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Keynote Address by Mr Heng Swee Keat, Minister for Finance, at The 20th Annual SME Conference, 21st Infocomm Commerce Confrence & SME Expo 2018 (SMEICC 2018) on 15 August 2018, at Suntec Convention Centre, Hall 404

15 Aug 2018




2   中华总商会做得很好,有一个三合一的会议,应该拿一个有关提高生产率的模范奖。 中华总商会从1906年创会至今,一直致力于促进本地工商业的发展;也不忘回馈社会。今时今日,中华总商会依然延续同样的使命,不断带领会员与时并进,为新加坡经济做出贡献。

3   例如:总商会刚在几个月前推出了一项数码化计划,让各个商团可以通过一个共同的数码平台来提高行政效率,同时也为属下会员提供更多方便。

4   在此,我要特别表扬中华总商会在推动数码化方面所做的努力。

5   刚才,黄山忠先生提到企业转型。企业转型是至关重要的。政府也非常支持本地企业转型,也在大力推动中小企业走向数码化和国际化。在这方面,总商会和商团可以扮演关键角色,成为政府的重要合作伙伴。

6   我希望通过今天的交流及分享,大家都能够有所收获和启发!

7   接下来,我将用英语发言。

The Spirit of Entrepreneurship

8   In Singapore’s business community, we have a strong tradition of entrepreneurship and hard work. This spirit among our pioneer entrepreneurs has been an important driving force in our economy over the decades – in fact, even before Singapore’s independence, before we had organisations like EDB and ESG.

9   There are many examples of entrepreneurship, and I think all of you here are good examples of that entrepreneurial spirit, and your willingness to come together to learn, to see what we can do even better is a very good expression of that spirit of entrepreneurship.

10  I would like to share two stories of successful entrepreneurs whom I have learned a lot from. One is Mr Eng Liat Kiang. He set up Sin Heng Chan Group. He is close to 100 years old and still goes in to work every day.

11  He started life with a provision shop, which was disrupted by the Japanese invasion. Then he later on took risk to venture into new business areas after the war. He moved into real estate and ventured overseas, even though he had limited experience and even though it was a period of great uncertainty.

12  He has said the values that a great entrepreneur must have that will never change, and let me quote: Strong willpower, determination and the ability to endure difficulties will see you through many challenging moments.

13  I have great respect for Mr Eng and I think he is not only successful in his own business but he has also done a lot for the community. I think many of you here know him and also respect him.

14  Now the other example I want to give is Mr Ng Kar Cheong, Founder of Pan-United Corporation. He grew up selling “youtiao” on the streets. Then he went into hardware firms and the construction sector, despite not having the necessary education or the previous experience. He devoted his time to learning on the job. Before we had SkillsFuture he was already learning on his own, on the job, and he sought out foreign firms that were setting up in the Jurong area when we were developing Jurong Island.

15  I visited them recently, and mentioned the company in the Budget this year. Based on the foundation he built, his children and his team have been investing to stay relevant.

16  I visited their R&D center and was really surprised and very delighted to see the R&D work that was going on in the cement factory. When I went to the control room to see how the cement was mixed and sent to the construction site, I thought I was going into a police operation centre, with the way that the trucks were directed. And when I visited the R&D lab, I was very happy to hear that the cement that they were able to make meets the US new standard for runways. This is a really good story, and they can now break into regional and global markets.

17  In all these examples, they attributed their success to diligence and perseverance, and what I observe is a tremendous spirit of entrepreneurship. That entrepreneurship is not about having a good idea, but being able to have the appetite to try new things, to find new ways of doing things, and being able to inspire the team of people who are working with us to be able to break new grounds, because change of any kind is very difficult.

18  Every morning we wake up when we brush our teeth, we will brush it in a certain way and when we comb our hair we will comb it in a certain way. When we go to work, we go by the same route every day. We are creatures of habit; it is not easy to change. And when you are running a business, in particular a business that is very successful, we will think “I have been so successful all this while, why is there a need to change?” But the outside world is changing very quickly, and I am very happy to see that in this year’s conference, it is really about change, where the theme of your conference is 颠覆者. 挑战者. 领跑者.

