Speech by Minister for Transport Mr Ong Ye Kung at MOT National Day Observance Ceremony

Truths to Keep Singapore Moving

1.     A new world order is now reshaping Singapore’s global connections.

2.     Technological and economic rivalry between China and US may bifurcate global supply chains and alter global trade and shipping patterns.

3.     The melting of the Arctic ice sheets could reshape maritime routes. Heightened environmental consciousness must push us all to use cleaner energy, domestically and internationally.

4.     But the biggest disruption is COVID-19, which has hamstrung and crippled us. It has grounded planes, confined us to our homes, and forced us into a virtual life – eLearning, telecommuting and e-commerce.

5.     But some things remain unchanged, such as our geography. As early as the 13th Century, the island of Singapore has been a bustling regional port. We rode the monsoons to connect the markets of India, Southeast Asia and China.

6.     The British arrived in Singapore in 1819, established it as a settlement and turned us into a free port. We connected with Europe – that was perhaps Globalisation 1.0.

7.     Post-independence in 1965, we found our footing in a US-led world order. We industralised, attracted MNCs to Singapore, and became a global hub for many business activities.

8.     The reason for this continuity is the importance of the Straits of Malacca to global trade. Even today, up to a third of global trade passes through the Straits.

9.     But geographical endowment is not enough, because the road we travelled since then is not made by Nature but carved by hand. We seized maritime opportunities to establish hubs in aviation, finance, infocomms, MICE, education, research and development. A few generations of Singaporeans worked hard to bring them here.

10.    It is important to recognise these constants in the midst of change. They offer us a centre of gravity as we adapt to a different future.

A Greener Way to Move

11.    Let me start with land transport, which all of us hold dear.

12.    I am deeply thankful to MOT, LTA, SMRT and SBS Transit for the vast improvement in train service reliability over the past few years. The system used to suffer a breakdown longer than five minutes for every 130,000 train-km travelled. Now it is clocking over a million train-km between such breakdowns.

13.    When I visited the SMRT Tuas Depot in the wee hours of Hari Raya Haji last week, SMRT CEO Neo Kian Hong told me that 70% of maintenance effort is now devoted to preventive maintenance, and 30% to corrective maintenance. A few years ago, the ratio was almost flipped the other way around.

14.    This is a clear sign that we have turned the corner. As they have done so many times in Singapore, engineers here have saved the day. Still, this is not a declaration of victory, but a cautionary bell. What we have today is hard won. We must continue to place maintenance and engineering as a top priority.

15.    Over the next decade or so, we will open new stations and lines almost every year – starting with the remaining stages of Thomson-East Coast Line, to completing Circle Line, and opening Jurong Region Line and then Cross Island Line. The MRT network will grow from around 230km today to 360km by then.

16.    We are also expanding the cycling network, improving first and last mile connections. The bus network will complement the train network.

17.    We are devoting a lot of resources to land transport. The MRT map today is as tight and as comprehensive as many advanced European cities. MRT lines are expensive to build, and the Government does not recover the infrastructure costs through fares.

18.    It also costs a lot to maintain and operate the system, and renew ageing operating assets, especially for the MRT system. Fare revenue is insufficient to cover these operational expenses. Government has been spending $2 billion every year to subsidise the running of the public transport system.

19.    But an attractive public transport system brings about a greener, fairer and better Singapore, and help us move towards a car-lite nation. Transport is one part of the greener development of Singapore. MOT will be working closely with MND and the new MSE, to develop a comprehensive sustainable development plan for Singapore.

Intersection of World Trade

20.    Let me now turn outwards, to sea and air – lifeblood to an islandnation.

21.    Investors in Singapore want the assurance that components, finished products, their key people, customers, partners and suppliers, can come in and out of Singapore freely. This freedom of movement, goods, and capital give us a significant competitive edge.

22.    Our seaport and airport are our two lungs – taking in oxygen and vitalising all other parts of the body. Every sector of our economy relies on our seaport and airport. Let me start with the one lung that is doing relatively well despite COVID-19 – our seaport.

23.    When I was in primary school – in the 1970s – I learnt that Singapore was the second largest port in the world by cargo volume, after Rotterdam.

24.    Today Rotterdam has dropped to number 11. Number one is now Shanghai. But Singapore remains at number two after all these years. How did that happen?

25.    It is because Rotterdam and Shanghai are gateway ports, meaning that they manage the transport of cargo in and out of large hinterlands like Europe or China. So as the economic weight of countries and continents changes, the sizes of the gateway ports change.

