Speech by Deputy Prime Minister and Minister for Finance Heng Swee Keat at the Opening Plenary of the Global Maritime Forum Annual Summit 2019 on 30 October 2019.
Mr Peter Stokes,
Chairman of the Global Maritime Forum,
Dr Lam Pin Min,
Senior Minister of State for Transport and Health,
Mr Loh Ngai Seng,
Permanent Secretary for Transport, Your Excellencies,
Ladies and Gentlemen,
I am very happy to join you this morning for the second edition of the Global Maritime Forum Annual Summit. To our guests from overseas, a very warm welcome to you. This Summit is an occasion for leaders from the industry, international organisations and governments to come together, to discuss the latest developments in the maritime industry, exchange views and explore new areas of collaboration. By working together, we can create a better future for all.
Maritime trade has been Singapore’s lifeblood and an integral part of our national identity. Hosting the Summit this year is of additional significance to us, because we are also commemorating our Bicentennial – which marks the founding of modern Singapore two hundred years ago, and the establishment of a free port here.
Where we are gathered today – Gardens by the Bay – was where the original Singapore Harbour was. This may be hard to imagine, as we have reclaimed and transformed this plot of land. But 200 years ago, there would have been all kinds of ships anchored here: Chinese junks, Bugis prahus, Arab dhows, East Indiamen, and ships from different parts of the region and from Europe. Smaller vessels would have been shuttling back and forth between the anchorage here and the warehouses along the banks of the Singapore River, loading and unloading their cargo. In fact, Singapore was already part of a vast regional maritime trading network well before the arrival of Sir Stamford Raffles and the British East India Company. Ancient texts tell of a bustling port city here as early as the 13th Century. Archaeologists have unearthed numerous artefacts from all over the region, suggesting that ancient Singapore – or Temasek, as it was then called – had been a maritime emporium.
Key Drivers of Change in the Maritime Industry
The maritime industry has put Singapore prominently on the global map and it remains critical to the Singapore economy. We are a leading container hub port with the world’s largest transhipment volumes. We are also an international maritime centre, home to more than 150 international shipping groups and 5,000 maritime establishments. Hence, we take a great interest in the future of the maritime industry, and we want to contribute to the development of the maritime community.
Today, more than 80% of global trade still goes via sea routes. Shipping will continue to dominate trade flows in the years to come, as it is the most cost-effective means to move goods from one part of the world to another. But the world is changing. Three key trends in particular can fundamentally change how the maritime sector operates: One, stresses on the international trading system; Two, climate change; and three, technological advancement.
To stay relevant and stay ahead, the maritime sector needs to ride the winds of change and the waves of disruption. Let me share my thoughts on how we can respond to each of these trends.
First, we must continue to uphold an open, rules-based multilateral trading system, at a time when the global order is under pressure. The General Agreement on Tariffs and Trade (GATT), which was set up in wake of the Second World War, established a set of global trading rules. Since then, GATT was succeeded by the World Trade Organisation (WTO). World trade has expanded significantly over the years. In 2018, world exports was more than 300 times the level in 1948. The expansion of trade and investment has enabled economic growth of an unprecedented scale all over the world. In recent years, the global trading system has come under stress – trade frictions are rising, investors are facing greater uncertainty, and the benefits of growth have been unevenly distributed. This is an issue that the global community must address – to review and update the global rules, and to undertake difficult structural reforms in each of our economy. The benefits of a global division of labour are considerable, and it is critical that countries work together, and uphold our multilateral system and institutions.
The maritime sector, in particular, has benefited from global rules, the most significant of which are multilateral agreements like the United Nations Convention on the Law of the Sea (UNCLOS) and institutions such as the International Maritime Organization (IMO). UNCLOS has created a rules-based framework vital for maritime trade, in particular striking a balance between the rights of coastal states and the right to freedom of navigation, including the straits used for international navigation, like the Straits of Malacca. The IMO has established a common international standards for shipping to ensure safe, secure and efficient shipping as well as clean oceans.
Singapore has been a longstanding supporter of the IMO and UNCLOS. We have been an IMO member State since 1966, and have been on the IMO Council since 1993. We had also participated in the negotiations on UNCLOS and ratified the Convention in 1994.
Multilateral frameworks have been the basis for the growth of the maritime sector. We must therefore redouble our efforts to strengthen the multilateral system, and create a stable, mutually beneficial environment where countries can come together to tackle common challenges.
Commit to Sustainability
Second, we must work together to address the common challenge of climate change. Climate change is an existential issue, for many parts of the world, and particularly for island states like Singapore. Singapore is committed to doing our part under the Paris Agreement, and reduce our emissions intensity by 36% from 2005 levels by 2030.
In the maritime sector, sea trade is still the most energy-efficient and environmentally-friendly mode of transporting cargo. But the IMO has not stood still. It has adopted an ambitious strategy aimed at reducing greenhouse gas emissions from shipping by at least half before 2050, compared to 2008 levels. Come January 2020, the IMO’s 0.5% global sulphur cap for marine fuels will come into force.
