Singapore Investment News - Singapore Economic Development

sedb.com
Singapore
Investment News
Singapore nurtures talent
for Asia and beyond
October - December 2011
5
12
Contents
02 BUSINESS BRIEFS
05 FEATURE
Indian companies eye Singapore as
internationalisation gateway
Major infrastructure companies from India like
Punj Lloyd see Singapore as an ideal launch pad to
penetrate markets in Southeast Asia and beyond.
08
FEATURE
Asia’s talent generator
With its excellent location, high quality of life and a
variety of leadership development programmes to
choose from, Singapore is bolstering its standing as a
dynamic global city.
12
REPORT
Deloitte partners EDB for data analytics think tank
Deloitte establishes its first Asia-Pacific data analytics
think tank in Singapore as part of its strategy to enhance
its regional capabilities in the rapidly developing field of
data analytics.
14
REPORT
Singapore’s chemical industry gets a boost with JAC’s
aromatics plant
The latest addition to Jurong Island bodes well for the
Republic’s reputation as a leading chemical hub.
16
REPORT
Coca-Cola opens new concentrate plant in Singapore
New concentrate manufacturing plant leverages
Singapore’s regional connectivity and skilled manpower to
support The Coca-Cola Company’s growth in Asia Pacific.
18
REPORT
Living with green energy
Singapore partners Panasonic for the first total energy
solutions public housing test-bed in Asia.
20
REPORT
Moulding into a regional hub
Singapore’s dynamic and strategic business environment
has contributed to Borouge’s status as a global powerhouse
for innovative plastics solutions.
22
SPECIAL
Future Ready Today_
This special series of articles discusses what tomorrow’s
challenges mean for today’s businesses. In this issue, we
look at how Asia is flourishing as the new centre for the
arts amid rapid economic growth and Singapore’s efforts
to position itself as a hub for the visual arts industry.
Business Briefs
Trina Solar sets
up regional HQ
in Singapore
Sinopec builds
lubricant plant
in Singapore
Gao Jifan, Chairman and CEO of Trina Solar, at the inaugural PV
Asia Pacific Expo, held as part of the Singapore International Energy
Week 2011
Sinopec executives break ground in Singapore for the company’s first
lubricant plant outside China
Trina Solar, a leading integrated manufacturer of solar
photovoltaic (PV) products worldwide, is establishing its
Asia-Pacific operating headquarters in Singapore to
strengthen its growing presence and customer base in
the region. This comes on top of Trina Solar’s existing
collaboration with the Solar Energy Research Institute
of Singapore to develop high-efficiency back-contact
solar cells.
Sinopec Lubricants, a subsidiary of the world’s second
largest oil refiner, is set to build its first lubricant plant
outside China in Singapore in an effort to establish
Sinopec’s brand presence in Southeast Asia. The project
is Sinopec’s first manufacturing investment in Singapore
and demonstrates growing ties between the two countries.
In addition, the plant marks the company’s first wholly
owned greenfield international investment in the oil and
gas downstream. When the US$91 million (S$115.8
million) facility is completed in September 2012, it will
serve as the company’s regional hub for production,
servicing and logistics in the Asia Pacific, including
Australia and New Zealand. To cope with the demand for
lubricants in the region, the 40,000-square-metre plant is
expected to produce 100,000 tonnes of lubricants annually.
The new administrative region is expected to include
Singapore, Thailand, Malaysia, the Philippines, India,
Japan, Australia, New Zealand and South Korea,
extending to the Middle East and South Africa in the
future. Over the next few years, the Singapore office
is expected to contribute significantly to the company’s
global sales.
Asia is widely regarded as the new growth frontier
for the clean energy sector, and China has emerged
as a global powerhouse in the industry. Increasingly,
Singapore complements China’s growth by providing a
platform for Chinese clean energy companies like Trina
Solar to internationalise their business.
During the groundbreaking ceremony on 28 July, Lim
Swee Nian, Assistant Managing Director, Singapore
Economic Development Board, noted that Singapore
has the right ecology of suppliers and service providers
to support lubricant manufacturers like Sinopec. They
can also leverage Singapore’s excellent trade and
physical connectivity to understand and access
international markets.
“Singapore’s excellent investment environment,
combined with its skilled talent base and strong
logistics infrastructure, makes it a strategically
advantageous location for Trina Solar to establish our
regional headquarters,” said Gao Jifan, Chairman and
CEO, Trina Solar. �
“For Chinese companies, logistics and cultural connectivity
to China is important. Singapore can serve as the
internationalisation platform for many Chinese firms by
serving as a cultural and logistical bridge,” Lim said. �
2
Mitsui Chemicals
opens R&D centre
Visa expands
Singapore office
The opening ceremony of MS-R&D was officiated by Lim Chuan Poh,
Chairman, A*STAR (third from left)
(left to right) Andrew Tan, Global Finance Executive, Visa; Quek Swee
Kuan, Assistant Managing Director, EDB; Elizabeth Buse, Group
President for Asia Pacific, Central Europe, Middle East and Africa, Visa;
and Rene Ho, Senior Executive, VISA, at the ribbon-cutting ceremony
to open Visa’s new Singapore office
On 9 September, Mitsui Chemicals, Inc. (MCI) held a
ceremony to commemorate the establishment of its first
research and development (R&D) facility outside Japan.
The new Mitsui Chemicals Singapore R&D Centre
(MS-R&D) in the Singapore Science Park marks the
company’s fourth major investment in Singapore.
MCI believes Singapore is the ideal location as it is a top
player in the growing Asian chemicals market and offers
world-class access to strategic markets. The Singapore
government’s support for companies relocating their
R&D facilities to the country is a further boon.
By tapping into Singapore’s strategic location,
MS-R&D will be able to combine R&D with business
model development to enhance new business
opportunities and develop MCI’s human resource base.
This puts MCI in a better position to strengthen its core
business, accelerate globalisation and enhance its
business presence in Asia.
Speaking at MS-R&D’s opening ceremony, Lim Chuan
Poh, Chairman of the Agency for Science, Technology
and Research (A*STAR), said, “I am confident that this
R&D centre will produce many innovative technologies
and products, which will play a key role in the
development of MCI’s global business. A*STAR also
looks forward to many productive collaborations with
the Mitsui R&D Centre in Singapore.” �
Electronic payment network, Visa Inc., has expanded
its office in Singapore to support its growing operations
in Asia Pacific, where electronic forms of payment,
particularly debit and pre-paid cards, continue to
gain popularity. According to Elizabeth Buse, Group
President for Asia Pacific, Central Europe, Middle East
and Africa, Visa Inc., the growth can be attributed to
economic expansion in the Asia Pacific, with a growing
middle class spurring intra-regional trade.
At the opening of the new Singapore office, located
at 71 Robinson Road, Buse said the city-state is
now home to most of Visa’s operations outside the
United States and the office expansion is indicative of
Visa’s confidence in Singapore as an ideal place to
live and work. “In less than four years, the number of
Visa employees in Singapore has grown significantly.
This is a tribute to the strength and potential growth
opportunity of our business,” said Buse.
Congratulating Visa on the opening of its expanded
Singapore office, Quek Swee Kuan, Assistant Managing
Director, Singapore Economic Development Board,
said, “We are delighted that Singapore has been a key
partner to Visa as it grows its operations internationally.
