We must continue to promote a competitive domestic market. Competition begins at home. Our firms cannot compete globally if they cannot compete locally. Local competition will spur them to be more efficient, creative and innovative. Besides, competition will benefit consumers by moderating prices, improving service, and increasing product choice.

We will continue to deregulate our economy. We have opened up the telecommunications sector with a big bang. We are progressively liberalising the financial sector. We are gearing up for a full opening of the electricity and gas markets this year. We will refine these policies in the light of experience.

We have made significant progress in the setting up of a new energy market regime since its announcement by the Government in March last year. Amongst other measures, for the electricity industry, the system and market operation functions will be transferred from PowerGrid to the Energy Market Authority of Singapore (EMA).

The retail sector of the energy market will be liberalised in phases. Beginning later this year, the market for large consumers will be progressively made contestable. The retail market for the remaining one million consumers will only be opened up after 2002 as all households are affected and a detailed study will have to be done.

The gas industry will be restructured in a similar way to support a competitive framework for the electricity industry. The ownership of the gas transportation business, which is a natural monopoly, will be separated from the contestable sectors of gas import, trading and retail.