MFA Press Release: Speech by Senior Parliamentary Secretary for Foreign Affairs and Community Development, Youth and Sports Mr Sam Tan at the Opening Session of the Asean Awareness Forum organised by the Ministry Of Foreign Affairs of Italy, 22 March 2012, Rome, Italy

Your Excellency Ambassador Maurizio Melani, Director-General for Country Promotion

Your Excellency Mr Surin Pitsuwan, ASEAN Secretary General

Colleagues from ASEAN countries

Leaders from the Italian business community and International Financial Institutions

Excellencies

Ladies and Gentlemen

1.First of all, on behalf of the Minister for Foreign Affairs of Singapore Mr K Shanmugam, I would like to congratulate the Italian Ministry of Foreign Affairs for this important and timely initiative. I would also like to thank His Excellency Mr Giulio Terzi and his Ministry for inviting Singapore to be a part of the ASEAN Awareness Forum.

2.I am very pleased indeed to be back in this beautiful city of Rome for the third time. As the Eternal City, Rome never ceases to enchant and inspire. It provides the perfect setting for Italian and ASEAN government and business representatives, as well as relevant international organisations, to come together to prospect new ways to strengthen economic links between Italy and the ASEAN region.

Singapore-Italy Economic Relations

3.Singapore is delighted to see Italy paying greater attention to the Southeast Asian region. Italy has a longstanding and close friendship with ASEAN and Singapore, underpinned by a common global outlook and strong economic linkages. Last year, Italy was Singapore’s 6th largest trading partner amongst the European Union countries, and our 25th largest trading partner worldwide. Our total bilateral trade amounted to €3.5 billion, a significant increase of almost 20% from 2010. More than 300 Italian companies are registered in Singapore, including big names such as ST Microelectronics, Rainbow and Saipem. Similarly, Singapore companies find Italy an attractive investment location, particularly in the manufacturing and financial services sectors.

4.The regular contacts between our leaders and government agencies attest to the highly-diversified partnership between Singapore and Italy that cover many fields, ranging from politics, economics, defence, culture, and science and technology. Just barely three weeks ago, Singapore was privileged to play host to an official visit by Foreign Minister Giulio Terzi, during which he signed the second Executive Programme of the Cultural, Scientific and Technological Agreement between Singapore and Italy with our Foreign Minister Mr K Shanmugam.

Economic Opportunities in Singapore and ASEAN

5.As a small and open economy, Singapore strongly supports Italy’s initiative to deepen its economic linkages with Singapore and the wider ASEAN region. Singapore has always adopted a pro-free trade and pro-investment stance, in order to create robust growth and economic opportunities for Singaporeans and our international counterparts. Foreign businesses and financial institutions in Singapore enjoy political and economic stability, strong rule of law, a highly skilled workforce and accessibility to world-class infrastructure. In Singapore, we always try ways and means to make complex procedures simpler. For example, many of the businessmen present would be pleased to know that it takes less than a day to register a company in Singapore, and you may start operations straight away. This is because we have started an eGovernment system through which all government agencies are connected.

6.As mentioned repeatedly by my colleagues, ASEAN is a thriving region with a total population of 600 million and a combined GDP of US$1.8 trillion. It is characterised by rising purchasing power, a growing middle class, and a high savings rate. Together with China and India, the region is becoming an increasingly important growth market for companies around the world.

7.As we know, Asia has emerged as a key engine of growth for the global economy. Asia has consistently tracked a positive growth trajectory in recent years. With the advantage of a low starting base, a youthful workforce and strong demand for exports from emerging markets in both Asia and other regions, Asia is expected to enjoy reasonably strong economic growth over the next few decades.

8.We in ASEAN are well-placed to ride the Asian growth. ASEAN’s trade with China and India has accelerated in recent years, consistently growing by strong double digit percentages between 2003 and 2009. For example, in 2009, our trade with China, Japan and India amounted to US$178 billion, US$161 billion and US$39 billion respectively. At the same time, the US and the EU continue to be major economic partners for ASEAN, with total trade amounting to US$150 billion and US$172 billion respectively in 2009.

