Opening Speech by Guest-of-Honour, Mr S. Iswaran - Singapore ...

OPENING SPEECH BY MR S ISWARANMINISTER, PRIME MINISTER’S OFFICE,SECOND MINISTER, HOME AFFAIRS AND TRADE & INDUSTRYAT THE TOURISM INDUSTRY CONFERENCE 2013MONDAY, 22 APRIL 2013, 3PM, MARINA BAY SANDS“AT THE CROSSROADS OF OPPORTUNITY AND GROWTH”Chairman Mr Chew Choon Seng and members of the Singapore Tourism BoardPartners and friends from the tourism industryDistinguished GuestsLadies and gentlemenGood afternoon1. It is my pleasure to join all of you at this year’s edition of the Tourism IndustryConference. Over the past five years or so, I have witnessed the steady evolution ofthis Conference where it has become a significant event in the local tourism industrycalendar. It is not just a networking activity but also an occasion for the diversestakeholders in the tourism industry to collectively reflect on the state of the industry,and some of the trends and developments that have a material impact on the waythe industry will be influenced moving forward.2. Looking back, much has transpired in Singapore’s tourism scene in the lastfive years. In 2008, there is the hosting of the world’s first Formula 1 night race inSingapore. In 2009, we were in the depths of the global financial crisis. But therebound was swift in 2010, and that was further catalysed by the advent of theIntegrated Resorts as well as other attractions and new facilities in our tourismlandscape, With the rise of the Asian travellers, we have experienced unprecedentedrates of growth in visitor arrivals and tourism revenue. It certainly has been aneventful period for our tourism industry.Tourism Industry at a Crossroads1

3. The path that lies ahead of us is equally promising, and also no lesschallenging. It is timely and imperative that we take stock of our current and futureoperating environments and consider possible growth trajectories for the industry.4. Externally, the growth opportunities in the tourism industry are clearly in Asia.The UN World Tourism Organisation expects Asia to lead the growth in globaltourism arrivals at 5-6 per cent for 2013 compared to the global average of 3-4 percent. The World Travel and Tourism Council expects Asia to do the same over thenext decade on the back of rising wealth among its middle classes. This presents aclear window of opportunity for Singapore to attract discerning travellers who seekout and are willing to pay a premium for differentiated experiences.5. Domestically, we have made some important investments in tourism assetswith their intended programming content. These include the Marina Bay CruiseCentre, Gardens by the Bay, Sports Hub, Gillman Barracks and the Mandai naturecluster, just to name a few. Our events calendar is ever more colourful as well. Wealso have a nimble, adaptable Singaporean workforce that has helped us to sharpenour edge as a premier tourist destination.Making Tough Choices for Quality Growth6. But, this window of opportunity will not remain open indefinitely. Theopportunity for us is in a finite timeframe and is one that we must move toseize. Many industry leaders have observed and shared with me that they arealready feeling the impact of keen regional competition for the same tourism pie, andthis cuts across various verticals of the tourism sector. This challenge isaccentuated by our internal labour constraints. This means that the recent stronggrowth in visitor arrivals is not sustainable. In other words, the growth model that isbased solely on sheer quantitative growth is no longer viable. At this juncture ofour growth, we need to agree collectively and move decisively, as an industryand as individual businesses, towards quality yield-driven tourism andconsequently devise and execute the strategies that will take us towards thatgoal.2

7. The Singapore Tourism Board (STB) and the Ministry of Trade and Industryhave been meeting various industry groups to exchange ideas in order to chart ashared path forward. There is a general consensus that we need to repositionourselves for more sustainable quality growth, of which the focus is on deriving yieldfrom each visitor to Singapore. There is also broad agreement that even as we bringin new ideas and concepts from abroad, we must also focus our energy on creatingour own distinctive content and programming that will continue to differentiateSingapore and set us apart from our regional competition. There is also the questionof how we can help our workers acquire new capabilities, enhance their productivityand take on higher value jobs that support the industry’s and your own companies’growth.8. These are fundamental issues that challenge and will continue tochallenge the way we do things now. They will entail choices that will bedifficult at times and they require an ongoing conversation between the publicand the private sectors so that we can converge and decide on the best pathforward. I am therefore very glad that STB is facilitating this conversation andframing the key issues in the discussion paper for this conference.Growth Opportunities in Tourism Software9. One area with clear opportunities for sustainable high value growth is in thecreation of programming and content, or “software”, especially in lifestyle offeringsand business events. STB is keen to partner you to explore such opportunities, likein the Singapore Pinacotheque de Paris project. STB and NParks are exploring withthe Art Heritage Singapore consortium the possibility of customising the existing FortCanning Centre and Black Box “hardware” into a purpose-built museum with modernart from outstanding private collections, curated for an Asian audience. These arestill early days for the project, as the stakeholders are undertaking constructionfeasibility studies before proceeding. However, if it takes off, it will be a first forSingapore and the region, and will help catalyse our arts tourism landscapealongside existing strong offerings like Art Stage Singapore and Art Week. Moreimportantly, it is an example of how public-private collaboration can occur in practicein order to curate new ideas and tourism offerings.3

