Speeches 11 Sep 2019 Updated 11 Sep 2019 Speech by Minister For Trade and Industry Chan Chun Sing at the Singapore-China (Chongqing) Economic and Trade Cooperation Forum Share: SPEECH BY MINISTER FOR TRADE AND INDUSTRY CHAN CHUN SING AT THE SINGAPORE-CHINA (CHONGQING) ECONOMIC AND TRADE COOPERATION FORUM 11 SEPTEMBER 2019, 1030HRS, SHANGRI-LA HOTEL, SINGAPORE Member of the Political Bureau of the CPC Central Committee and Chongqing Party Secretary Chen Min’er (陈敏尔) Ambassador Hong Xiaoyong (洪小勇) Vice Minister of the International Liaison Department of the CPC Central Committee Guo Yezhou (郭业洲) Executive Vice Mayor of Chongqing Municipal Government Wu Cunrong (吴存荣) Ladies and Gentleman, Good morning, Background of Bilateral Cooperation On behalf of the Singapore government and business community, let me first extend a very warm welcome to Secretary Chen and our friends from Chongqing. I had a very good meeting with Secretary Chen earlier this morning, where I expressed my appreciation for the support and guidance he has given for our projects in Chongqing. This forum is a timely opportunity for us to take stock of Singapore-Chongqing collaboration, and exchange views on how we can deepen this relationship. As with all other bilateral projects between Singapore and China, we continuously seek to break new ground and we are never complacent and never resting on our laurels. Over the years, Singapore and China have developed a strong and multi-faceted relationship. China is Singapore’s largest trading partner, while Singapore is China’s largest foreign investor. Today, as the global economy faces greater stress and uncertainties, the continuous effort by both sides to maintain the momentum for greater economic integration is ever more important. To this end, we upgraded the China-Singapore Free Trade Agreement last year. We have also worked together to bring about substantial progress in the Regional Comprehensive Economic Partnership, and hope it will make greater progress towards conclusion later this year. Our cooperation is based on the shared belief that our people will benefit more when we keep our economies open, leverage the best from each other, create more opportunities for our people and businesses, and allow our production processes, supply chains and distribution networks to be optimised at a deeper level. China-Singapore (Chongqing) Connectivity Initiative Building on this strong foundation, the China-Singapore (Chongqing) Connectivity Initiative, or CCI, was launched in 2015 as the third Government-to-Government project between our two countries. The CCI is based on the theme of "modern connectivity and modern services", in line with how Singapore-China collaboration has evolved in tandem with China’s development needs, priorities and trajectories. And as we were discussing earlier, the concept of this project is never static. Every time when I meet Secretary Chen and every time our officials from both sides meet, we continue to brainstorm new ideas to take the project to the next level. We will continue with this spirit of constantly looking for opportunities and constantly delivering on things that we have promised. The CCI also demonstrates how we complement each other’s strengths. Chongqing’s strategic location enables it to anchor China’s Western Region Development, while advancing the Belt and Road Initiative and the Yangtze River Economic Belt strategies. Meanwhile, Singapore is a base for businesses from all over the world to access markets, capital and technology. Through our joint efforts, the CCI aims to foster greater connectivity, not just between Singapore and Chongqing, but also between the regions of Western China and Southeast Asia. This link is not just between Southeast Asia and Western China.In time to come, it will be a link from Southeast Asia through Western China and onward to Central Asia. Role of the CCI-ILSTC in Regional Integration CCI is therefore not a conventional project bound by a physical location. Instead, the CCI, with Chongqing as the operating base, aims to catalyse the economic growth of an entire region. To achieve this, we need to do two things. First, we must make sure the cost of financing projects and businesses in Western China is comparable to the coastal provinces. Second, we must be able to find a way to connect Western China to the rest of the world through the fastest and cheapest possible way. This is why we developed the CCI New International Land-Sea Trade Corridor (CCI-ILSTC), which substantially reduces the duration and cost of transporting products. Today, goods transported along the CCI-ILSTC can reach Southeast Asia in one third the time compared to the conventional route. This means that what used to take three weeks is now achievable within seven days. If we can further integrate our customs processes and data platforms, it can be further reduced to five days. And because we are able to do this in a multi-modal way through the air, land, sea and river links, we will be able to create new opportunities for the transportation of goods that were previously not achievable, such as fresh produce. ASEAN and China enjoy a strong economic relationship. China has been ASEAN’s largest trading partner in the past decade, while ASEAN is now China’s third largest trading partner. While trade between ASEAN and Western China is growing exponentially, it still forms a relatively small portion of ASEAN-China trade. With a combined population of more than a billion and economies growing faster than the global average, ASEAN and Western China are two of the world’s most dynamic regions. There is vast untapped potential to boost trade and investment flows between the two regions by leveraging the CCI-ILSTC. Western China is two-thirds of the land area in China and one-third of the population. Western China also has tremendous resources and talent. There is great potential for us to bring the two regions together and leverage each other’s strengths to take our economies forward at a faster pace and bring about benefits to our people and businesses. Chongqing’s Role as the Hub for Western China In this regard, I would like to personally thank Secretary Chen and the Chongqing officials for their successful efforts in bringing all the Western China provinces on board the CCI-ILSTC. It is now critical that we tap on the strengths of Chongqing to ensure meaningful