Singapore fully supports these efforts, and we will continue to contribute. We worked with fellow IMO Member States to find common ground on the IMO’s adoption of the Initial Strategy on the Reduction of Greenhouse Gas Emissions from Ships. We have also put in place measures to support companies to adopt clean and green shipping practices, over and above the minimum required by IMO Conventions.
We believe that Singapore can do more. We are already ready for LNG bunkering today. This provides a cleaner and greener fuel alternative to meet the future needs of shipping. As part of our efforts to develop Singapore’s LNG bunkering ecosystem, the Maritime and Port Authority of Singapore (MPA) has also co-funded two LNG bunker tankers. The first tanker will be delivered in the third quarter of 2020. This will coincide with the anticipated increase in LNG demand, as more ocean-going LNG-fuelled vessels come into operation and call at our port. We set up the Centre of Excellence for Maritime Energy and Sustainable Development, at the Nanyang Technological University, to provide innovative solutions in the areas of sustainable maritime operations, emissions management and energy management.
I have spoken about the need to uphold multilateralism and to commit to sustainability. The third key trend confronting the maritime sector is the rapid advancement of technology. By harnessing the potential of technology, we can propel the maritime sector forward.
New technologies are opening up new possibilities for physical port infrastructure and port connectivity. Our new port in Tuas is expected to commence its first phase of operations in 2021, and will be fully completed in the 2040s. Tuas Port will be equipped with the latest technologies and systems to meet the future needs of the maritime industry. Long linear berths and deep-water capabilities will provide maximum flexibility to accommodate ships of different sizes.
In addition, the MPA is working with industry players to test-bed new technologies and concepts to improve efficiency, safety and security. One example is our Next Generation Vessel Traffic Management System that will enhance the safety of navigation for ships, by leveraging digital technologies and data analytics for enhanced maritime situational awareness and proactive traffic management. Later this morning, the MPA will be signing a MOU with Norway’s DNV GL, to initiate joint industry projects in new and promising areas – such as low and zero carbon ship fuels, remote controlled ship operations, and blockchain technologies for port and shipping processes.
Singapore is also investing in digital platforms to promote data sharing and improve the efficiency of our port and maritime industry. I am happy to announce that Singapore will be launching a new maritime single window for vessels called ‘digitalPORT@SG’. ‘digitalPORT@SG’ will be developed in two phases. The first phase will provide one-stop clearance for vessel-related transactions. This simplifies the current reporting processes required by the three public agencies – the MPA, the Immigration & Checkpoints Authority, and the National Environment Agency – for all arriving and departing ships. This will be rolled out progressively from December this year, and is estimated to save the industry 100,000 man-hours per year.
The second phase will be rolled out over the next few years. ‘digitalPORT@SG’ will be a single digital shopfront for the booking of terminal and marine services, facilitating Just-in-Time (JIT) operations for optimal vessel passage planning in port. We will also make the vessel and cargo clearance processes seamless for vessels coming to Singapore. ‘digitalPORT@SG’, the single window for vessel clearance and services, will be interoperable with our Networked Trade Platform (NTP), the single window for cargo clearance and services. For example, advance arrival and departure information declared by vessels will be shared seamlessly across the two platforms.
We also hope to make ‘digitalPORT@SG’ interoperable beyond Singapore’s shores, so that industry players can gain greater operational efficiency. For a start, MPA has signed an MOU with the China Maritime Safety Administration to cooperate on the use of electronic certificates for ships. This allows for seamless exchange of ship credentials for port regulatory functions. MPA is similarly collaborating with Denmark, Finland and Panama on this.
Our vision for the global maritime industry is for ships, ports and global platforms to share data and operate seamlessly. “digitalPORT@SG” is Singapore’s contribution to help connect our seas and oceans with a single “digital ocean”.
I have outlined how the maritime sector can ride the winds of change and waves of disruption – by upholding multilateralism, by stepping up our efforts on sustainability, and by harnessing the advancement of technology. This will require the collective effort of industry players, multilateral institutions and governments. Earlier, we heard from Peter the four big topics of discussion that you are having over the next two days. These are extremely good initiatives for the industry to come together to discuss this.
Together, we must be prepared to agree on and make bold moves to position the maritime sector well for the future. From our own experience developing Singapore’s maritime sector, I am glad earlier generation of leaders took bold decisions. We took the plunge and built the region’s first container terminal in 1972, when containerisation had yet to fully take off. And Singapore continues to look ahead today, push the frontiers, and introduce new solutions like ‘digitalPORT@SG’.
I am glad that we have platforms such as the Global Maritime Forum for leaders from different parts of the maritime industry, from across the world, to come together – to discuss the latest developments, exchange views, and new areas of cooperation. Your forum theme is ‘taking the lead’. I hope that by staying focused on the future and work together, the global maritime community can take the lead to chart a forward-looking course for the global maritime community for many more years to come.
I wish you all a very productive Summit, and I hope that all of you will have an enjoyable stay in Singapore. Thank you.
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