10. As a global-Asia economic hub, we are also in a good position to deliverglobally-relevant business event content, especially for strategic industry clustersthat Singapore is seeking to build a competitive advantage. STB is thus giving evengreater emphasis to business event programming, as strong content will buildgreater mindshare for Singapore and drive MICE spend in these domains. Forexample, in the sustainable development space, STB partnered the WasteManagement and Recycling Association of Singapore, NEA and Singex Ventures tointroduce the WasteMET Asia exhibition and Clean Enviro Summit Singapore lastyear. Together with the World Cities Summit and the Singapore International WaterWeek, Singapore attracted a total of 8,000 buyers, 19,000 global leaders anddelegates from 70 countries in 2012. This is a testament to the thought leadershiprole in urban solutions that Singapore plays on the regional stage and our ability toleverage on that to create compelling tourism content.11. These are just some examples of how we can work together to innovate andunlock more growth opportunities. There is significant scope for more innovation andwe are keen to work with you to explore these. Not just large-scale offerings like theones I have described, but also smaller scale innovations which we hope to seedthrough STB’s new Kickstart Fund. With an initial budget of $5 million and access tobusiness advice from experienced hands in the industry, STB is keen to work withyou to catalyse the development of compelling lifestyle concepts with strong tourismpotential, adding to the software that will enliven our city.Making Growth Count for Singaporeans12. If we shift towards yield-driven growth and more software-intensiveactivities, STB estimates that we can bring in 4-6 per cent more tourismreceipts (TR) on an annual compounded basis over the next decade. Visitorarrivals in the meantime should moderate to 3-4 per cent CAGR over the sameperiod. This is quality growth that is sustainable.13. We need companies to partner us in translating such growth into morediverse and higher value job opportunities for Singaporeans. Capability4

upgrading and productivity enhancements will be central to such efforts. STB willsupport you through targeted programmes that facilitate more flexible deployment ofworkers across job functions, technology adoption and business processenhancements. These, coupled with broad-based assistance like the Wage CreditScheme, will help our companies thrive and improve the career progression andwage growth prospects of Singaporeans.14. Some industry players have already embarked on this effort to raise theircapabilities and productivity. Park Hotel Group is an example who has successfullypiloted a job-redesign scheme to enhance the value of its jobs and the group’soperational performance. Through this “Hotel Operations Specialist Team” (HOST)scheme, Park Hotel trains and cross-deploys its staff across core functions withineach property like the front office, housekeeping and F&B. The hotels are able tooptimise their limited manpower during peak periods, and the cross-trainedspecialists enjoy higher wages 1 as a result of the expansion in job scope – mutuallybeneficial outcome for both company and workers that we can all aspire to.15. STB is also committed to helping industries grow their top-line by exploringnew, higher value business opportunities and business models. The advanced skillsthat we are equipping Singaporeans with should help position companies tocapitalise on such growth. Chief Executive of STB, Lionel will elaborate on thespecific programmes which STB is implementing under the second tranche of theTourism Development Fund totalling $905 million, and how we are already beginningto see changes on the ground.Conclusion16. So ladies and gentlemen, certainly there are hard choices to be made, butequally, there are also good growth opportunities to be had if we make a determinedand concerted effort to make the necessary changes and move up the value chain. Iwant to assure you that we do not underestimate the difficulties that we might face inthis endeavour, but I am convinced that all of us will find the journey and outcomes1 Up to 50% more per month.5

worthwhile and rewarding, as we try new ideas in content creation, drivingproductivity and working towards upgrading our workforce in order to deliver newand differentiated solutions in the tourism space.17. On this note, let me wish everyone a productive time at this conference and Iwant to thank you for inviting me.6