involvement of the other western provinces. We should start by enhancing people-to-people exchanges to have a shared understanding of the concept and potential of this project. Last year, we saw the launch of the human resource development programme between Singapore’s Ministry of Foreign Affairs and Chongqing Organisation Department. I hope that senior officials from the other provinces can join subsequent study visits to Singapore and we can continue to learn from each other. As trade grows, the financial needs of our businesses will grow as well. We should help users of the CCI-ILSTC benefit from the CCI’s policy innovations. Financial authorities from both sides are working to set aside a foreign debt quota for CCI qualifying deals, which can be extended to the other Western China provinces when ready. This is how Chongqing has played its role as a pilot to catalyse the development of the entire Western China region. We should also work together to strengthen digital connectivity, between the custom authorities and between our companies. Singapore and China are now working to link China’s National Single Window and Singapore’s Networked Trade Platform to facilitate trade, starting with a pilot in Chongqing and along the CCI-ILSTC. I encourage provinces along the CCI-ILSTC to use this link to reduce time and cost for traders through the electronic exchange of trade documents. Enhanced digital connectivity also requires superior Information and Communications Technology infrastructure. I am glad that the International Data Channel will be launched later today. This will help position Chongqing as the Data Hub for Western China, connecting with Singapore, the Data Hub of Southeast Asia. The next lap of our collaboration will be even more important, building on the foundation that we have established over the last few years. I see three areas of great potential – First, we need to deepen the strategic understanding amongst our leadership and executive levels. To this end, we will work with the Chongqing leadership to regularise, expand and deepen the quality of courses and exchanges with all 12 Western China provinces under Chongqing’s leadership. This will enable more senior leaders from both sides to build up the shared understanding with one another. As with Suzhou, we look forward to this initiative grooming yet another generation of leaders from Singapore and China with a shared understanding of our challenges and opportunities. And as I was sharing with Secretary Chen earlier this morning, one of the reasons why projects between Singapore and China can proceed so smoothly and quickly is due to our shared understanding. Beyond understanding the mechanics of working with each other, the most important thing we can do for the next generation is to plant the seeds of mutual understanding. Second, the integration of our physical and non-physical platforms to facilitate trade and promote integration. To this end, we should intensify the efforts for more of our people, enterprises and government agencies to use common standards and shared platforms, in areas such as custom clearance, finance, and mutual recognition of standards for products and services. The more we harmonise our platforms, the more we share our platforms and recognise each other’s standards, the greater the opportunities for businesses and the less barriers. Amidst the world of uncertainties where businesses are looking for long-term opportunities, such common standards and common platforms are of vital importance to the growth of our enterprises. Third, the intensification of our efforts to promote the use of the new north-south corridors. The connection between Chongqing and Singapore must catalyse the wider connection between Southeast Asia and Western China. Indeed, Western China is also the link between Southeast Asia and Central Asia. The more people and enterprises use this network, the greater our economies of scale and the lower our costs. Similarly, the higher the frequencies of our air and sea links, the greater the efficiencies. We must develop the virtuous cycle where increased volume leads to lower costs, which in turn encourages greater volume. In our recent talks with the Central Asia countries, many of them said that they previously would have not thought of linking to Southeast Asia since it meant going to Northeast Asia before going down to Southeast Asia which is too long a route and too high a cost. But with the CCI-ISLTC, they shared that they now have a different perspective of how near Southeast Asia can be to the Central Asia region. We are also looking forward to sign the Free Trade Agreement with the Eurasian Economic Union which will create more opportunities for businesses. So it is timely that the overall plan for the Western Region Land-Sea Corridor released by the Chinese government last month positions Chongqing as a hub along the Corridor, and calls for greater international cooperation to develop the CCI-ILSTC. I look forward to hearing from Secretary Chen on how businesses in Singapore and the region can access opportunities in Western China through Chongqing and the CCI-ILSTC. Conclusion The success of our cooperation will not only bring tangible benefits to our people.It will also be a powerful testament to our belief in the benefits of connection and integration in bringing out the best in each other. In closing, I would like to thank Secretary Chen for the support given to the companies. I would also like to thank the Chongqing team who has worked quietly behind the scenes over all these years. The interestby our companies to participate in the development of Chongqing and the CCI-ILSTC can be seen in the number and range of MOUs that will be signed later today. Singapore is pleased to partner Chongqing as we play the role of mutual hubs in Southeast Asia and Western China respectively. We encourage everyone present today to make new friends and find new partnerships, to make use of this platform to enhance the connectivity between Singapore, Southeast Asia, Chongqing and China. This is a rare opportunity where Secretary Chen brought with him a huge delegation from Chongqing to establish trade links with Southeast Asia and it is also a valuable opportunity to hear from him on his vision for this project to take both our bilateral ties and the relationship between the two regions to the next level. Thank you.