Visa’s decision affirms Singapore’s value proposition as
the preferred home for international companies to locate
their key business functions and leadership teams to
drive their business in Asia and globally.” �
3
Business Briefs
Zeon opens
new synthetic
rubber plant on
Jurong Island
PAREXEL partners
NUS to hone clinical
research talent
in Asia
Kagami Biraki ceremony at Zeon Corporation’s S-SBR dinner
celebration during the groundbreaking ceremony
Associate Professor Chan Sui Yung, Head of the Department of
Pharmacy, NUS (left) and Josef H. von Rickenbach, Chairman of the
Board and CEO, PAREXEL International (right), seal the partnership for
the new postgraduate certificate programme with a handshake
Japan’s Zeon Corporation marked its first major
investment in Singapore when it broke ground for its
S$240 million (US$188.5 million) synthetic rubber
plant on Jurong Island on 1 September. The Solution
Polymerized Styrene-Butadiene Rubber (S-SBR) facility
aims to meet the rising demand for environment-friendly
and fuel-efficient tyres across Asia.
The investment is in line with Zeon’s goal of doubling
its output for tyre grade S-SBR to over 20 per cent of
its global synthetic rubber production capacity. Using
unique technology suitable for the silica compound, the
plant will produce tyres with low rolling resistance and a
good wet grip.
Singapore’s strong IP protection regime and proximity
to regional markets, and access to feedstock supplies
on Jurong Island are key factors for chemical companies
like Zeon to set up operations here. “Jurong Island’s
vibrant and unique ecosystem of companies in the
petrochemical industry also supports Zeon’s
pioneering pursuit of high performance SSBR
products,” said Naozumi Furukawa, President and
CEO, Zeon Corporation. �
4
A new postgraduate certificate programme in Singapore
aims to meet the increasing demand for clinical research
talent in Asia. The programme stems from a partnership
between PAREXEL International Corporation and the
National University of Singapore (NUS), through the
NUS Academy of GxP Excellence (NUSAGE) of its
Department of Pharmacy.
The 10-week Postgraduate Certificate in Good Clinical
Practice will cover topics such as drug development
processes, regulatory affairs and conducting clinical
research. According to Dr Albert Siu, Vice President,
Learning and Development, PAREXEL International,
course graduates will be empowered to make a
difference in the delivery of innovative new treatments
to patients. The programme will also equip clinical
development professionals with critical skills to translate
research into quality healthcare solutions for patients.
“NUSAGE is glad to partner PAREXEL to enable the
next generation of clinical development professionals
to effectively and efficiently move research out of the
laboratory into clinical studies – ultimately to bring
significant life-saving treatments to patients in Asia and
around the world,” said Associate Professor Chan Sui
Yung, Head of the Department of Pharmacy, NUS. �
Feature
Indian companies eye Singapore
as internationalisation gateway
Major infrastructure companies from India like Punj Lloyd see Singapore as an ideal
launch pad to penetrate markets in Southeast Asia and beyond.
Heera Redevelopment Project, India. Punj Lloyd won the bid for this prestigious project in Mumbai in 2007 based on the experience of its subsidiary,
PT Sempec Indonesia, which was acquired as part of the Singapore-based Sembawang E&C
Along with China, India has been in the spotlight in
recent years as a rapidly emerging global economic
player. The country has long been known as a digital
and information technology (IT) powerhouse. This time,
however, India is making its international presence felt in
another area: Infrastructure development.
5
Feature
India’s brisk economic growth has paved the way for
rapid urbanisation in its major cities. This has given
rise to huge infrastructure investments that are, in turn,
fuelling much of the country’s development. In its 12th
Five Year Plan, India projected infrastructure investment
of a whopping US$1 trillion (S$1.27 trillion) over the next
five years. This figure is expected to go up even more:
Experts peg that the country will account for six to seven
per cent of the global construction market by 2020,
trailing only China and the United States.
Given the country’s vitality, major players in India’s
infrastructure sector such as Larsen & Toubro, Punj
Lloyd Group (Punj Lloyd), Lanco Infratech Limited
(Lanco), The Jaypee Group and NCC Ltd have billiondollar projects in the pipeline and are now looking for
new markets beyond India’s borders. With their size and
experience, many of these players are now setting their
sights on Asia.
It stands to reason: Asia’s economic vitality and growth
presents a positive contrast to the current economic
landscapes in Europe and the United States, making
it the region to watch. Asia’s infrastructure market was
estimated at US$8 trillion (S$10.18 trillion) in 2010
and is expected to grow even more in the near term.
In Southeast Asia alone, the infrastructure industry is
estimated to grow to US$700 billion (S$890 billion) by
2015. Singapore sits at the epicentre of this market. As a
major financial and corporate hub in Southeast Asia, the
country serves as the perfect location from which global
companies can operate.
Reserve Bank of India statistics
indicate that 23 per cent of India’s
outbound foreign direct investment
value came through Singapore
in 2010.
project developers to channel money raised from the
markets into potential green field projects.
Indian Companies Take the First Step
Taking into account the many advantages that Singapore
affords businesses, it comes as no surprise that major
Indian companies are expanding into Southeast Asia
and beyond via the city-state. In fact, Reserve Bank
of India statistics indicate that 23 per cent of India’s
outbound foreign direct investment value came through
Singapore in 2010.
Singapore as a Launch Pad to the Rest of Asia
Despite few natural resources, Singapore has taken
advantage of its strategic geographical location and
excellent connectivity to become one of the leading
economic and financial centres in the world. The
government continues to encourage a pro-business
environment, ensure strong intellectual property
protection and devote efforts to build a highly skilled,
diverse workforce for businesses locating here. The
move has paid off, making the country a prominent
centre for business in Asia.
In recent times, two Indian infrastructure giants, Punj
Lloyd and Lanco, have established their presence in
Singapore as a first step towards international expansion.
These companies view Singapore as their gateway
to Southeast Asia, given the country’s deep financial
market and strong regional and global links. Singapore’s
proximity to large Asian export markets like China,
South Korea, Thailand and Taiwan also makes it the
ideal location to establish their global procurement and
purchasing functions to fuel projects in India and around
the world.
Infrastructure companies, in particular, have tapped
Singapore’s capabilities as a financial hub and
go-between, providing easier access to multilateral
organisations such as the World Bank and the
Asian Development Bank, which work with the private
sector to identify investible projects in Southeast Asia.
Singapore also allows for a unique business trust
framework that makes it easier for companies to raise
funds from private investors. Such a structure allows
Punj Lloyd Singapore is now the de facto holding
company for Punj Lloyd’s subsidiaries in Asia Pacific.
Operations and decisions concerning the company’s
Southeast Asian expansion come from senior
management holding office in the city-state. In addition,
Singapore is the resource and project management
hub for its 3,200 engineers in the region. “Singapore’s
infrastructure development is among the best in the world
and backed by a proactive government. Our focus in the
6
near future is to have all our international business in
various countries headquartered in Singapore,” said Luv
Chhabra, Director, Corporate Affairs, Punj Lloyd.
Leveraging the Singapore Brand
Singapore’s wealth of experience in building and
maintaining world-class infrastructure for its people is
held in high esteem in the urban infrastructure sector
globally. Despite being a small market, Singapore has
yielded valuable opportunities for Punj Lloyd and its
subsidiaries to participate in marquee projects that
have contributed to the corporation’s international
reputation. For example, Punj Lloyd has been involved
in tank storage projects in the city-state, which is widely
regarded as the leading oil trading hub in Asia. The
company also had a hand in 75 per cent of Singapore’s
Light Rail Transit system, which offers a good testing
ground for Asian cities like Mumbai and Jakarta looking
to set up their own metropolitan rail systems.