19  So we need that spirit of embracing change, the spirt of being alert to opportunities in our changing environment, and being able to smell out the good opportunities. And importantly, having the perseverance, willpower and the hard work, as I cited both examples of Mr Eng and Mr Ng.

20  So this is the spirit that we need to go forth and we have been very fortunate that over the years, businesses have been successful. Now the important question for us is: “What are the big changes that are happening around us?”

21  I am sure that in each of your businesses, you have many changes that are coming and I would like to share three that I mentioned in the Budget, and I will be happy to listen to more of your views of what are the changes you are seeing.

The Shift to Asia

22  First big change is the change in the center of economic gravity back to Asia.For hundreds of years, the biggest economies in the world were in Asia – China, India. Because if you look at the population growth, it was all in this part of the world because there were important innovations particularly in agriculture that produced enough food for people, and therefore Asia was able to support a growing population.

23  But the interesting thing is that when I was a student, the first thing that I learnt in my course when I was in England was the British Industrial Revolution. Why did Industrial Revolution, 工业革命, happen in Britain and not in Asia, and the Industrial Revolution was a really big change in history. Because of the 工业革命the use of steam power and later on electricity, the economies in Europe and later on in America really boomed. It is how they were able to take advantage of this opportunity.

24  So when you think about in the earlier era what the Spanish and the Portuguese were able to do when they mastered the art of navigation, mastered the art of knowing where the ship was in the wide world and they had the sense of adventure to go out, they were very successful. Of course, the next stage was the Industrial Revolution.

25  So the important question is what is next? What is the next big change that is coming? I would say one big change is the shifting of economic weight back to Asia.

Emergence of New Technologies

26  The second big change is the emergence of new technologies. Why new technologies? The industrial Revolution is an example of new technology where from steam power to electricity, it really changed the world.

27  Recently, I met Mr Klaus Schwab from the World Economic Forum, and he gave me the second book that he writing on the Fourth Industrial Revolution, the 第四次工业革命. In the Fourth Industrial Revolution, information communications technology is a very big driver. It is not just information technology. More importantly, it is how information technology is affecting every other business; and how other technologies are coming together with information communications technology and how the technologies are reinforcing one and another and giving great advantage to those who can master it. That is why all the major countries are talking about the Fourth Industrial Revolution.

28  I was in Japan recently to learn a little bit more about ageing population and what they do with an ageing population. Interestingly, I had a very good meeting with their Council of Science, Technology and Innovation. The big thing in Japan is that instead of Industry 4.0, they talk about Society 5.0. I asked, “What is Society 5.0?” They said, “It is not just how technology can improve the economy. It is also how technology can improve technology.” So I said “Give me some examples.” They said, “For instance, how can we use technology better to support an elderly population?”

29  So I was very, very delighted to hear that, because they were not just thinking of technology for business but they were tackling the most difficult one. We would just say the older people are not so technology savvy and therefore they will be left behind. Instead they were thinking of how do I use technology to enable our people to live better lives and continue to be productive. One example that I saw was the exoskeleton – something that you wear along your belt so that a 70-year old can lift the same weight as a 17-year old. So how technology can be used to enhance human capability. I think that is the way that we should be working towards – how we can deploy new technologies in ways which are more interesting.

Partnership and Collaboration

30  I spoke about the spirit of entrepreneurship, the spirit of looking for new opportunities and new ways. There is another thing that I want to speak about which is about partnership. I will talk a little about the Golden Triangle in a minute but let me share with a few examples of this spirt of partnership.

31  The first example I want to give which I learnt many years ago is in Wenzhou. I went with at that time Minister Raymond Lim to Wenzhou to study, because we heard so much about Wenzhou. Wenzhou has a nickname in China. The Wenzhou people, 他们是中国的犹太人. 为什么他们是犹太人?因为他们的企业精神很好。做什么都成功。So when we went there, we visited a showcase of all the cigarette lighters that were produced in Wenzhou. At that time, they had about 70, 80% of the world’s production of cigarette lighters.