26.    But Singapore is a transshipment port. We are an interchange of theworld, where cargo arrives and reconnects to other shipping lines.

27.    So today, one main haul ship that arrives at Singapore will typically transfer its containers to 100 other ships. It then takes on containers from another 200 ships. So, each main haul ship calling at Singapore represents 100 x 200 = 20,000 connections. This is what it means to be an interchange of the sea.

28.    As a transshipment port, Singapore has been the biggest in the world, by volume. That is in turn due to the importance of the Straits of Malacca and Singapore, which has not diminished from the time I was in primary school.

29.    We built on our dynamic port and generated many other complementary industries, in shipping, ship finance, marine insurance, maritime legal, maritime logistics.

30.    Our port has been affected by COVID-19, and PSA is anticipating a drop in volumes this year. But PSA will respond nimbly, to capture new opportunities in areas such as e-commerce, and investing in its competitive advantage.

31.    PSA is developing the Next-Generation Tuas Port and consolidating its operations there. By the 2040s, it plans to handle capacity of up to 65 million TEUs. PSA is also not just the Port of Singapore, but a network of ports across continents, adding resilience to Singapore’s hub status.

Reviving our Air Hub

32.    Unlike the seaport, our other lung – the airport – has been almost totally incapacitated. Strict border measures, and health concerns have deflated international air travel to almost zero.

33.    We used to record over 1,000 aircraft movements a day, now it is about 150. We were the 7th busiest airport in the world in terms of international passenger traffic, but have dropped to 50th. Worse, we have no domestic air travel to fall back on.

34.    We have tried to bring back demand in various ways. Cargo planes are still using Changi, but they are only about 5% of total flights pre COVID-19.

35.    We have started to serve transfer and transit passengers, but even at its peak, they accounted for at most a third of total Changi passenger traffic. Today we are serving only a trickle of that, at 400 passenger movements a day, or 150,000 a year, compared to our pre-COVID 19 volume of close to 20 million a year.

36.    As colleagues from Changi Airport told me, COVID-19 set us back by at least 40 years, to 1981 when Terminal One first opened. But there is a big difference between then and now.

37.    In the early 1980s, many airlines had not decided to come to Changi. We went all out to secure airlines, including unilaterally opening up our skies to invite the carriers to come to Changi.

38.    Today, the airlines are here, and Changi has grown into a world-class airport. Our challenge is to restore passenger volume, while keeping virus transmission under control. The circumstances are different, but we need the same hunger and enterprise as we had in the early 1980s.

39.    A good place to start are the countries and territories where the virus transmission risk profiles are similar to or better than ours. Including transfer-transit traffic, they account for about 40% of our pre-COVID-19 passenger volumes.

40.    But passenger volumes cannot be turned on and off capriciously. We need to take sensible measures concurrently, proportionate to the risk profile of each country, and make progressive steps as we become more confident.

41.    For example, we can consider unilaterally opening up to passengers from certain countries or regions which have kept the virus under control. We can proliferate Reciprocal Green Lanes for business travel, and also expand them for general travel. Serving 14-days isolation is a major deterrent to travelers, and we may have to consider replacing this with a rigorous testing regime.

42.    Health and economic considerations are not at odds – we will find ways to revive our air hub and keep Singapore safe.

Conclusion

43.    On my second day at MOT I visited Changi Airport. The management received me at Terminal Two, closed due to COVID-19.Beautiful bougainvillea plants used to line the entrances to the departure hall, but on that day, the plants were all withered.

44.    I asked Changi Airport Group CEO Lee Seow Hiang why. He said the Terminal has been closed, and they had to save costs, including on plant maintenance. He added “But bougainvillea are hardy, and they will live.”

45.    I did what a gardener friend taught me and used my nails to scratch the bark of one of the withered plants. Indeed, underneath the dried brown bark, was a bright green stem. If the plant had a heart, it was still pumping strong.

46.    When it comes to the fate of Singapore, the following truth holds: To survive, we have to keep our borders open. To thrive, we have to connect to the world. To prosper, we have to be a hub of the global economy.

47.    Hence MOT’s mission – building the physical connections that bring Singaporeans together, the world to Singapore, and Singapore to the world.

48.    COVID-19 has decimated air travel and incapacitated one of our lungs, but the Singapore heart – our determination, dynamism and enterprise – is still pumping strong. Changi Airport will one day be full again, SIA planes will once again soar. This is our collective mission in the coming months and years ahead, as we await the blooming of the bougainvillea once again.

49.    Have a Happy 55th National Day!