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Interview

Michael Chia, Chairman, Singapore Maritime Foundation

Michael Chia, Chairman of Singapore Maritime Foundation (SMF), describes the organization’s role in linking the public and private sectors in Singapore’s maritime industry, and how such open dialogue and mutual cooperation can help Singapore achieve its vision of becoming an International Maritime Center 

As an organization linking the public and private sectors in the maritime industry, how has the SMF’s vision of creating Singapore as an International Maritime Center (IMC) evolved or changed since the establishment of the organization in 2004?

The mission of the SMF has remained the same since we started in 2004. We are private sector-led, with a Board of Directors comprising largely of senior executives from the maritime industry. Our objectives are to provide a forum in the private sector for exchanging, generating and developing ideas and proposals to turn Singapore into an IMC, to act as the catalyst in fostering mutual co-operation among various sectors of the maritime industry, and to serve as the government’s partner from the private sector in promoting Singapore as an IMC and developing manpower to support the maritime industry.

Given the breadth of the maritime industry, we typically define the maritime industry as one composed of four core sectors; the port, shipping, offshore and marine engineering as well as the supporting ancillary services. We have found that although these are all integral parts of so-called ‘Singapore Inc’, these four segments have to some degree been operating independently of each other. We wanted to bring these different but interrelated players together to realize potential synergies and reach the critical mass for Maritime Singapore to gain the government and people’s attention in Singapore. If these units are left on their own, we will probably not have the combined strength we enjoy now in reaching our objectives, establishing Singapore as a leading IMC and attracting talent. This was a key impetus behind the establishment of the SMF.

With that as the background, the SMF pursues various initiatives that are aligned with the Maritime and Port Authority of Singapore’s (MPA) objective of developing Singapore as an IMC. It is interesting to note that although the definition of an IMC may vary around the world, there are not many IMCs in the world. For instance, London is undoubtedly an IMC on the service side but it lacks the ‘hardware’ aspect, as is the case with New York. Oslo is another example of an IMC. For Singapore, we want to develop our maritime industry as a recognized IMC and the MPA has worked diligently towards that goal in terms of attracting various maritime players, especially in the shipping sector.

London has indeed evolved from a ‘hardware’ to a ‘software’ or ‘paper’ focused IMC. It is known that Singapore has for a long time had a maritime heritage which was used as a growth platform for other industry sectors. However, where is the local industry headed over the long term?

Singapore has leveraged on its geographical positioning at the crossroads between East and West. Our strategic position along the trade routes has contributed towards our success so far and will always continue to position Singapore as an important intersection along global trade routes. In this regard, Singapore will maintain itself as both a shipping hub and a port city; we try to leverage on our strength as a trans-shipment port. Combined with the fact that Singapore is also a world leader in rig building and FPSO conversions, Singapore is very much a formidable contender on the hardware side and we fully intend to continue along that path.

In addition to this, we have made significant leaps in terms of technological capabilities through focused R&D initiatives. These efforts have enabled Singapore to produce its own marine and offshore structures and designs, carving out its own niche positions in the market place. As a small island-state swimming amongst the icebergs, this allows us to avoid having to compete with the Korean or Chinese giants. This is supported by a lot of encouragement from various authorities in terms of building up competencies, talent development and R&D initiatives.

On the other hand, there has been an increasing focus on developing Singapore’s positioning on the ‘paper’, or maritime services, side. After all, the marine and offshore yards, the shipping and port players, are the bigger players and comparatively more established. In contrast, as a relatively newer entrant to the Singapore maritime industry landscape, the ancillary service providers would benefit from more support. Hence, we do try and devote more attention to promoting and developing this sector. For instance, SMF was involved in efforts that culminated in Singapore being designated by the Baltic and International Maritime Council (BIMCO) as the third named seat for maritime arbitration in BIMCO’s Standard Shipping Forms. This is quite a feather in our hat and demonstrates that Singapore has grown into a critical node in the global maritime network.

The promotion of the maritime industry to the younger generations and the development of the local talent pool are central to securing the industry’s future. What role is the SMF playing in this regard?

In order to promote Singapore as a leading IMC, it is important that we also develop and attract the talents of tomorrow who will take the industry forward well into the future. To that end, we are beating our drums and profiling the maritime industry so that the young people know about our exciting and multi-faceted industry. The industry requires different types of talents and skills and the work is very enjoyable and challenging so why not join us?

