1 The current Asian economic crisis marks a trend-break from the past. When it is finally over, the world will look very different. While most parts of Asia will recover and resume their rapid growth, some parts may remain mired in difficulty for a much longer time. There is nothing inevitable in human history. There is no guarantee that all the countries affected by this current crisis will automatically recover and do well again. For us in Singapore, our approach to the future should not be based on unthinking optimism but on a very realistic appraisal of the forces at play. In our minds, we should prepare ourselves for worst case scenarios, including dark and messy ones.

2 However, whatever the scenarios we consider, some of our responses are constant and invariable. Let me highlight two of them. First, we must take National Service seriously and maintain the SAF at a high level of operational effectiveness. This requires a strong commitment by Singaporeans and an advanced scientific and technology base here.

3 Another invariable is having to live by our wits in a world that will become more complicated. Economically, we must expect other countries to want to cut us off whenever they can. We can only make a living by offering a superior service so that, in the entire region, the seller sells dearest in Singapore and the buyer buys cheapest here. This means that our infrastructure must be tip-top. Our port, airport, telecommunication facilities and financial institutions must be world class. We must exploit the latest in science and technology to maintain our position as an entrepot, not only for goods and services, but also for human knowledge and human talent. We must always be thinking of new ways to add value and serve others.

4 In all scenarios, we need to be strong in science and technology. Science and technology will continue to transform our lives. No sector is unaffected by the revolution in information technology. In the next century, the revolution in biotechnology will also transform the nature of human society, for better and for worse. The wealth of nations and the wealth of cities will no longer depend primarily on land, raw materials and muscle power. Instead, the key success factor will be human knowledge residing in individuals and systems. In Singapore, we must prepare ourselves across all fronts for this knowledge-based economy. We have to educate our people to the limits of their potential. We must also attract all kinds of human talent into Singapore. Our attitude to human talent must be a welcoming one. If we are narrow-minded and protectionist, we cannot hope to compete in the first league, or even in the second league.

5 One important aspect of a knowledge-based economy is technological entrepreneurship, which is a new and different kind of entrepreneurship. Singaporeans are used to trading and investing in traditional goods and services. In the last century, it was spices and opium. In the earlier part of this century, it was rubber and tin. Today, it is ship containers, tourists, financial instruments and real estate. In the next century, we need to have entrepreneurs in knowledge-based industries, especially in high-tech. Our technological entrepreneurs will need a different knowledge base and different instincts. We have to learn from the experiences of Silicon Valley, Israel and Taiwan in mastering these new skills. We have to build up a comprehensive infrastructure for technological entrepreneurship.

6 This evening, I would like to announce two initiatives, both of which are to prepare ourselves for the knowledge-based economy of the next century.

7 First, I am pleased to announce the launch of the Institute of High Performance Computing (IHPC). IHPC is formed from the merger of the National Super-Computing Research Centre and the NUS Centre for Computational Mechanics.

8 The potential impact of high performance computing to both the manufacturing and the services sectors of our economy is vast and growing. In the manufacturing, electronics and chemicals industries, high performance computing will enable companies to achieve better product quality, shorter time-to-market, reduced failure rates, and lower cost of design and production. For the financial services industries, the advantage of high performance computing can be very significant. High performance computing can analyse complex data relationship and identify hidden trends. The potential enhancement to a company's competitiveness can be enormous. Let me give a few examples of the projects undertaken by IHPC.

9 One of the first projects on virtual product design and engineering was carried out with Motorola Electronics. High performance computing technology was used to design quickly and cheaply robust pagers which can take very rough handling. IHPC is also working with ST Simulation Systems to develop the virtual reality market in the region. IHPC has a 3-D visualising facility called MIRAGE - Modelling Immersion in Real-time Advance Graphic Environment. It is being used to help the architects, engineers and interior designers of Far East Organisation to visualise, in a very realistic way, the spaces that they are going to build. Not only is such modelling useful to architects and interior designers, it also enables M&E engineers to study air-flow patterns and create more comfortable environments for homes and offices. The first project is the conversion of Fullerton Building into a luxury 5-star hotel.

10 Another project that IHPC is working on is with a Japanese company called Sunstar Logistics. This company is a manufacturer of chains and sprocket assemblies for Honda and BMW. The latest European Commission ruling on permissible noise levels of motorcycles prompted the Japanese company to collaborate with IHPC on ways to reduce noise emission from its chain and sprocket assemblies. This entails basic research in metal-metal contact acoustics. With high performance computing technology, the mathematics are manageable.

11 By becoming a single agency, the Institute of High Performance Computing will be better able to assist Singapore industries in the use of high performance computing technology for solving all kinds of problems. This can be an important competitive advantage for them.

12 The second initiative that I would like to announce this evening is the Technology Incubator Programme. This Programme will help us develop a more conducive environment for high technology start-ups. In the last few years, NSTB, together with other agencies, have gradually built up a support system for such start-ups. This support system makes it easier for individuals and companies to convert technological innovations into commercially viable business ventures.

13 The Technology Incubator Programme will further enhance this support system. Currently, scientists or engineers with good ideas often lack the ability or inclination to exploit such ideas for business. Also, they may not have the network or management experience. The Programme will help to marry the technological expertise of innovators to the business expertise of investors and entrepreneurs.

14 Under the Technology Incubator Programme, start-ups will be nurtured and mentored by experienced businessmen or entrepreneurs. These Incubator Managers will assist the start-ups in market feasibility studies, business planning, market development and recruitment of venture capital. Under the Programme, secretarial and administrative support such as book-keeping and procurement functions will also be provided. The Incubator Management Company can be a stakeholder to the start-ups themselves. This is a very important incentive.

15 The Technology Incubator Programme is targeted at technology start-ups with strong commercialisation potential. The Programme will also provide these start-ups with early financing, covering up to 85% of R&D costs and other business expenditures, for a period of two years. By then, the start-ups should be able to raise further financing from the venture capital market themselves. In return for up to 85% funding, the start-ups will allocate up to 30% stake to NSTB, out of which a percentage may be given to the Incubator Management Company. We hope, in this way, to attract private sector involvement in nurturing such start-ups.

16 We are starting with a pilot programme to support a total of 15 technology start-ups. A budget of $10.8 million has been allocated for this pilot programme which will be for three years. After that, we will do a review and see how the programme can be widened and enlarged.

17 The theme for this year's Tech Month is "The Future Works". This is not to say that we know what the future holds for us. Indeed, the future will always surprise us and upset our best-laid plans. What we have to do is to prepare ourselves for uncertainties. For, even in chaos and madness, there is logic and method. We know that whatever scenario eventuates in the coming years, Singapore must move into a knowledge-based economy and develop new skills in technological entrepreneurship.

18 It gives me great pleasure to launch Tech Month '98 and wish everyone a good year ahead. There is no need for me to wish you exciting times.