These projects also provide technically challenging
endeavours that serve as useful reference for similar
but larger projects that Punj Lloyd and its subsidiaries
undertake in the region. In this regard, aligning
themselves with the Singapore brand is a huge plus.
“Punj Lloyd Group has had an excellent experience in
Singapore. Singapore is a very business-friendly country
with outstanding standards of governance and ethics,
world-class institutions and business sophistication with
“Singapore is a very businessfriendly country with outstanding
standards of governance and ethics,
world-class institutions and business
sophistication with an extremely
well-developed financial market
and efficient legal framework and
labour regulations.”
– Luv Chhabra, Director, Corporate Affairs, Punj Lloyd
an extremely well-developed financial market and efficient
legal framework and labour regulations,” said Chhabra.
By allowing companies to build capabilities and capacity
to undertake more complex and ambitious overseas
projects, Singapore becomes an indispensable part of
their expansion. This partnership can only benefit both
the company and the country. �
Sabah Sarawak Pipeline Gas project, Malaysia. A prime example of India’s expansion into Southeast Asia: Punj Lloyd is leading the construction of the
massive Sabah-Sarawak Gas Pipeline, which spans over 512 kilometres and is the largest pipeline project in Malaysia
7
Feature
Asia’s talent generator
With its excellent location, high quality of life and a variety of leadership development
programmes to choose from, Singapore is bolstering its standing as a dynamic
global city.
Speakers and participants of Singapore Business Leaders Programme 2011. (First row, left to right) Professor Kishore Mahbubani, Dean, Lee Kuan Yew
School of Public Policy, National University of Singapore; Masayoshi Son, Chairman and CEO, Softbank Corporation; Sunny Verghese, Group Managing
Director and CEO, Olam International; Leo Yip, Chairman, EDB; Lee Kuan Yew, former Minister Mentor; Loh Khum Yean, Permanent Secretary, Ministry
of Manpower; Kwan Chee Wei, Executive Director, HCLI; (second row, left) Peter Schwartz, Chairman, Global Business Network and Partner, Monitor
Group; (second row, right) Liu Yonghao, Board Chairman, New Hope Group; (third row, left) Paul Polman, CEO, Unilever
Humans have never enjoyed more mobility than in
the modern era. Scientific innovation is giving rise
to sophisticated transportation and globalisation is
dissolving borders around the world.
8
This has sparked increased flows of educated and
skilled people between countries as they seek better
opportunities. Singapore is uniquely positioned at the
crossroads for global talent travelling between the
East and the West. Its central location in Asia Pacific,
economic competitiveness and efforts to encourage
business and innovation make it a natural hub for global
and mid-sized companies aiming to become a part of
Asia’s rapid economic development. At the same time,
skilled and educated individuals from around the world
are converging in Singapore, attracted by the myriad
possibilities in the city-state.
Riding on these developments, the Singapore Economic
Development Board (EDB) conceived the “Home for
Talent” strategy to further strengthen the country as a
Global-Asia Hub. It transforms the city-state into a
strategic location that helps companies design and
orchestrate their strategies for accessing, developing and
deploying talent through Singapore for Asia and the world.
In addition, Singapore is a growing centre for pan-Asian
human capital research, helping companies in the region
remain at the forefront of effective people strategies.
Blueprint for Growth
Aligned with the “Home for Talent” strategy, the
Leadership Initiatives, Networks and Knowledge (LINK)
programme aims to establish Singapore as the ideal
home for companies to develop and deploy leadership
talent in Asia, for Asia and the world. Under this
initiative, an ecosystem known as LINK@Nepal Hill is
being developed at one-north in Buona Vista, composed
of key stakeholders that will generate new leadership
and talent development practices. These stakeholders
include leading business schools, talent management
and leadership development consultancies and
corporate universities.
The Singapore Economic
Development Board conceived
the “Home for Talent” strategy to
further strengthen the country as a
Global-Asia Hub. It transforms the
city-state into a strategic location
that helps companies design and
orchestrate their strategies for
accessing, developing and deploying
talent through Singapore for Asia
and the world.
Sunny Verghese of Olam International addressing participants at
SBLP 2011
Human Capital Leadership Institute (HCLI)
Given the diversity and complexity of Asia’s business
environment, companies are increasingly keen to invest
in and develop strong leaders with a good grasp of the
region, who are able to develop and execute effective
business strategies. To address the demand, the
Ministry of Manpower (MOM), EDB and the Singapore
Management University established the HCLI as a
national Centre of Excellence for leadership development
and talent management. Specifically, HCLI will drive
pan-Asian industry-relevant research on human resource
issues, develop cutting-edge executive development
programmes and foster rich networks between leaders in
business, government and academia.
“Singapore is happy to share its experience with others.
It can play a role in helping companies develop and
execute effective human capital strategies for Asia,”
said Goh Chok Tong, Emeritus Senior Minister. “In this
respect, we will invest resources to become a hub for
a rich human capital ecosystem. Such an ecosystem
brings together the government, academics and
businesses to adapt best practices to suit opportunities
in Asia. With its robust public-private approach, the HCLI
is a keystone in this ecosystem.”
The Singapore Business Leaders Programme (SBLP)
is the HCLI’s hallmark initiative, aimed at fostering a
deeper appreciation among promising business leaders
of the nuances of a globalising Asia. The SBLP covers
9
Feature
core components of the region’s business and strategic
landscape, including Asian leadership attributes,
challenges faced by global business leaders coming to
the region and by Asian companies expanding globally,
as well as innovation in Asia.
Singapore Human Capital Summit
To facilitate knowledge exchange on talent development
issues in Asia, MOM, the Singapore Workforce
Development Agency and the HCLI organise the
Singapore Human Capital Summit each year. The
conference engages business heads and thought leaders
in in-depth dialogue on talent challenges that companies
in Asia face and presents a valuable opportunity for them
to share best practices to maximise human capital.
The Summit also showcases Singapore’s vibrancy and
efforts to drive talent initiatives for Asia. “Singapore has
grown from a Third World to a First World economy
because of our emphasis on leadership and talent. From
our experience, we believe that for companies to succeed
in the region, they need to develop leaders and talent with
the right knowledge to operate in Asia,” said Goh at the
opening of the 2011 Summit, themed “People Strategies
for Asia – Capitalizing on Asia’s Growth Engines”.
Educational Institutions
Singapore also plays host to leading educational
institutions that offer opportunities for leadership
and talent development, through MBA and EMBA
programmes, as well as executive education. These
include the Chicago Booth Graduate Business School
from the United States, the INSEAD Business School
from France and Singapore’s NUS Business School.
In undertaking research activities and running
customised leadership development programmes for
companies, many of these educational institutions seek
to provide executives with insights into the opportunities
and challenges of operating in Asia – from the unique
characteristics that make Asia the most exciting growth
region in the world today, to the complexity of operating
across markets and economies in the region.
Talent management and leadership consultancies
Also setting up shop in Singapore are major human
resource (HR) consultancies and associations. The RBL
Group, a consultancy led by renowned human capital
thought leader, Professor Dave Ulrich, launched its first
Asia office in August. In September, The Chartered
Institute of Personnel and Development, Europe’s largest
HR professional body, opened its Asia-Pacific office to
conduct research, deliver senior leadership programmes
and help businesses in the region deliver uniquely Asian
HR strategies.
Reinforcing Singapore’s Position as a Global-Asia Hub
Companies have always been on the lookout for new
markets and new opportunities. Now, more than ever,
companies seeking to expand have to swim with the
cross currents: Western companies desiring to gain a
foothold in Asia recognise the need to groom in-house
management talent with a deep pan-Asian understanding
of cultures, markets and business practices. In turn, Asian
enterprises wishing to internationalise their operations
are seeking competent leaders with global perspectives.