9.All this bodes well for ASEAN. We are at the heart of a dynamic region, and the prospect for growth is very, very promising.

ASEAN Economic Community and ASEAN Connectivity

10.ASEAN has set for itself the goal to establish an ASEAN Economic Community by 2015. The mission is to develop a single market and production base that is stable, prosperous, highly competitive and economically integrated. In this community, we hope to see free movement of goods, services, investment, skilled labour and freer flow of capital.

11.To help us realise this objective, ASEAN has adopted the Master Plan on ASEAN Connectivity, which aims to integrate the ASEAN region by extending transport and communications infrastructure including by rail, road, sea and air, as well as through cyberspace, and forging greater institutional and people-to-people linkages.

12.Currently, there are 15 priority projects under the Master Plan on ASEAN Connectivity. Key among these are the Singapore-Kunming Rail Link, the ASEAN Highway Network, the ASEAN Broadband Corridor, and projects to improve connections between mainland and archipelagic Southeast Asia. When completed, the Singapore-Kunming Rail Link, for example, will result in seamless rail access through Singapore, Myanmar, Cambodia, Lao PDR, Malaysia, Vietnam and China. So, as you can see, there will be free flow of communication all the way from China to Singapore.

13.Beyond physical infrastructure, the ASEAN Connectivity Master Plan will also advance institutional connectivity within ASEAN. The enhanced harmonisation and complementarities of the institutional processes of the ten ASEAN countries - for example by harmonising customs procedures and having mutual recognition agreements in areas like technical standards - will bring companies substantial savings of time and money when they do business in the ASEAN region.

14.The realisation of the ASEAN Connectivity Master Plan will enable ASEAN to more fully realise the benefits and potential of ASEAN’s existing network of Free Trade Agreements with its major trade partners. A better connected ASEAN, where capital, goods, people and ideas flow freely, will enhance the region’s economic competitiveness. More business opportunities and activities will help narrow the development gap within the region. Thus, in the longer run, ASEAN Connectivity will not only bring ASEAN countries closer together, but also strengthen ASEAN’s linkages with partners in the broader Asia-Pacific region.

15.To implement the ASEAN Connectivity Master Plan. ASEAN launched a US$500 million ASEAN Infrastructure Fund in September 2011. This aims to enhance regional economic integration and catalyse private sector financing for infrastructure projects. As a sign of our commitment, the ASEAN Infrastructure Fund’s total lending commitment through to 2020 will be about US$4 billion.

16.However, the Master Plan on ASEAN Connectivity is a very ambitious initiative that cannot be undertaken by ASEAN alone. As such, ASEAN has been reaching out to our Dialogue Partners like the European Union and International Financial Institutions to take a more active role, such as through bankable public-private partnership projects. There are many business opportunities for companies in areas like infrastructure, logistics and ICT.

17.This is why we warmly welcome Italy’s initiative to raise awareness among Italian businesses and enterprises and the organisations such as the OECD, IMF and ADB of economic opportunities in our region. Together, we can foster greater economic integration between Italy and ASEAN countries. I am very happy to see Confindustria (Confederation of Italian Industry), Fondazione Economia Tor Vergata (Tor Vergata Economics Foundation) and SIMEST (Italian Society for Enterprises Abroad) involved in this Forum. I am also particularly pleased that the organisers have devoted a panel session this afternoon to focus on the topic “Infrastructure and Connectivity Development”. Given Italy’s diversified economy, world-class industries and development experience, I am convinced that Italy is in a position to make substantial contributions to the realisation of ASEAN’s aspirations to establish the ASEAN Economic Community. To that end, Singapore and our fellow ASEAN member states very much look forward to working closely with Italy for mutual benefit.

Conclusion

18.In closing, I am confident that today’s forum will pave the way for a strengthening of bilateral economic relations between Italy and ASEAN. On behalf of the Singapore delegation, let me thank the Government of Italy, Minister Giulio Terzi and the Italian Ministry of Foreign Affairs for your warm hospitality and hard work put into organising this very meaningful and important forum. I wish everyone here a fruitful and enjoyable experience at this conference.

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