processing systems and shipyard process improvements, among others.
(III) NEW AREAS OF GROWTH
11. EDB has also made good headway in developing new industries. Some projects in the new growth areas include (see Annex B for project descriptions):
- In Clean Energy, Renewable Energy Corporation (Norway) building the world’s largest integrated solar manufacturing complex, valued at S$6.3 billion. Also, Oerlikon (Switzerland) recently announced that Singapore would host its only site in Asia which will manufacture and undertake R&D in solar manufacturing equipment. Solar Energy Power (Germany), Singapore’s first solar cell manufacturing plant, started production of ultra-thin wafer-based solar cells in May 2007.
- In Environment and Water, R&D centres being established by Keppel (Singapore), Danish Hydraulics Institute (DHI) (Denmark) and Marmon (USA)-Hyflux (Singapore). Also, the Singapore Membrane Technology Centre was set up as part of Nanyang Environment & Water Research Institute at Nanyang Technological University. Black & Veatch (USA), a leading environmental engineering firm, also established its global water design centre cum Asia-Pacific headquarters.
- In Natural Resources, Mitsui & Co (Japan) establishing its Asia Pacific HQ in Singapore, and NUS (Singapore) setting up the Minerals, Metals and Materials Technology Centre to undertake research and development. Also, GenoMar South East Asia Pte Ltd achieved an important breakthrough in successfully developing the world's first DNA traceability system for fish.
12. Looking forward, EDB will explore opportunities in the following business growth areas where Singapore itself requires good solutions, where Singapore can serve as a working model and a test bed for new ideas. The three areas are:
- Urban Solutions – Cities need to deal with pollution control, traffic management, clean water, clean energy, and various environmental problems resulting from urbanisation. An example of business opportunities that have sprung up from these areas is the Clean Energy Research and Testbedding initiative, which saw clean technology being tried out in new building constructions in Singapore, incorporating clean energy features.
- Health, Wellness & Ageing – There is a growing interest worldwide in wellness and health, especially for the ageing population, which will drive efforts in translational medicine, and a wide variety of products and services. Solutions for ageing populations will also look at reducing healthcare costs and improving personal productivity.
- Lifestyle Products & Services – These are business opportunities built upon the interest and purchasing power of the broad middle class in Singapore and the large numbers of rising middle class, especially in Asia. For example, Singapore is fast gaining a reputation as a regional commercial and solutions hub for sports, entertainment, branding, IP rights management and marketing, R&D, training and education.
13. EDB has also been reaching out for new sources of investment from Asia and the Middle East. Last year, there were several significant projects from China, India and the Middle East. For example, Tsinghua Tongfang (China) began operations for its Asia-Pacific R&D Centre for IT and Environment which will require 100 researchers when fully established. Wipro Technologies’ (India) is setting up an R&D centre while Tamilnadu Petroproducts and Kuwait Finance House are major joint venture partners to build a petrochemical plant.
(IV) 2008 INVESTMENT OUTLOOK
INVESTMENT COMMITMENTS FORECAST
14. The investment outlook for Singapore for 2008 remains positive even while there are expectations for a worldwide economic slowdown. EDB’s investment forecast for 2008 is as follows:
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UPDATED KEY PERFORMANCE INDICATORS
15. EDB has been using FAI to measure the level of Manufacturing investments and TBS as the indicator for Services investments. However, this is no longer adequate. For example, many manufacturing projects are going asset light through extensive outsourcing. To more accurately reflect the nature of economic activities that we are pursuing today and in the foreseeable future, EDB intends to measure FAI and TBS of the combined manufacturing and services sectors in its KPIs from 2008. EDB will also use Number of Skilled Jobs as its indicator for employment creation, because these are the kinds of jobs which are the focus of EDB’s efforts.
16. EDB’s forecasts based on the updated performance indicators are as follows:
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(V) CONCLUSION
17. “EDB has achieved many noteworthy projects in 2007. It has been a remarkable year, and a testimony to the EDB officers who have worked passionately and innovatively to arrive at this point. We would like to salute all our partner agencies with whom we have been working closely to satisfy the different requirements of the various projects. Together, we make Singapore a highly attractive global business and investment hub. But while we work hard to bring in new investments into Singapore, it is equally important that we deliver on what are promised to these investors. We deliver, we deepen their trust, we earn their respect, we attract more to come,” said Mr Lim Siong Guan, Chairman of EDB.
For media enquiries, please contact:
Alex Tan
Tel: (65) 6832-6284
Mobile: (65) 9841-0392
Email: alex_tan@edb.gov.sg
Ms Eileen Ng
Communications
Tel: (65) 6832-6660
Mobile: (65) 9369-8598
Email: yeeling@edb.gov.sg
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