That is why we started the Maritime Outreach Network, or MaritimeONE, which serves as a key platform for maritime stakeholders to collectively raise the awareness of the maritime industry and attract quality manpower into the industry. SMF works in conjunction with the other MaritimeONE partners: the Singapore Shipping Association (SSA), the Association of Singapore Marine Industries (ASMI) and the MPA. We also have the MaritimeONE Scholarship Program, which reaches out to young people. Companies in the maritime industry sponsor the scholarships whilst SMF administers it. It is a good collective effort to raise the profile of the maritime industry.

Considering that many in the younger generation look towards the business and technology industries for professional development, we seek to draw their attention back to the maritime industry, which has a long heritage in Singapore’s history. One advantage we have in this respect is that the maritime industry offers a wide range of business-related roles, be it banking, finance or law, for instance.

Over the past few years, we have seen the number of MaritimeONE Scholarships rise, along with the number of maritime-related graduates. This signals that our efforts are indeed bearing fruit and that the younger generation is gaining interest in the maritime industry.

Singapore’s PM Lee Hsien Loong confirmed plans in mid-2013 to relocate container terminals to the industrial hub of Tuas over the medium term due to land constraints. How can the lack of land space interfere, or help, with Singapore’s ambitions to be a maritime hub?

Indeed, Singapore is an island-state known for its constrained land area. We adapt and we do our best to manage with the resources we have. This is reflected in the highly compact but productive shipyards. Singapore businesses have learned to be efficient and innovative.

In working with our constraints, it is only natural that some of the lower end value added activities have to be relocated elsewhere to free up space for the natural progression of our industries and businesses, particularly the higher value added ones. This has occurred in every developed country so far and if we do not do the same, then we would not be progressing. In sum, the fact that we have to manage such constrains makes us sharper and encourages us to closely assess the best way from which we can derive the greatest value from our limited and precious resources. This applies both to land and human capital and that is why we have to attract the best resources.

As the global shipping industry went into decline following the crisis and the price of oil increased, investments flowed from shipping to offshore sectors. To what extent was this phenomenon reflected in Singapore?

Singapore’s offshore industry was born out of the country’s heritage in the marine and ship repair industry. We then gradually evolved our competencies in ship conversions and rig building in the 1970s, with the progressive emergence of the offshore industry. To some extent, this reflects Singapore’s ability and capacity to respond to the marine and offshore industry’s constantly evolving market dynamics. Each time there was a shift in the market, Singapore was quick to respond to that. For instance, in the offshore industry’s latest upturn, Singapore was the first mover right off the bat to secure a slew of rig orders.

This illustrates Singapore’s long-term orientation and our commitment to investing in and developing our processes, human capital and competencies. This also holds true in down times and that is how we survive. This prepares us to be ready to seize opportunities when they present themselves. This is why we are highly committed to investing in human capital because it is the most important asset to have.

Like Singapore, Norway also shares a maritime heritage. To what extent does Singapore work with its Northern European counterparts to advance its positioning?

Norway has, for a long time, been a close partner of Maritime Singapore. For instance, some of our local universities have partnerships with Norwegian organizations and institutions. In fact, one of our major efforts at the SMF is to bring Singaporean companies to the biennial Nor-Shipping event in Norway. Norway holds a special position in the maritime industry and introduces a great deal of technology to our industry. As both entrepreneurs and incubators of technological innovations, Norwegians are very much the ‘techno-preneurs’ of our industry and this is something we are trying to encourage in Singapore.

With that backdrop, it is our ambition to develop Singapore as a knowledge base in the maritime industry. We intend to shape Singapore as the center for expertise in the various maritime domains where people can exchange ideas and conduct cutting edge R&D.

As Chairman of the SMF, which is approaching its ten-year anniversary, what are the hot topics you will seek to address and what are the priorities on your agenda?

Going forward, we will continue to focus on manpower development-related initiatives to meet the needs of Singapore’s growing IMC. We also have plans in the pipeline to further profile Maritime Singapore. At the end of the day, we must continue working towards our vision to be the private sector champion in Singapore’s efforts to develop itself as an International Maritime Centre (IMC). Otherwise we risk losing the traction we have gained so far.

To read more interviews and articles on Singapore, and to download the latest free report on the country, click here.

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