Speech by President S R Nathan at the Singapore Chinese Chamber of Commerce and Industry (SCCCI) Lunar New Year Gathering

Mr Chua Thian Poh, President, SCCCI
Mr Teo Siong Seng, President-Elect, SCCCI  
Distinguished Guests,
Ladies and Gentlemen,

        I am happy to join you today for SCCCI’s annual Lunar New Year gathering.

Economic Outlook

2.     We celebrate the beginning of the Year of the Ox amid an increasingly severe global economic downturn.  The developed economies of the US, EU and Japan are forecasted to clock one of their worst-ever years of economic performance in 2009.  Growth outlook for regional economies has also deteriorated.  Singapore, being a small open economy, is inevitably affected.

3.      Singapore entered into recession in the 3rd quarter of 2008, and the situation has since worsened.  Our manufacturing sectors have been weighed down by falling export demand, while financial services have seen a sharp slowdown reflecting weaker market sentiments.  The downturn has also spread to become more broad-based, affecting the domestically-oriented segments of the economy, such as property, retail, and business services.

4.      But we can take heart from the fact that we are facing this downturn in a stronger position than in previous recessions.  Our economy is more diversified.  Our banking sector, while not immune to the global financial turmoil, remains sound.  Companies have stronger balance sheets and are less leveraged.  Households have low debt, and income has also increased across the board.  The Government is in a strong fiscal position, having been prudent over the years and building up reserves during our years of growth.  So while we cannot avoid the painful impact of a recession, we are in a good position to weather the downturn.

Weathering the Downturn

5.      The Government has acted to soften the impact of the economic slump.  The Ministry of Finance recently announced a significantly expansionary Budget.  Many aspects of this year’s budget are business focussed, aimed at helping companies cut costs and build capability.  The latter is critical, as our companies should use this opportunity to better position themselves for eventual recovery.

6.      We have maintained our focus on workers through the Skills Programme for Upgrading & Resilience (SPUR) programme, emphasizing retraining and upskilling as a way to upgrade and save jobs.  We have also taken fresh steps to facilitate access to credit for businesses.

7.      However, for us to do well coming out of this crisis, we have to work together to tackle the challenges.  Industry associations and business chambers can help to reach out to many of our companies who are members.  We need to continually emphasize to them that employees and employers have to work together to cut costs and save jobs.  Companies need to do their part and take the necessary steps to build capability and remain competitive, so that they will emerge stronger from the downturn.

8.      We are ushering in the Year of the Ox.  According to tradition, the Ox Year should help us weather the hardships we anticipate this year.  I am told there is now a popular Chinese saying, “Niú Zhuǎn Qián Kūn” (“牛”转乾坤), meaning the Ox can turn around Heaven and Earth.  Let us hope the Year of the Ox will help us take whatever hardships, as the Ox is reputed for.

SCCCI as an important partner

9.      The SCCCI has always played a leading role by rallying the business community to respond to national challenges.  This partnership with the Government is even more critical during these unusually difficult times.

10.     SCCCI has provided the Government with valuable feedback on how we can shape and improve our policies to better assist businesses.  I understand that many of SCCCI’s suggestions were taken into account when the Government formulated this year’s Budget.  I am pleased to know that SCCCI has also helped businesses to better understand and tap upon government assistance measures.  When the SPUR program was launched, SCCCI launched a series of seminars for Chinese-educated business members to help them to take full advantage of these measures.

11.     The SCCCI also plays an important role in helping companies to seek out opportunities by organising missions to new markets abroad.  Last year, the SCCCI led business missions to India, Vietnam and Dubai.  These overseas business missions will enable our companies to explore global opportunities, which are available even in the current downturn, so as to generate new sources of income and stay competitive.

12.     One of the countries that continue to present huge opportunities, despite the immediate downturn, is China.  While the US, Europe and Japan are likely to see virtually no growth this year, the International Monetary Fund estimates China’s economic growth in 2009 to be at 8.5 per cent.  An estimated 270 million Chinese will enter the middle-class bracket (per capita GDP of US$5,000), which will drive growth in demand for goods and services.

13.     The SCCCI can play a significant role to help Singapore companies identify and seize such opportunities in China.  SCCCI is Singapore’s unique conduit to China.  It has developed extensive networks over the years, and built up in-depth knowledge of the China market through the combined experience and expertise of its members.  In the past year, it has hosted many China investment seminars and launched an internship programme in Hangzhou.  The Chamber has also signed MOUs with its counterparts and overseas business organisations to facilitate business networking.  SCCCI is therefore well positioned to help our companies to continue tapping China’s strong growth.

14.     SCCCI has played an important role in the growth of our economy and our nation over the years.  I would like to take this opportunity to acknowledge the valuable contributions by the SCCCI Council over the years.  Mr Chua Thian Poh has served as President of the SCCCI for two consecutive terms.  I understand he will be stepping down in March this year.  I would like to commend Mr Chua for his leadership in serving the business community in Singapore, beyond SCCCI members and to our other Chambers.  I understand that there will be many new faces in the incoming Council.  I am sure they will continue the excellent work which successive generations of Councils have sustained towards promoting cooperation with other business chambers, and the Nation’s economic and social well-being.

15.     Let me now try to say a few words in Mandarin.

16     今 年 的 华 人 新 年 是 牛 年。牛很 勤 劳、很 刻 苦。面 对 经 济 难 关，我 们 也 要 勤 劳 刻 苦。希 望 牛 年 带 来 好 运,能 够 “牛” 转 乾 坤！祝 大 家: 新 年 快 乐、身体 健 康！