Speech by Deputy Prime Minister and Minister for Finance Heng Swee Keat at the Olam 30th Anniversary Dinner on 14 November 2019.
Mr Lim Boon Heng,
Chairman, Temasek Holdings,
Mr Lim Ah Doo,
Chairman of the Board of Olam International,
Mr Sunny Verghese,
Group CEO of Olam International,
Board members, past and present,
Ladies and gentlemen,
A very good evening to all of you. My heartiest congratulations to Olam for 30 years of success. I am very happy to join you all tonight to celebrate this milestone.
From its humble beginnings trading a single product from a single country – cashews from Nigeria – in 1989, Olam has grown to become a global agri-business.
It now trades in 47 products across more than 60 countries. This includes operating capabilities across 25 countries in Africa. Olam’s operations now span farming, buying, processing and sales operations.
Today, Olam’s annual sales figures exceeds 30 billion Singapore dollars, and the company has created over 40,000 jobs around the world.
We are proud that Olam has become a leading Singaporean brand.
Olam shifted its headquarters from London to Singapore in 1996. As a growing company, Olam recognised how the strengths of Singapore’s business environment can help it to scale further heights.
Our capable workforce, good quality of life and focus on developing and attracting talent allow Singapore to have an edge.
Our strong financial infrastructure and institutions support global traders, who need:
A range of high quality, competitive services, such as trade finance and insurance;
A range of risk management and hedging solutions, which the Singapore Exchange and other players provide; and
A stable and predictable operating environment for our businesses, which our commitment to the rule of law provides.
Over the years, Singapore has also developed a strong dispute resolution eco-system for cross-border transactions.
The growth of Olam reflects your business acumen, as well as the growth of Singapore’s agri-commodity ecosystem.
We are now the second largest trading hub in the world for agri-commodities after Geneva, capturing over 20% of the global agri-commodity trade flows.
Many international traders have set up here, and Singapore is the leading trading hub for rubber, palm oil, cocoa, soybean and pulses.
Last year, the trading community in Singapore generated more than $1.7 trillion in global trading turnover and created more than 15,400 jobs.
Despite the uncertainty over the global economy, Singapore remains competitive and there are strong foundations that our businesses can build on.
Growth of the global agri-commodities sector
The long-term prospects in the agricultural sector remain positive.
If global population grows as expected, by 2050, calorific demand will rise by 70 percent, and crop demand for human consumption and animal feed will increase by at least 100 percent.
Olam has been enterprising in capturing emerging demand.
Olam is able to tap on your extensive network of production and export hubs to adapt nimbly to changing market conditions.
Beyond trading, Olam has been active in finding new ways to serve your customers, such as in offering risk management solutions and traceability services.
We hope that more local enterprises will, in the same spirit, stay nimble and innovative.
Indeed, the ability to innovate will be vital in a time of rapid technological change.
The agriculture industry is being reshaped by advancements in many areas, such as in precision agriculture, and livestock technology.
Blockchain technology and artificial intelligence are changing how trade is conducted.
Olam adapted to changes well, having successfully embarked on technological transformation to generate business efficiencies, improve its bottom line, and be disruptive in the markets it serves.
Olam’s Farmer Information System, otherwise known as OFIS, is one good example.
OFIS is a smallholder farm data collection platform providing smallholders with management tools, and sharing with them information about the provenance of products.
Olam’s Digital Program Management Office in Singapore is now working with Enterprise Singapore to source for local partners with expertise in identity verification, biometric security and fintech to further develop OFIS.
With these enhancements, data collected via the platform can potentially be used to improve the credit-scoring algorithm of farmers, enabling the provision of micro-financing loans to smallholder farmers.
I am glad that Olam is bringing local SMEs together to contribute to helping smallholder farmers in the region and the world.
Such partnerships between large enterprises and SMEs will help us to improve capabilities across the economy.
The Government will continue to support the formation of strategic partnerships to help businesses accelerate their technological innovation journey.
For instance, Enterprise Singapore is working with a few global palm oil traders to pilot the use of blockchain technology for product traceability across the value chain.
Strong partnerships will also help us to achieve greater sustainability for Singapore and the world.
Sustainability is not just about protecting our planet for the future, but also makes good business sense today
For instance, there will be growing demand for sustainable products and services, from consumers, including from a younger generation, that value sustainability.
To support businesses to achieve greater sustainability, we have set aside 900 million dollars for urban solutions and sustainability. Among others, we are supporting research and development in agritech and foodtech, and providing platforms for companies to test-bed new solutions in Singapore. We welcome companies, including Olam, to work with our research institutions and other industries partners on sustainability.
I am glad that Olam is an industry leader in promoting sustainability.
Last year, Olam launched AtSource – a comprehensive sustainable sourcing solution for agricultural raw materials and food ingredients.
AtSource allows customers to directly trace the source of supply at each stage of a product’s journey.
This will also enhance Olam’s ability to assess and positively influence the environmental footprint of the 4.8 million farmers in the company’s supply chain, the vast majority of whom are smallholders growing crops such as cocoa, coffee and cashew in emerging markets.
Olam’s efforts in sustainability has also been recognised – Mr Sunny Verghese was appointed Chair of the World Business Council for Sustainable Development last year, the first chair from the agriculture sector.
We urge more businesses to include sustainability in your mandate, so that the industry can make a bigger difference to Singapore and the world.
Efforts to capture external opportunities, leverage on technology and champion sustainability will keep our agri-commodity sector competitive over the long term.
Our end goal is to create good jobs for our people. To prepare to take on these jobs, our workers must learn and develop new skills and competencies, to keep up with the changes.
The Government is building a steady pipeline of talent to take on good jobs in the sector. We have put in place specialized manpower initiatives.
For example, this year, NTU launched a new Minor in International Trading, focusing on business and technical knowledge in the commodities trading sector. More than 300 students have enrolled in this program so far.
Government agencies, E2I, SMU and the Singapore Business Federation have also put in place training programmes and job placements in the wholesale trade sector. Through this, close to 1,000 professionals successfully received job placements this year.
The combined efforts of our Government, workers and companies have yielded good results.
I thank Olam for your dedication in providing growth opportunities and good jobs for our people.
Let me once again congratulate Mr Lim, Mr Verghese and their team for steering Olam to this major milestone.
You have achieved 30 years of excellence.
I look forward to seeing Olam achieving even greater success in the years ahead!
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