32  So I went there, in one big exhibition area, you could see every single cigarette lighter that was produced in Wenzhou. I was very surprised. At that time, I was in the Trade Development Board as well as in Ministry of Trade and Industry, and I asked, “Your Trade Development 好厉害. Can get everyone to do this?” Then they laughed. They said, “No, no, no. 这不是政府做的. 这是我们企业一起做的.”I said, “你们企业一起做。你们不是竞争对手吗?” “是啊,我们是竞争对手。不过我们有这么多客户,他们来的时候要能够看到全部温州的这些打火机,会比较容易,就会再继续来温州买这些打火机.” “不过你们是竞争对手?”“我们有竞争也有合作。” Wow, this is really quite something. So I came away very impressed and in fact, I went to the bookshop and bought a few books including one of them that is called “中国的犹太人”. It is the way that they worked with one and another.

33  The second example is when I was Minister for Education. I wanted to learn how the Swiss and the Germans were training their people. Our polytechnics and our ITEs have been modelled after the Swiss, and German system – what they called the duo system – that means you work and you work but you also learn on the job. In that way, the young people can learn better.

34  I went to a Swiss company that producing very high tech precision engineering equipment. They had about 100 trainees. I was surprised as the factory didn’t look very big to me. I asked, “You hired 100 people every year?” So they said, “No, no, we only hired a part of it.” Then I said, “What happens to the rest?” They said, “These are other companies.” I said, “Other companies? Same business?” They said yes. I was so puzzled and asked, “Why are you training for your competitors?” The answer I really learnt a lot. They said, “This is Swiss precision industry. We want to maintain the brand name of the Swiss precision industry. So if you don’t have enough trained people, what will happen? The quality will go down. When quality go down, even if I am the best company, people will begin to say, Swiss standard isn’t good. So in the end, everyone suffers.” So he said, “Why don’t we work together and train people? So everyone will be better. We will all benefit.” I came away really impressed.

35  When I visit other parts of the duo training system, including in the banks, and in various places, I saw a similar thing – the industry came together to train young people, older people, so that everybody’s skills can move up and industry works together to move up. That is why when we launched the Committee for Future Economy, even before the report was out in the Budget the year before, I announced the Industry Transformation Maps where we can get all our agencies to work together with all our businesses to make the changes.

36  I’m very happy that Singapore Chinese Chambers now have many TACs that are working together with you, and also the TA (Trade Association) Hub, and also the Singapore Business Federation. I think this is the right way to go, and I hope that our TACs can play an important role to help one another to build that capability to compete, to embrace technology, and to ensure that we can do this.

37  I’m also now chairing the National Research Foundation, and one of the things that I would like to do is that our research should not just be in our universities. Our universities have done very, very well, but what is more important is that the technology that we have must be used by our companies. Because if we don’t use the technology, we will be left behind. So that was a really good example of Wenzhou and Switzerland.

38  Recently, just three weeks back, I was in Holland to learn about their R&D system and what they are doing. In Holland, I learnt a few new words. One of them is the spirit of collaboration amongst institutions. They called it the “Golden Triangle of Innovation”. In Asia, when we talk about the “Golden Triangle”, we think about drugs. But here, “Golden Triangle” means something really good, “推动创新的金三角”.

39  In everything that they do, there must be three parties – the Government, the industry/businesses, and the universities/academia. I asked why. They said the Government has to set the rules. The industry has to try new things, and the universities can provide R&D that is relevant to the businesses.

40  For instance, I went on a self-driving vehicle on a highway at 150km/hour! I was at the back of the car when the driver said “I will change the control, and if the car in front jam-brakes, our car will jam-brake.” So he controlled the vehicle through the walkie-talkie, and the car did jam-brake. I asked how did they manage to do this. That’s where they told me about the Golden Triangle, because what the Government has to do is not just a simple thing. It has to change rules and regulations, and in particular, it has to change how the lamppost will be. The lamppost is a very smart lamppost. So I asked what is being done in other parts of Europe, but I’ll keep the story for another occasion. But I learnt a lot from what they were doing.

41  I was very curious and asked a lot of people why they were able to do this, and able to work with one another very well. They said it’s the “Polder culture”. Between a quarter and half of Holland’s land is under the sea-level. Over hundreds of years, when you see the windmill, the windmill is not just for decoration. The windmill is to pump water out from the very waterlogged area, so that the water can be moved out and discharged to the sea. Meanwhile, they build polders so that the seawater cannot come in. They spent a lot of money every year to maintain the polders. The result of doing this is that everyone is responsible for maintaining a part of the polder. If you don’t do your part, and that part breaks, everyone will be drowned when the seawater comes in.