These trends put Singapore squarely in the middle of
the confluence, providing the city-state great impetus
to develop the necessary talent infrastructure and
ecosystem, such as LINK@Nepal Hill, and reinforcing
Singapore’s reputation as a global leadership
development hub. Developing such an environment
involves partnerships with leading global companies to
establish their business control towers and talent engines
in Singapore, where they orchestrate their pan-Asian
business operations and undertake strategic talent
decisions. Some recent notable players include:
The Singapore Business Leaders
Programme is the HCLI’s hallmark
initiative, aimed at fostering a
deeper appreciation among
promising business leaders of the
nuances of a globalising Asia.
10
Procter & Gamble opened its Asia Leadership
Development Centre in 2010 that will train over 500
regional leaders annually.
Unilever will set up its corporate university, Four Acres,
at LINK@Nepal Hill in 2013. This global centre for
leadership development will build a pipeline of global
leaders for Unilever to realise the growth opportunities in
the developing and emerging markets.
Yokogawa Electric International, a leading global
industrial automation company, established their global
leadership training headquarters in June and aims to
train at least 100 top leaders over the next three years.
Sumitomo Chemical is launching its corporate institute in
Singapore to train managers for the Asia-Pacific region
on a broad set of areas, with a focus on corporate HR.
The Place to Be
Today, Singapore is a highly attractive location for
both business and personal life. The World Economic
Forum ranked Singapore as the most competitive in
Asia in its 2011 Global Competitiveness Index, and
second globally. Accolades such as these reflect the
government’s efforts over the years to develop in
Singapore a good quality of life, including a safe and
secure living environment, strong public education
system complemented by top quality private institutions
and continuing education and training, as well as
connectivity and accessibility to Asia and the world.
With an increasingly globalised world paired with growing
competition, companies with the right talent strategies
are more likely to succeed in Asia. Singapore’s concerted
effort in striving to become a home for business,
“Singapore would not have achieved
its economic success without the
support from our corporate partners.
Their presence in Singapore not
only provides opportunities for our
economy and people but also draws
other companies here.”
– Leo Yip, Chairman, EDB
innovation and talent, means companies looking to
invest and expand in the region can be confident of
finding the right partners and environment they seek in
the city-state. �
Delegates of the SBLP 2011 at Capella, Sentosa Singapore
11
Report
Deloitte partners EDB for
data analytics think tank
Deloitte establishes its first Asia-Pacific data analytics think tank in Singapore as
part of its strategy to enhance its regional capabilities in the rapidly developing
field of data analytics.
Sealing the partnership for the Deloitte Analytics Institute Asia: (Left to right) Tom Davenport, Senior Advisor to Deloitte Analytics; Philip Yuen,
CEO, Deloitte Singapore; Chaly Mah, CEO, Deloitte Asia Pacific; Lee Yi Shyan, Minister of State for Trade & Industry and National Development;
Tim Phillipps, Global Managing Director for Analytics, Deloitte
Enterprises in every industry face the same dilemma:
Extracting meaning from raw information and applying
the knowledge to their trade is difficult and messy
business, but not to do so could mean missed
opportunities and higher risks. This challenge has
not been made easier over the years even with
developments in technology.
In fact, technological advances are adding to their
predicament as the world is creating and sharing
knowledge at an unprecedented rate, thanks to the
popularity of the Internet, social networking sites and
multi-functional gadgets such as smartphones. They
empower and place creative control in the hands of
12
billions of consumers, resulting in a dizzying array of text,
images, audio and video being generated around the
world every second.
Unravelling Data Mysteries
A study by International Data Corporation (IDC)
commissioned by EMC, a leading provider of storage
hardware solutions, estimated that the world created
and replicated over 1.8 billion gigabytes of information
in 2011 alone. Amid the avalanche of information,
data analytics has been gaining greater attention as
a tool for companies to examine raw data and extract
useful information, as well as gain useful insights to
help them make better business decisions. Gartner, a
leading information technology research and advisory
firm, estimates that the global analytics marketplace is
currently worth some US$25 billion (S$31.8 billion).
With over 3,000 employees worldwide dedicated to
its analytics arm, professional service and consulting
firm Deloitte & Touche (Deloitte) is a frontrunner in
the field of data analytics. To develop its Asia-Pacific
analytics strategy and capability and better support its
clients’ needs, Deloitte joined hands with the Singapore
Economic Development Board (EDB) to set up a new
data analytics think tank in Singapore. “In a global
analytics marketplace anticipated to grow to US$50
billion (S$63.6 billion) by 2015, we are very pleased to
be partnering EDB in launching the Deloitte Analytics
Institute (DAI) Asia in Singapore,” said Tim Phillipps,
Global Leader, Deloitte Analytics.
Unveiled on 25 July, the Institute is dedicated to
advanced analytics research and developing cutting-edge
methods of applying data analytics to help organisations
unlock the significant value of their data. DAI Asia
springs from a multi-year, multi-million dollar commitment
between EDB and Deloitte, which is investing in excess
of US$10 million (S$12.7 million) across Southeast Asia.
Harnessing the Power of Data
The strategic advantages of data analytics are widely
recognised. ISACA, a nonprofit association of more
than 95,000 IT professionals worldwide, pointed out
in a white paper that organisations with effective data
analytics can make stronger business decisions by
learning what works and what does not, what they are
doing well and where they need improvement. Through
analysis of available information, management can
streamline operations, improve performance and profits
and better identify and manage risks. It can also pinpoint
opportunities for companies to better connect with their
target markets and customers, putting them ahead of
the competition.
“The virtue of analytics is its ability to provide insights
into business forecasting and performance, predicting
trends, identifying risks and refocusing management
strategy to adapt to changing environments. Most clients
know their organisation’s data is full of potential. Stored
and siloed throughout their business, it represents a
wealth of possibilities,” said Phillipps. Business leaders
increasingly overwhelmed by the large volumes of data
are now turning to solutions providers like Deloitte. By
tapping the combination of its deep industry experience
and strong analytics capabilities, Deloitte can translate
everyday information into useful, actionable insights for
these decision-makers.
“In a global analytics marketplace
anticipated to grow to US$50 billion
(S$63.6 billion) by 2015, we are
very pleased to be partnering EDB
in launching the Deloitte Analytics
Institute Asia in Singapore.”
– Tim Phillipps, Global Leader, Deloitte Analytics
The Ideal Environment
DAI Asia represents a key development in Deloitte’s
efforts to enhance its competencies in the analytics
field by concentrating and cultivating regional expertise
and knowledge. Together with its flagship institute in the
United States and a third facility to be set up in London,
DAI Asia supports the training of world-class analytics
professionals and cross-border cooperation to offer
unique analytics-based solutions to Deloitte’s clients.
In selecting the Asia-Pacific headquarters for its think
tank, Deloitte said it was drawn by EDB’s forward-looking
approach to develop Singapore into a hub for advanced
analytics. In line with the shift in focus towards more
knowledge-based, high-end activities, data analytics is
among the new areas identified as being strategically
important to Singapore’s continued economic growth.
In August, EDB’s International Advisory Council also
recommended investing in this niche industry to help
global companies in Singapore tap growth in the
Asia-Pacific region.
