SINGAPORE: Singapore is hoping that building expertise in high-tech niches such as 3D printing and robotics will let it sustain a large manufacturing sector despite the exit of many labor-intensive industries to cheaper bases elsewhere in Asia.
In line with government efforts to lift productivity and cut reliance on foreign workers — whose big numbers have made citizens unhappy — Singapore’s Economic Development Board (EDB) no longer courts multinational companies that want to employ many low-cost employees.
But it keenly wants to pull in more companies for cutting-edge production.
“The future of manufacturing for us is about disruptive technologies, areas like 3D printing, automation and robotics,” EDB Managing Director Yeoh Keat Chuan said.
The economic planning agency is hoping more firms will follow Rolls-Royce and Procter & Gamble to take advantage of new technologies it’s trying to promote, as well as Singapore’s low tax rates and other incentives.
P&G recently opened a S$250 million ($198 million) research center in the city-state and has signed an agreement with Singapore’s science and technology agency giving it access to Singapore’s universities and hospital research facilities.
Rolls Royce signed a S$75 million deal with one university last year to do research into computational engineering and other areas.
The EDB, which has helped drive the island’s transformation from a trading outpost to an economic powerhouse, lured technology companies in the late 1960s and 1970s with incentives and low-cost labor.
Operations to assemble televisions and components have gone to Asian countries with much lower wages. However, manufacturing still accounts for about 20 percent of Singapore’s gross domestic product, and the government wants the level to remain 20-25 percent. In rival financial center Hong Kong, manufacturing makes up about 2 percent of the economy.
Singapore is focused on developing a regional manufacturing supply chain, where companies can base labor-intensive work in nearby countries, while engineering and design work is done at home.
And it hosts sophisticated manufacturing.
About one-third of the world’s hearing aids are made in Singapore, many by German engineering conglomerate Siemens AG.
But for manufacturing in general, “it’s not possible for us to do everything in Singapore,” said Yeoh.
“Activities which are much more labor intensive and can’t be sustained in Singapore will need to move out.”
He is hoping higher-paid work in sectors such as 3D printing and biologics — making drugs from proteins in cell cultures rather than synthetically — can expand.
In the service sector, Singapore wants to develop technologies for e-commerce and big data.
The city-state has a target of 2,500 data analytics professionals by 2017. Already, about half of Southeast Asia’s data center capacity is in Singapore.
“That’s not because we have low-cost energy, we don’t, or because our weather is cool, it’s not, but because companies feel very confident about the security of the data residing in Singapore,” said Yeoh, who has led the EDB since 2012.
Singapore’s shipyards industry is one that may have to shrink as part of the government’s productivity drive. While it currently employs 120,000 of the city-state’s 5.3 million people, the number of foreign workers versus local is 5-to-1, a ratio the government wants at 3.5-to-1 by 2018.
One set of foreigners the government is keen to maintain are top-level executives, as it tries to get more multinationals to set up regional or international headquarters.
Last year, the city-state received a boost when General Motors said it would shift a unit that oversees much of its international operations to Singapore from Shanghai, a decade after the company left the island.
Singapore’s low taxes and high living standards make it a popular choice. A study by the Frontier strategy group in 2010 found 44 percent of global companies’ Asian headquarters were in Singapore, compared to 17 percent in Hong Kong and 13 percent in Shanghai.
BASF and IBM are among corporates that have moved global units, led by key executives, to Singapore.
“These are top caliber leaders — the question for us is whether we can see Singaporeans eventually taking on these positions,” said Yeoh.
Singapore targets investment in ‘disruptive’ technologies
Singapore targets investment in ‘disruptive’ technologies
Saudi ports brace for cargo surge as shipping lines reroute
RIYADH: Preliminary estimates suggest that several global shipping lines could reroute part of their operations to Saudi Arabia’s Red Sea ports, potentially adding 250,000 containers and 70,000 vehicles per month, according to Rayan Qutub, head of the Logistics Council at the Jeddah Chamber of Commerce, in an interview with Al-Eqtisadiah.
“Any disruption in the Strait of Hormuz not only affects maritime traffic in the Arabian Gulf but could also reshape global trade routes,” Qutub said, highlighting the strait’s status as one of the world’s most critical maritime chokepoints for energy and goods transport.
With rising regional tensions, international shipping companies are reassessing their routes, adjusting shipping lines, or exploring alternative sea lanes. This signals that the current challenges extend beyond the Arabian Gulf, impacting the global supply chain as a whole.
Limited impact on US, European shipments
The effects of these developments will not be uniform across trade routes. Qutub noted that goods from China and India, which rely heavily on routes through the Arabian Gulf, are most vulnerable to disruption. In contrast, shipments from Europe and the US typically traverse western maritime routes via the Suez Canal and the Red Sea, making them less susceptible to regional disturbances.
Saudi Arabia’s strategic location, he emphasized, strengthens the resilience of regional trade. The Kingdom operates an integrated network of Red Sea ports — including Jeddah, Rabigh, Yanbu, and Neom — that have benefited from substantial infrastructure upgrades and technological enhancements in recent years, boosting their capacity to absorb increased cargo volumes.
Red Sea bookings
Several major carriers, including MSC, CMA CGM, and Maersk, have already opened bookings to Saudi Red Sea ports, signaling a shift in operational focus to these strategically positioned hubs.
However, Qutub warned that rerouted shipments could increase sailing times. Cargo from Asia, which normally takes 30-45 days, might now require longer voyages via the Cape of Good Hope and the Mediterranean, potentially extending transit to 60-75 days in some cases.
These changes are also reflected in rising shipping costs, driven by longer routes, higher fuel consumption, and increased insurance premiums — a typical response when global trade patterns shift due to geopolitical pressures.
Qutub emphasized that Saudi Arabia’s transport and logistics sector is managing these developments through coordinated government oversight. The Ministry of Transport and Logistics, the Logistics National Committee, and the Logistics Partnership Council recently convened to evaluate the impact on trade and supply chains. Regular weekly meetings have been established to monitor developments and implement solutions to safeguard the stability of supplies and continuity of trade.
He noted that the Kingdom’s logistical readiness is the result of long-term strategic investments, encompassing ports, airports, road networks, rail systems, and logistics zones. Today, Saudi logistics integrates maritime, land, rail, and air transport, enabling a resilient response to global disruptions.
Qutub also highlighted the need for the private sector to continuously review logistics and crisis management strategies, develop alternative plans, and manage strategic stockpiles. Such measures are essential to mitigate temporary fluctuations in global trade and ensure smooth supply chain operations.
