Singapore Government Press Release

Media Division, Ministry of Information and The Arts

36th Storey, PSA Building, 460 Alexandra Road, Singapore 119963.

Tel: 3757794/5

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May I bid a very warm welcome to all participants and delegates to this conference and exhibition. Once again, you honour us with your presence and participation.

It is opportune that the international maritime community, representatives from port authorities, government and trade bodies, ship operators, ship owners, financiers, insurers, freight forwarders, bunker suppliers should gather here today in Singapore, for this Asia’s premier maritime event. Much has happened since the last time you met here.

With your unstinting support, the Port of Singapore has continued to grow robustly. You have made us very busy, the world’s busiest in fact. In 1997, 130,000 ships called, totalling 808 million gross tonnes. You contributed to the movement of 327 million tons of cargo, in terms of TEUs - 14.14 m TEUs and bunker sales of 16.94 million tons.

With all this growth, we are able today to celebrate the handling of the 100-millionth TEU container at PSA’s container terminals since containerisation came to Singapore in 1972. It is only fitting therefore, that we are able to celebrate this occasion together with you.

I thank the maritime community – both in Singapore and overseas – for the invaluable support given to the Port of Singapore. Because of your decision to make Singapore your hub port in this region, we have been able to handle our 100-millionth TEU. Because of your vote of confidence, we have been able to win the Asian Freight Industry Awards again this year. And by your choice Singapore has been voted the "Best Seaport" and PSA the "Best Container Terminal Operator" in Asia.

But, as we keep reminding ourselves, past achievements do not guarantee future success. This year and the years ahead will be tough years for all of us. The economic turmoil has cast a deep shadow across our region. Like the other sectors, the maritime industry will not be spared.

So will SingaPort ’98 and SIBCON ’98 be remembered for the gloom and doom? I sincerely hope not for that would be doing all of us a great disservice. There is such a phenomenon known as the self-fulfilling prophecy. Do not forget also that tough times do not last forever.

Although it is still too early to cheer, there are already some signs that confidence and stability is beginning to return to some countries in the region. According to at least one research agency – the Economic Intelligence Unit – East Asia’s Gross Domestic Product will grow by 4% per annum from 1998 to 2002. When this crisis blows over, the regional economies will have built sounder fundamentals, and emerged leaner but stronger. The prospects remain bright for the region. Those who desire to participate in this brighter future, and to reap the benefits, must remain engaged.

Singapore looks forward to finding areas of common interest and co-operation with them to enhance the competitiveness of all parties in the partnership. In the meanwhile, Singapore will do what it can to help you ride out the tough times.

MPA will continue to provide the 20 percent concession in port dues. MPA and PSA have jointly announced earlier that the overside bunker wharfage fees have been waived. Some additional measures were recently announced in Singapore’s 1998 Budget.

Firstly, we have removed the freight tax on local cargo. Foreign ship owners or charterers, whose ships call at Singapore, will no longer have to pay tax on the income earned from picking up local cargo. This measure should encourage foreign shipping lines to uplift more local cargo from Singapore.

Secondly, a new incentive was announced for the freight and logistics sectors. Approved operators will enjoy a tax concession of 10% or more on their additional income for up to five years. Ship agencies, international freight forwarders for air and sea, and logistics companies are welcomed to apply for this tax concession.

Thirdly, no tax will be levied for 10 years, on income from offshore marine hull and liability insurance. With this incentive, Singapore-registered insurers will be able to build up sufficient reserves, in order to take on overseas competition. We recognise that Singapore is well-placed to serve the marine insurance needs of regional companies, since Asian shipping companies own more than 40% of world shipping tonnage today.

In addition, the Approved International Shipping Enterprise scheme – known in short as the AIS scheme which currently applies only to ship operators is extended to ship charterers. We are attuned to the growing importance of chartering, and with this measure, we aim to make Singapore more attractive as a ship-operating base.

Besides giving tax breaks where appropriate, Singapore is selectively liberalising sectors where greater competition will benefit the maritime community. In doing so, we hope to raise the prospect for better services and more competitive rates. This is why the Maritime and Port Authority of Singapore has opened up the provision of towage services to new players. Public licences have now been granted to two more tug operators to serve vessels at shipyards, oil terminals and Jurong Port.

Neither is this the last stage of the liberalisation. In July 1999 or earlier, depending on market conditions, we expect to introduce competition in towage services into PSA’s container, conventional and cruise terminals. In doing so, I want to stress that the end objective is to lower costs and improve efficiency, so that the maritime industry benefits.

Beyond direct cost reduction, we will be looking at how service quality and work processes can be enhanced to bring about greater cost efficiency and service quality for port users.

For a start, Maritime and Port Authority will develop the Singapore Maritime Information Centre (or SMIC) Web Site which will house information on our full range of maritime services. The SMIC Web Site will complement PORTNET, our current EDI system which links up multiple parties for the fast and paperless processing of port services. We aim to integrate processes for service application and information provision, so that Port users will enjoy one-stop convenience, at low cost and high efficiency.

To enhance quality assurance for the bunkering industry in Singapore, the MPA will implement the Bunker Quality Inspection System (BQIS) to ensure that the quality of bunkers delivered to ships in Singapore conforms to the ISO marine fuel specifications, i.e., ISO 8217 Standard.

Last but not least, Singapore will continue to advocate navigational safety. This is a fundamentally important area, because the loss of navigational safety could over-ride whatever other advantages in cost or service.

The Maritime and Port Authority will continue to use IT to maintain a high safety standard for ships in Singapore port waters. Their Vessel Traffic Information System and Electronic Navigational Charts are examples of using IT to ensure precise traffic control and safe navigation.

Your continued support has helped make Singapore port what it is today. Our partnership has provided mutual benefits. I have no doubt that the symbiotic relationship we have developed through the years will continue to strengthen in the years ahead. I would like to encourage you, in the course of your deliberations and discussions in the next few days, to share with us your ideas on how we can improve to serve you better.

On this note, I now declare SingaPort ’98 and Sibcon ’98 open.