“We considered a number of locations in the Asia-Pacific
region to base our Analytics Institute, but we believe that
with such strong government support, Singapore offers
the best opportunity. The decision to base the Institute’s
15 full-time research and training staff here firmly
establishes Singapore as a regional hub for research
and innovation in the analytics industry,” said Phillipps. �
13
Report
Singapore’s chemical
industry gets a boost with
JAC’s aromatics plant
The latest addition to Jurong Island bodes well for the Republic’s reputation as a
leading chemical hub.
Lim Hng Kiang, Minister of Trade and Industry, leads VIPs and representatives of JAC’s stakeholders in breaking ground for the new aromatics complex
on Jurong Island
To maintain its status as a leading chemical hub,
Singapore is constantly working to stay at the forefront
of the industry’s advancement by focusing on the
development of competitive feedstock for petrochemicals,
advanced materials and specialty chemicals. Helping the
chemical industry flourish is Jurong Island, a world-class
chemical hub that is home to some of the world’s largest
petrochemical corporations.
At present, close to 100 companies have established
their presence on the Island, running various facilities.
Jurong Aromatics Corporation (JAC), a joint venture
between eight shareholders, including Singapore’s EDB
14
Investments (EDBI), will be the first tenant of Jurong
Rock Cavern, Singapore’s first underground rock cavern
for hydrocarbon storage. On 26 August, JAC held a
groundbreaking ceremony for the construction of a
US$2.4 billion (S$3 billion) aromatics complex with
dedicated port and shipping facilities and a condensate
splitter on Jurong Island.
A Global Effort
Currently, JAC finds itself in a unique position. It has
already secured an annual US$2.2 billion (S$2.7 billion)
worth of offtake contracts for the next seven years.
The viability of this project, which was delayed due
to the 2008 global financial crisis, is assured as the
international buyers of the complex’s aromatics and
transportation fuels are its stakeholders.
According to Mehdi Adib, CEO, JAC, “Despite being
one of the largest aromatics projects in the world, there
are no oil majors among our shareholders. Instead, our
shareholders include international feedstock suppliers and
petrochemical products offtakers. This gives our business
a coat of insurance even before it’s up and running.”
The project is 30 per cent owned by South Korea’s SK
International Investment and 25 per cent by China-based
Jiangsu Sanfangxiang Group, with Swiss commodities
player, Glencore, taking a 10 per cent stake. The
remaining is divided between Arovin Ltd (10.5 per cent),
Shefford Investments (9.5 per cent), Thai KK Industry
(5.1 per cent), EDB Investments (5 per cent) and India’s
Essar Group (4.9 per cent).
In April, JAC signed a US$1.56 billion (S$1.98 billion)
financing to build the plant, with 11 banks committing to
the debt. About US$1.24 billion (S$1.57 billion), or 80 per
cent of the debt, will be shouldered by two South Korean
government export agencies for a tenure of up to about
15.5 years.
The Rise of Aromatics
Today, the demand for aromatics is steadily increasing,
particularly in markets like China and India, due to a
wide range of end applications. For example, paraxylene
is used in the production of polyester for textile and
Singapore is constantly working
to stay at the forefront of the
industry’s advancement by
focusing on the development
of competitive feedstock for
petrochemicals, advanced materials
and specialty chemicals.
clothing, orthoxylene in PVC and benzene in synthetic
rubber, nylon and plastics.
The JAC aromatics plant will be able to address this
rising demand and will be one of the largest in the world,
once operational in 2014. Its production of aromatics –
hydrocarbons that form the base material for a range of
consumer items used in cosmetics, medicine, transport
and telecommunications – will total 1.5 million tonnes
per annum (tpa), comprising 800,000 tpa paraxylene,
200,000 tpa of orthoxylene and 450,000 tpa of benzene.
“The strong demand for aromatics in Asia is a clear
example of Asia’s growing needs. Asia alone accounts for
more than two-thirds of the global demand for paraxylene,”
said Lim Hng Kiang, Minister for Trade & Industry and
guest-of-honour at the groundbreaking ceremony.
Jurong Island’s Allure
Given the important role aromatics plays in Asia Pacific,
Jurong Island was the perfect choice for JAC’s new
aromatics complex, given its strategic location at the
crossroads between buyers in the Asian markets and
feedstock suppliers in the Middle East and Australia. In
addition, Jurong Island has a number of other
petrochemical facilities, some of which are potential
offtakers. This ensures the availability of an experienced
and skilled workforce and reliable centralised utilities.
“Jurong Island, a world-class chemical hub, not only had
the space for our complex – the island itself is a marvel,
being totally made of reclaimed land. The Singapore
government understood our business and was attuned
to our needs, especially when we were arranging the
financing of this project,” said Adib. He added that
Singapore’s first-rate infrastructure, excellent connectivity
and solid base of industry players and customers
attracted the shareholders to locate the plant here.
Given this vote of confidence, JAC will strengthen the
city-state’s competitiveness as a major petrochemicals
hub in Asia, boosting the export of petrochemical
products from Singapore. Dr Beh Swan Gin, Managing
Director, EDB, said, “We are very pleased to welcome
JAC as a new entrant to Jurong Island. The JAC
aromatics complex reinforces Singapore’s status as a
leading producer of aromatics products to meet growing
demands in Asia. This project also reaffirms Singapore’s
attractiveness as a trusted location for regional and
international energy and chemicals players to forge new
business partnership opportunities.” �
15
Report
Coca-Cola opens new
concentrate plant in Singapore
New concentrate manufacturing plant leverages Singapore’s regional
connectivity and skilled manpower to support The Coca-Cola Company’s
growth in Asia Pacific.
Photo courtesy of Pacific Refreshments
Opening ceremony of Coca-Cola’s concentrate manufacturing plant at Tuas. (Left to right) Fred Yochum, Vice President, Corporate Supply Chain, The
Coca-Cola Company; David Adelman, Ambassador of the United States of America to Singapore; Leo Yip, Chairman, EDB; and Irial Finan, President,
Bottling Investments and Executive Vice President, The Coca-Cola Company
16
The Coca-Cola Company (Coca-Cola) officially opened a
S$72 million (US$60 million) concentrate manufacturing
plant in Singapore on 20 September. The concentrate
plant will support the beverage giant’s continued growth
in Asia Pacific and help achieve the company’s goal of
doubling daily worldwide servings of its beverages in the
next decade.
One of the largest in Asia, the plant has the capacity to
produce 24 million kilograms of concentrate per annum
– equivalent to over 18 billion 330ml cans of Coca-Cola
– and will supply concentrates to markets across Asia
Pacific. These concentrates are used to manufacture
beverages in Coca-Cola’s portfolio, including major
brands such as Coca-Cola, Fanta, Sprite, Powerade and
Minute Maid.
“This (the concentrate plant) is an investment for
growth as Asia is one of our fastest growing markets
and across the region, we see high demand for our
wide range of beverages,” said Irial Finan, President,
Bottling Investments and Executive Vice President, The
Coca-Cola Company, at the plant’s opening ceremony.
He added that Singapore’s skilled manpower,
world-class infrastructure and global connectivity
make it an attractive location for the concentrate
plant. “Locating the plant in Singapore is in line with
Coca-Cola’s strategy of being close to our customers.
We can have a short lead time to our markets, enabling a
flexible supply chain and low carbon footprint,” said Finan.
The world’s largest maker of non-alcoholic drinks has
a long-standing presence in Singapore – its local
operations span 75 years and include a bottling plant
and a regional marketing office. The new concentrate
plant is Coca-Cola’s first in Singapore and broadens its
activity base in the city-state to include manufacturing.
