Singapore Government Press Release
Media Relations Division, Ministry of Information, Communications and
the Arts,
MICA Building, 140 Hill Street, 2nd Storey, Singapore 179369
Tel: 6837-9666
OPENING
ADDRESS BY MR HENG CHEE HOW, MINISTER OF STATE FOR TRADE AND INDUSTRY, AT THE
LATINASIA BIZ FORUM 2005 AT THE MERITUS MANDARIN HOTEL ON WEDNESDAY 7 SEPTEMBER
2005, 9.05AM
Your Excellencies,
Ladies and
Gentlemen,
Introduction
Good morning. I warmly welcome you to LatinAsia
Biz Forum 2005. I thank the LatinAsia Biz Advisory Committee, led by our Ambassador to
Argentina and Chile, Mr. Philip Ng, for its support without which this Forum
would not be possible.
To our Latin American friends present
today, “Boa Vinda a Singapore,[1]” or “Bienvenido a Singapur[2]” –
welcome to Singapore. I urge you to
fully explore the vast business opportunities in Singapore and Asia, and build
partnerships here. We have much to learn and benefit from one another.
Growing links between Asia and Latin
America
Latin
America is fast becoming an engine of growth for the global economy. According to the World Bank, the Latin
American and Caribbean regions have the highest per capita income in the
developing world. In 2004, the region registered a growth of 5.7 per
cent, its highest in the last 25 years.
The
region is rich in minerals, oil and gas, and has a well developed agriculture
sector. Growing demand for raw materials
from emerging economic giants like China and India has benefited the Latin
American economies in recent years.
With
an urbanised, well-educated population, and an Internet penetration rate that
is amongst the highest in the developing world, Latin America is also well‑placed
to become a knowledge economy and to enjoy sustained growth in the coming
years.
Latin
America’s economic links with Asia have been growing rapidly. Latin America’s merchandise exports to Asia
increased by almost 20 percent to US$29 billion in 2003. Asia was Latin America’s third largest source
of merchandise imports, after North America and Western Europe. Today, an Asian country like China features
among the top five trading partners of Latin American countries such as Brazil,
Mexico, Chile, Argentina and Panama.
Total trade between Latin America and
Singapore also increased strongly by 32.3 percent between 2003 and 2004, to
S$7.8 billion, with Singapore’s exports to Latin America increasing 20.9
percent to S$5.2 billion. Trade‑flows
with our key trading partners in Latin America, including Brazil, Mexico and
Panama, has continued to grow robustly in the first half of this year.
Singapore’s Footprints in Latin America
Until
recent years, only a handful of Singapore companies were present in Latin
America, mainly with representative offices.
Jurong Shipyard was one of the pioneers that
led the “first wave” of Singapore companies into Latin America some thirteen
years ago. Jurong
Shipyard used to repair Brazilian ships in its Singapore docks. One of their clients was Petrobras,
Brazil’s national oil and gas company.
As business with Petrobras grew, Jurong Shipyard eventually started operations in Brazil to
service their client. Around the same
time, Keppel Fels clinched a project to build a
floating production unit for Petrobras as well. Today, these two companies continue to enjoy
success in Latin America, and their business there accounts for perhaps half of
their global business.
Besides
Jurong Shipyard and Keppel FELS, Natsteel
Trading, Singapore Food Industries, Ghim Lee, Ocean
Sky, Kaybee Group, and Neptune Orient Lines have also
become established players in the region.
The
“second wave” of Singapore companies arrived in Latin America in the last four
to five years. In 2001, Sunningdale Tech, one of Singapore’s leading precision
plastic manufacturing companies, set up a manufacturing facility in
Guadalajara, Mexico, so that they could be nearer to their US clients. Petra Foods, one of Asia’s largest cocoa
processors, bought over processing plants in Brazil and Mexico from Nestlé in
2003. RGM International formed Bahia Pulp by acquiring a stake in a Brazilian firm. Bahia Pulp now
processes close to 120,000 tons of soluble pulp a year. Olam and Noble
Group have also set up operations in the region.
With
the growing experience and success of Singapore companies in Latin America,
more companies have ventured into the region.
Singapore Technologies recently announced plans to supply cable TV
signal down‑converters to Mexico.
Banyan Tree also has plans to develop luxury resorts there. Earlier this year, Portek
International, a port equipment engineering company, announced its sale of two
quay cranes to Port of Ensenada in Mexico.
Beyond
Mexico and Brazil, our companies are also making headway in Panama. Later on at this Forum, we will be hearing
details about some recent successes in Panama by Inter‑Roller Engineering
and Portek International.
In
today’s competitive global economy, Singapore businesses must constantly seek
out niches and new markets to stay relevant.
Latin America is rich in resources and opportunities and we must deepen
our engagement there to capitalise on these opportunities.
Singapore is engaging Latin America
To
add this effort, and recognising the region’s growing economic importance to
Singapore, we have actively engaged various Latin American countries in
bilateral trade negotiations. A Free
Trade Agreement (FTA) not only reduces tariff barriers for goods but also
provides more protection for investments and greater access to each other’s
services sectors. Since last year’s
Forum, Singapore has concluded FTAs with Panama and
Chile. We have also initiated
negotiations with Mexico and Peru.
Companies from both sides should make full use of these FTAs to penetrate further into each other’s markets and
regions.
At
the tactical level, IE Singapore opened its first Latin American office in
Mexico City in 2000, and subsequently appointed an Honorary Business
Representative in Santiago, Chile. With
growing interest, IE Singapore will be opening another office in Sao Paulo,
Brazil, later this month.
Latin American
companies in Singapore
Today’s
event is about “Bridging Partnerships”, which means business opportunities
should flow both ways. I would likewise urge our Latin American friends to look
to Asia as a key market. The combined
GDP of East Asia, which includes Japan, Greater China, Korea and the 10
countries of Southeast Asia, was about US$8 trillion in 2004. The Southeast Asian region alone represents a
growing market of 500 million people, with a large appetite for goods and
services.
Singapore’s pro‑enterprise and open economy has made it home to
some 7,000 multi-national corporations today.
Several Latin American
companies are already using Singapore as their regional headquarters in Asia.
For example, CEMEX, one of the largest cement companies in the world, is using
its Asian headquarters in Singapore to coordinate its import terminals,
grinding mills, production plants and sales offices in Thailand, Philippines,
Indonesia, Cambodia, Taiwan and India. Embraer, one
of the largest aircraft manufacturers in the world, is also using its regional
office in Singapore to coordinate customer service, logistics and technical
support in the Southeast Asian region. We welcome other Latin American
companies to use Singapore as a springboard into the rest of Asia, taking
advantage of Singapore’s infrastructure, our connectivity, our modern and open
business climate, and our competitive business costs.
Conclusion
I hope this year’s Forum will add to
the momentum of collaboration and achieve even more win-win outcomes for all
participants. I wish you all a fruitful
Forum and a pleasant stay in Singapore.
Thank you.