42  Therefore, the habit of working with one another so that they can all survive became very, very ingrained, and became a part of everything that they do, where businesses cooperate with one another, where the Government, industry and universities all come together to say “What is the common challenge that we have?” and “What can we do together better?”

43  I think this is something a small, open economy like Singapore must do. In our businesses, of course we compete but we also collaborate. In the same way, I’m very happy to meet this morning some of the entrepreneurs from Malaysia, from other parts of ASEAN, and from China as well, I think they are welcomed to collaborate with Singapore businesses so that together, it’s a much bigger market in the world. The more that we work together, the more we can achieve economies of scale, and that we can go out, and yet each of us create something special, the better it is.

44  My favourite example is the hawker centre for this model of cooperation. In a hawker centre, if everyone sells the same chicken rice, in the end only one stall will survive because how many of us wants to eat the same chicken rice every day? But if the hawker centre has a nice variety of food and if every stall is good, we’ll go back to the hawker centre every day. So this is a very good example of how we can collaborate and cooperate at the same time.

45  SMS Sim Ann is here and she has a very famous hawker centre in her constituency, the Bukit Timah Hawker Centre. I was just there the other day, and I noticed that there’s really quite a variety; and because of that variety, it was extremely crowded. So it’s a good example of how each of us must do something special, but together we make the hawker centre even more famous.

46  I’m very happy to meet Thomas Pek (from Tai Hua Food Industries) this morning. Many years ago, when I was running the Trade Development Board, I had many small businesses that came to me to apply for a grant to go for a food exhibition in Germany. But each application comprised only a few companies, so no one would notice a small booth there. So I asked my officers to ask them to consider doing a common stand (with the branding) “Singapore Food”. But there was no news after a few weeks. When I checked with them again, they told me that (the companies) said I was a “silly bureaucrat” – 做政府工,不会做生意 (in Hokkien)! 我们是竞争对手,教我们一起(做生意),siao 啊!

47  Later on, when I was chairing the CFE, I was very happy to see how the food manufacturers have come together to put up “Singapore Food” on TMall, and now everyone knows about Singapore food. At the same time, they have worked together to build a common kitchen together with JTC, so that everyone can preserve the shelf life of their food without adding preservatives.

48  I think this example reminded me of what I saw in Switzerland, in the Netherlands, and in Wenzhou. That by working together, it doesn’t mean that we don’t compete. But then there are many areas that we have common problems, and for common problems, we should come together for a common solution. In that regard, the Government is very, very happy to work together with you to solve these common problems.

49  But how each one of you will have something special, your special sauce, to make your hawker stall particularly good. Your special recipe is your trade secret and we must respect that. But at the same time, there are many common problems that we can come together to solve, whether it is a problem that (SCCCI President) Roland mentioned, when you do the survey about cost of doing business and so on.


50  On that note, I hope that we continue to learn together, and I’m also very happy to hear that many of you have embraced this Group-based Upgrading (GBU) initiative that was announced in 2017 by Enterprise Singapore, with help from business advisors, to adopt a group-based solutions approach in tackling common business challenges. I’m confident that our business chambers and trade associations will continue to work together and work hard to solve these common problems.

51  Let me also mention that on the Government’s end, the economic agencies have a lot of schemes. Where it is useful to you, please make full use these schemes. These are very useful schemes which it’s important that as part of the Golden Triangle, to play your part. So, get the details from Enterprise Singapore and EDB, and work together on that.

52  I hope that we continue to promote this culture of entrepreneurship and culture of partnership. Good entrepreneurship is not just about having a good idea, but really the alertness to look for changes, look for new opportunities and the hard work to get these things done; and at the same time, knowing when to compete and when to cooperate; and that this spirit of partnership amongst businesses and business partners, both in Singapore and outside of Singapore, I think will serve our companies very well.

53  I hope that you keep up the 企业精神、合作精神 – 要竞争也要合作。谢谢大家!