Location, Location, Location
Singapore’s strategic location between East and West
provides consumer packaged goods companies with
effective market access to Asia. Closer proximity to
regional markets enables companies to better capture the
tremendous opportunities fuelled by the growth in Asia’s
middle-class consumers and their spending.
“Companies such as Coca-Cola looking to grow in Asia
need a location that puts them closer to their customers.
This will enable a more flexible supply chain and shorter
lead time to markets,” said Leo Yip, Chairman, Singapore
Economic Development Board (EDB). “Singapore as
a globally connected logistics hub located in the heart
“Locating the plant in Singapore is
in line with Coca-Cola’s strategy of
being close to our customers. We
can have a short lead time to our
markets, enabling a flexible supply
chain and low carbon footprint.”
– Irial Finan, President, Bottling Investments and
Executive Vice President, The Coca-Cola Company
of Asia meets these supply chain management and
logistical needs.”
Yip added that Coca-Cola’s decision to locate its
knowledge-intensive concentrate plant in Singapore
validates the country’s efforts in developing a businessfriendly environment with a robust intellectual property
protection regime.
Deeper Understanding of Regional Markets
To cater to the increasingly sophisticated Asian
consumers, global companies and brands need to
understand the unique needs and preferences of these
Asian consumers. This would enable them to effectively
develop and manage products and services tailored for
the regional markets. Singapore is now building up its
consumer insight capabilities to help companies do so.
One key initiative is the newly established Institute
on Asian Consumer Insight. The S$77 million
(US$64.2 million) institute was set up to conduct
research and education programmes to help firms
innovate brands, products and services that meet the
needs and aspirations of consumers across the region.
“We are committed to strengthening our value proposition
and capabilities… as a centre for brand management
and innovation,” said Yip. “I am confident that Coca-Cola
will continue to find value in our business propositions
and grow in partnership with Singapore.” �
17
Report
Living with green energy
Singapore partners Panasonic for the first total energy solutions public housing
test-bed in Asia.
Kicking off the Panasonic Total Energy Solutions Test-Bed Project in Singapore are (left to right) Haruyuki Ishio, Director, Corporate Division for
Promoting Energy Solution Business, Panasonic Corporation; Chee Hong Tat, Chief Executive, EMA; Tan Choon Shian, Deputy Managing Director,
EDB; Fumio Ohtsubo, President, Panasonic Corporation; Larry Cheng, Deputy Managing Director, Building Research Institute, HDB; Yorihisa Shiokawa,
Managing Director, Panasonic Asia Pacific
The global population continues to grow at an
unprecedented rate and city planners worldwide
continue their search for innovative urban solutions to
maximise resources and improve the quality of life in
cities. Companies in sync with such global trends like
Panasonic are leading the pack in developing energy
management solutions that are sustainable and, more
importantly, applicable for entire buildings, districts and
even cities. In these transformative times, Singapore
is positioning itself as a “living lab” for innovative and
sustainable urban development and smart city projects.
18
In partnership with Singapore’s Housing & Development
Board (HDB), Energy Market Authority (EMA) and
Economic Development Board (EDB), Panasonic is
conducting a first-of-its-kind test-bed of total energy
solutions for public housing in Singapore. The project
will see Panasonic integrate its energy creation, storage
and saving solutions at an existing residential building in
Singapore to realise a more energy efficient future. The
test-bed project will be conducted from this year until
2013 in Punggol Eco Town, one of the key “living labs” for
urban solutions in the Republic.
Ideal Platform for Innovations
New products and solutions often require lead demand
and credible reference projects before there is widespread
adoption. As one of the most highly urbanised cities in the
world, Singapore’s government has shown an appetite
in recent years for innovative urban solutions. With more
than 80 per cent of the population living in HDB housing,
Singapore is the perfect partner for companies like
Panasonic, who are keen to test and demonstrate their
housing energy solutions before scaling up these solutions
for application in other markets around the world.
Moreover, Singapore’s workforce and business culture
offer a conducive environment for companies to try
out cutting-edge solutions. Fumio Ohtsubo, President,
Panasonic Corporation, said, “Singapore, with its excellent
infrastructure and talent base, is an ideal ‘living lab’ to
test-bed our energy solutions. I expect this collaboration
to be a pioneer endeavour towards a greener lifestyle in
Singapore and the region with our technology.”
Designing a Smart City
Panasonic has long been known for its pioneering
efforts to spread full-featured home energy management
solutions to homes around the world. Now, Panasonic is
applying its expertise to Singapore, starting with a block of 100 households in the Punggol 21 housing estate.
Photovoltaic (PV) solar panels on the roof will supply
electricity for lifts, water pumps and lighting in the
common areas, while lithium-ion batteries will store
excess energy to serve as night-time power supply
and a backup electricity generator. This system could
“Singapore, with its excellent
infrastructure and talent base,
is an ideal ‘living lab’ to test-bed
our energy solutions. I expect
this collaboration to be a pioneer
endeavour towards a greener
lifestyle in Singapore and the region
with our technology.”
– Fumio Ohtsubo, President, Panasonic Corporation
potentially produce a building with zero carbon emissions
from its common facilities. In addition, Panasonic will
install its Home Energy Management System (HEMS)
in participating units, featuring in-home displays for
the residents to monitor their electricity, water and gas
usage. This allows households to better manage their
utilities consumption and increase energy efficiency.
The project also presents a great opportunity for EMA
to test-run its Intelligent Energy System (IES) pilot in
collaboration with Panasonic. Announced in November
2009, the IES pilot will test the feasibility of using smart
meters and smart grid technologies for households and
businesses in Singapore to enhance the efficiency and
resilience of Singapore’s power system.
Building to Last
As a small country with limited resources, Singapore
understands the need for optimising the use of
resources to ensure sustainability in the long run.
It is therefore crucial to implement effective energy
management solutions. Due to Singapore’s location in
the tropics, as much as 30 per cent of the electricity
it generates is consumed by air conditioners. By
combining energy-efficient air conditioners with demand
response technologies in all households, Panasonic
executives are optimistic that Singapore could save as
much as 10 per cent of its total energy usage, equivalent
to the capacity of a new power plant.
These initiatives are in line with Singapore’s vision
of the future. For example, HDB has been driving
sustainable development efforts in its towns and
estates for years. HDB towns are planned and designed
to embrace the local climate, using passive design
strategies to achieve effective energy, water and waste
management. This test-bed project therefore presents
the ideal opportunity for Panasonic and HDB to realise
their mutual goals collaboratively.
“This project attests to the ease of private-public
partnerships in Singapore and will help Panasonic
accelerate the commercialisation of its new energy
solutions business, before scaling up for global markets,”
said Tan Choon Shian, Deputy Managing Director, EDB.
As a city level “living lab”, Singapore has laid the
foundation for greater and more collaborations with
companies on innovative urban solutions projects.
Looking ahead, with increasing adoption of innovative
energy solutions in more homes, buildings, stores,
offices and public facilities, Singapore is now one
step closer to becoming a city that truly embraces
sustainable development. �
19
Report
Moulding into a regional hub
Singapore’s dynamic and strategic business environment has contributed to
Borouge’s status as a global powerhouse for innovative plastics solutions.
Awaiting Pic
The new Borouge Innovation Centre will support the Singapore headquarters in marketing and sales in Asia, allowing the company to react faster to
customers’ needs in a rapidly developing region
Petrochemicals play an important role in the modern
world as they are essential for manufacturing diverse
products such as synthetic fibres and rubbers, plastics,
resins and even explosives. Fuelled by rapid urbanisation
and economic development in Asia, the petrochemical
industry has become one of the world’s fastest growing
industries. In Singapore, the energy and chemical
industry accounts for S$60 billion (US$47.1 billion),
or one-third of the country’s manufacturing output,
and multinational corporations (MNCs) like Shell and
ExxonMobil are major contributors.
