His Excellency Alberto Cardenas

Governor of the State of Jalisco

Distinguished Guests

Ladies and Gentlemen

It gives me great pleasure to officiate at the launching ceremony of three Singapore-owned companies in Mexico: Natsteel Electronics, Hi-P Singapore and Sei Woo Rubber Works. It was only ten months ago that His Excellency President Ernesto Zedillo visited Singapore. This is my first official visit to Mexico and I must say that the Singapore delegation has been touched by the warm reception given to us since our arrival.

Singapore has traditionally focused on the Asia Pacific region, primarily for reasons of proximity and familiarity. However, with the globalisation of businesses and quantum improvements in air communication, technology and telecommunications, the world has now become our marketplace. We are actively encouraging our companies to explore the new and emerging markets around the world. Latin America and the Asia Pacific are the two fastest growing regions in the world, with growth averaging more than 10% a year.

Our bilateral relationship is healthy. Despite the geographical distance and differences in language, bilateral ties are growing. Our countries enjoy a beneficial economic relationship.

Let me illustrate. Our bilateral trade in the last decade has increased by an average of 34% per annum. Last year, bilateral trade rose by 106% to S$980 million (or US$700 million). In 1996, Mexico was Singapore’s third largest trading partner in Latin America. But in the first half of 1997, Mexico has become Singapore’s top trading partner in Latin America.

Mexico has recovered from the 1994 peso crisis. It has successfully overcome the twin problems of capital flight and galloping inflation. Its privatisation programme, liberal trading regime and free-market policies have contributed to a congenial environment for foreign investors. Singapore companies investing in Mexico are extending Singapore's external economic wing. They are looking beyond Singapore's immediate region to emerging markets elsewhere. Being strategically well-positioned in relation to both the US and the Latin America market, Mexico could act as a gateway for Singapore in this part of the world.

Similarly, Mexico could utilise Singapore’s position as a gateway to the Asia-Pacific. Singapore’s historical, economic and political links with the Asian growth areas can add value to Mexican businesses. Singapore has good business and financial infrastructure, and the market knowledge and contacts. Mexican companies which are unfamiliar with Asia could minimise their risks by establishing operations in Singapore, or partnering Singapore companies in joint ventures in the Asia Pacific.

I congratulate Natsteel Electronics, Hi-P Singapore and Sei Woo Rubber Works on their investments in Mexico. They have in total, invested US$19 million in Mexico. Currently, they employ about 1,000 Mexicans. Today’s launching ceremony signal Singapore's growing interest in Mexico. These investments will not only generate economic benefits for both Singapore and Mexico, but will also enhance bilateral ties.

NatSteel Electronics has in a few years grown to be one of the largest electronics contract manufacturers with a turnover of US$700 million in 1996. It has invested US$11 million in a Guadalajara manufacturing plant, employing 800 staff. It aims to have a world class operations in Mexico. It has a manpower training plan in which selected Mexican employees will be sent to Singapore for skills training. Singapore trainers will also train Mexican nationals in Mexico. Guadalajara is a good manufacturing base for Natsteel to access the NAFTA market as it offers strong government support, a pro-business environment and good transportation and infrastructure facilities.

Similarly, these factors have attracted HI-P Singapore, a tool and die company, to establish a US$6 million manufacturing plant with an expected staff strength of 200 by the end of this year. The plant is sited on 7,300 square metres of land at the Guadalajara Industrial Park. Meanwhile, Sei Woo Rubber Works is building a US$2 million plant to produce customised precision rubber components for the electronics industry in Chihuahua. It will be operational by the end of this year. It has also set up a sales office in Guadalajara.

Ladies and gentlemen,

I believe that this launching ceremony marks the beginning of more Singapore projects in Mexico. As His Excellency President Zedillo mentioned when he was in Singapore last year, "We may be late in getting acquainted, but we are getting closer each year." I am confident that the linkages between Singapore and Mexico will expand. Singapore looks forward to working closely with you to achieve success in our mutual undertakings.