For its first venture into Asia, Borouge, a leader in
producing innovative, value-creating plastics solutions,
20
was attracted by Singapore’s potential and set up its
global headquarters here in 2007. The Singapore office
is responsible for the company’s sales and marketing
functions, as well as customer service, finance and IT
services in the region. It complements Borouge’s Abu
Dhabi-based production arm, and is supported by sales
offices in cities such as Abu Dhabi, Auckland, Beijing,
Beirut, Guangzhou, Hong Kong, Melbourne, Mumbai
and Shanghai.
A Proven Track Record
Borouge was established in 1998 as a joint venture
between Abu Dhabi National Oil Company, a major oil
and gas company, and Borealis, an Austrian-based
leading provider of chemical and plastics solutions. In
recent years, Asia has become a long-term market for
the majority of Borouge’s value-added polyolefins –
organic thermoplastic polymers used in consumer goods,
structural plastics, food packaging and industrial products.
Borouge’s key considerations for its headquarters
included regional connectivity to quickly build the
company’s sales and marketing functions and good
infrastructure to support the office’s multiple functions.
Singapore stood out as the company’s top choice with
its positive track record as a strategic location for MNCs
servicing the Asian and Indian sub-continents. Borouge
says Singapore’s appeal lies in several factors, including:
A business-friendly environment
To forge a conducive environment for businesses to
thrive, Singapore has maintained its government’s
transparency while creating a strong legal system and
effective pro-business schemes. The stable political
climate and efficient judicial system helped Borouge
take root and conduct its business activities with peace
of mind.
A competent workforce
Borouge has been able to recruit many capable
employees from Singapore’s pool of highly educated and
efficient workforce in the petrochemical industry. These
local talents possess the right skill sets and experience
to fill key positions across both commercial and
administrative functions, which have been instrumental in
helping Borouge grow its business.
By tapping Singapore’s connectivity
to key markets, Borouge has been
able to efficiently coordinate with
its 10 sales offices around Asia
through its global headquarters,
thus creating a comprehensive
network to facilitate its sales and
marketing functions.
World-class infrastructure Singapore’s comprehensive port network and road
systems have allowed Borouge to reach out to more
customers and markets, thereby gaining a strong foothold
in Asia. The city-state’s logistics infrastructure has also
been a boon to Borouge’s growth. In 2010, Borouge
tripled its annual production capacity in Abu Dhabi to
two million tonnes. Singapore was able to consolidate
Borouge’s logistical activities within the country through
CWT, a privately owned enterprise that provides
integrated logistical and regional distribution services for
MNCs in Asia Pacific. The CWT Commodity Hub, which
opened in May 2010, now handles up to 330,000 tonnes
of value-added polyolefins per year for Borouge, thus
reinforcing Borouge’s growing scope of business.
Expanding to New Horizons
Since Borouge established its base in Singapore,
both the company and the country have benefited
tremendously from the partnership. Relocating the
position of Borouge’s Marketing & Sales CEO to the
Singapore office helped build a strong sales and
marketing presence from the top down in the region. By
tapping Singapore’s connectivity to key markets, Borouge
has been able to efficiently coordinate with its 10 sales
offices around Asia through its global headquarters, thus
creating a comprehensive network to facilitate its sales
and marketing functions.
Borouge’s Innovation Centre is due for completion at the
end of 2011 and is expected to increase the company’s
plastics production capacity to four million tonnes by
2014. Singapore’s logistical superiority and connectivity
will play a key role in consolidating Borouge’s future
productions and the city-state will be the ideal nerve
centre for the company’s regional sales operations.
Borouge’s presence in Singapore underscores the
significance of the country as an effective regional
petrochemicals hub. It strengthens the impression of
Singapore as a viable start-up location for petrochemical
companies that are seeking to establish their presence
in Asia. As Borouge continues to expand its operations,
Singapore’s reputation as a logistical hub will be further
solidified. With all the opportunities to collaborate in
the future, Borouge’s partnership with Singapore will
cement both parties as major players in the global
petrochemical industry. �
21
Special
Future Ready Today_
This special series of articles discusses what tomorrow’s challenges mean for
today’s businesses. In this issue, we look at how Asia is flourishing as the new
centre for the arts amid rapid economic growth and Singapore’s efforts to position
itself as a hub for the visual arts industry.
The Singapore Art Museum is home to one of the largest collections of modern and contemporary Southeast Asian artwork
A pro-business, forward-looking approach has not
only put Singapore on business maps everywhere, it
has nurtured a profound understanding of what global
companies need in today’s world.
With the business environment changing at an
unprecedented pace, Future Ready Today_ articles
explore the possible avenues that businesses in different
industries can leverage on and are supplemented with
real-world examples of how some of the world’s leading
companies have made the most out of their partnerships
with Singapore.
22
In the fourth of a series of Future Ready Today_ articles,
we examine how the art world’s centre of gravity is
moving eastwards as Asia’s metropolises rapidly develop
into hubs for the visual arts industry, thanks to the
region’s sustained economic boom.
For more interesting Future Ready Today_ articles,
visit www.singaporebusiness.com
Mention “art” and the cities that spring to mind as popular
centres for the arts and artists are likely London, New
York and Paris. There are myriad factors that contribute
to a flourishing arts scene, but the bottom line is that it
requires the support of affluent consumers.
Asia’s increasing prosperity mirrors the rise of Asian
interest in art. Having weathered the global financial
crisis better than any other region, Asia is experiencing
unprecedented economic growth. According to The
Business Times, there are now as many high net worth
individuals (HNWI) – defined as having US$1 million
(S$1.3 million) or more in assets – in Asia as in Europe.
By 2013, the number of Asian HNWIs will exceed even
the US. Unlike their Western counterparts, Asia’s HNWIs
tend to spend their wealth in the region. Consequently,
the level of disposable income in Asia is higher than the
global average: In 2008 and 2009, cash holdings of Asian
HNWIs as a percentage of total wealth was 29 per cent
and 22 per cent respectively, compared to the global
average of 17 per cent.
Facts on the Ground
Asia’s greater economic clout has led to a huge potential
for consumption. This is spurring the influx of different
players in the arts scene into Asia, providing a new point
of growth for the industry. With bread-and-butter issues
out of the way and extra cash in their pockets, Asian
consumers are showing greater appreciation for luxury
goods and pursuits such as gourmet food, fine wine and
fashion. A growing group of sophisticated, globalised
Asians are also seeking out opportunities to invest in items
perceived to have tangible, long-term value.
Simultaneously, global appreciation of Asian arts
is quickly developing and players in the visual arts
scene are gaining strength, as evidenced by the rapid
emergence of Asian artists and high turnover for
art auction sales. Nearly half of the world’s top 500
contemporary artists are from Asia, as are half of the
top 10 countries (in terms of turnover) that conduct
contemporary art auctions. Leading the way are China
and Singapore, ranked third and fifth respectively.
While China is focusing on Chinese art, Singapore has
adopted a more cosmopolitan outlook and its strength
lies in regional art, especially from Southeast Asia.
This stems from its geographical location and history
as the hub for Asia Pacific’s marine trade. “Singapore is
strategically located between the growing art markets
of China and East Asia, and India and the Middle East,”
noted Andy Foster, International Managing Director of
auction house Christie’s.
Additionally, Singapore’s success as an arts hub is
rooted in the favourable conditions it offers that attract
Asian HNWIs who are interested in acquiring art for
enjoyment or investment. These include a safe and stable
environment with high standards of living, required
infrastructure, facilities and transport links and supporting
business framework.
Flourishing in Partnership
Besides patronage by well-heeled consumers, an entire
ecosystem of different businesses has to develop for
visual arts to thrive. Artists and prospective art buyers
require a physical space to display, view and purchase
art pieces. Art storage and transportation represents
a logistical challenge, while a favourable tax regime is
important for artists and purchasers. The emergence of
art critics, consultants and technical experts also help
support and sustain the industry’s organic growth.
The Visual Arts Ecosystem:
•Galleries and museums offer exhibition space and outreach programmes to educate the public
•Art fairs act as marketplaces for all parties to
make deals
•Teaching institutions groom future talents
and administrators
•Auction houses value art pieces, set benchmarks and
aid in the trading of art
•Specialised logistics makes sure art pieces are properly
transported door to door
• Specialised storage facilities ensure that valuable art is
kept secure in controlled environments
Establishing a complete set of system requirements
catering to the needs of the various industry players
creates ease of entry into the growing market for them
to leverage the opportunities in Asia. These different
components not only make the business side of visual
arts seamless, but also perpetuate appreciation and
demand for art locally, while attracting overseas art
enthusiasts.
The Singapore Difference
Singapore’s museums have made a name for themselves
in the region. The Singapore Art Museum, for example,
has amassed one of the world’s largest public collections
of modern and contemporary Southeast Asian artwork
since it opened in 1996. Meanwhile, gallery owners in
Singapore having to travel frequently to discover and
nurture deserving artists and help promote their works
are benefiting from the city-state’s sound infrastructure
and global connectivity.
23
Special
However, galleries in Singapore face a further challenge
with limited exhibition space available. To counter this
problem, Singapore aims to open the National Art Gallery
in 2014, focusing on Southeast Asian art from the 19th
century to the present. When completed, it will offer more
exhibition space than the National Gallery in London.
Such a proactive approach to support the development
of the arts spurred Lorenzo Rudolf, former director of Art
Basel, to select Singapore as the location of his art fair
for Asia. “Many cities want to be world-class but they only
pay lip service. This city is different,” he said.
In January 2011, the inaugural Art Stage Singapore was
held at Marina Bay Sands with Rudolf at the helm as the
fair’s director and CEO. More than 120 contemporary
and modern art galleries from 26 countries participated,
offering a complementary blend of Asia-Pacific art and
creations from Western art galleries. Notable figures
from the art world, including American photo artist David
LaChapelle and contemporary artist Takashi Murakami
from Japan, graced the event, which welcomed over
32,000 visitors and generated strong sales. “Asia is
ready for an international event like Art Stage Singapore,”
said Rudolf.
Apart from paving the way for prestigious arts events to
be held in Singapore, the government is also supporting
the development of local talents and infrastructure.
In his budget speech in February, Finance Minister
Tharman Shanmugaratnam announced that S$365
million (US$286.8 million) will be set aside annually for
Asia’s greater economic clout has led
to a huge potential for consumption.
This is spurring the influx of different
players in the arts scene into Asia,
providing a new point of growth for
the industry.
arts practitioners up to 2015, marking an increase of over
50 per cent for such funding. In a separate investment,
the government is also turning the laidback enclave of
Gillman Barracks into an arts and creative hub.
Meanwhile, government support has been instrumental
in the development of The Singapore Freeport (Freeport),
a massive state-of-the-art facility for storing art and other
collectibles located near Changi Airport. The first of its
kind in Asia, Freeport is an example of the ability of
Singapore’s logistics sector. The size of six football fields,
it contains secure vaults, private viewing rooms and
exhibition space, all with temperature and humidity
controls. “Singapore is a stable location, and the
government is committed to promoting and supporting
the arts. These factors are a huge draw for collectors,”
said Alain Vandenborre, President and Co-founder,
Freeport. Collectors will also be allowed to exhibit works
stored in Freeport in Singapore museums without having
to pay taxes or submit custom forms.
New Blood
Another important component in the visual arts
ecosystem is the education institutions that continuously
produce graduates to fill positions in the industry.
Singapore offers a comprehensive array of institutions
such as Nanyang Academy of Fine Arts and LASALLE
College of the Arts that provide myriad courses for young
people interested in the arts, from pre-tertiary to diploma
and degree levels.
The training and exposure these arts graduates receive
mean they can influence the local community to be more
appreciative of art, regardless of their eventual profession.
An Australian study also demonstrated the positive impact
of art education on areas such as economic growth,
communication skills and knowledge acquisition.
As the centre of gravity in the world of the arts shifts
inexorably towards Asia, Singapore is well-positioned to
become a regional hub for the industry.
“A forward-thinking and thriving arts community, aided
by the ease of movement, all go towards encouraging
more artists, auction houses and collectors to flock to
Singapore,” said Quek Chin Yeow, Deputy Chairman for
Asia, Sotheby’s. Confirming that Singapore is on the
right path, Fumio Nanjo, Artistic Director of Singapore
Biennale 2006 and 2008, added, “Singapore is
increasing depth not only by building the arts, but also
the galleries, museums, colleges and businesses that
support the industry.” �
To comment and share your thoughts on this issue, visit
www.singaporebusiness.com
24
About the Singapore Economic
Development Board
The Singapore Economic Development Board (EDB) is
the lead government agency for planning and
executing strategies to enhance Singapore’s position
as a global business centre. We dream, design and
deliver solutions that create value for investors and
companies in Singapore. Our mission is to create for
Singapore, sustainable economic growth with vibrant
business and good job opportunities.
For more information on how EDB can help your
business, please visit www.sedb.com/news
What is Singapore: Future Ready?
Singapore: Future Ready articulates Singapore’s aspirations to be a partner for global businesses as they develop
their ideas for tomorrow’s solutions. We do so by recognising the value of long term relationships, adopting a
forward-looking approach, demonstrating ingenuity and taking on challenges with a can-do spirit.
This is the final printed issue for Singapore Investment News. Look forward to a revamped online publication,
Singapore Business News_, which will be released monthly from January 2012. Stay updated with Future Ready
Singapore content, economic news and industry highlights.
Sign up for our e-newsletter at http://www.edb.gov.sg > “Quick Links” > “Subscribe for e-newsletter” or
http://www.edb.gov.sg/edb/sg/en_uk/index/registration.html, where you will be able to download the
online publication monthly.
Publishing Consultant: Paperclip Communications Pte Ltd
Publication Team
Editors:
Ho Yong Min ([email protected])
Mok Cher Soon ([email protected])
Editorial Contributor:
Joyce Ong ([email protected])
Art Director:
Vincent Tanara ([email protected])
Project Manager:
Khim Yap ([email protected])
Please email your comments/feedback to: [email protected]
This material is circulated by the Singapore Economic Development
Board, 55 East 59th Street, New York, NY 10022, which is registered
under the Foreign Agents Registration Acts as an agent of the
Government of the Republic of Singapore. This material is filed with
the Department of Justice where the required registration statement is
available for public inspection. Registration does not indicate approval
of the contents of this material by the United States Government.
© Singapore Economic Development Board.
All information correct at time of printing
Singapore Economic Development Board
250 North Bridge Road
#28-00 Raffles City Tower
Singapore 179101
Tel 65 6832 6832
Fax 65 6832 6565
www.sedb.com