Creating opportunities and improving lives in a digital age
1. I would like to thank Members for their kind comments.
2. Mr Chairman, with your permission, I would like to show a short video summarising the work of my ministry over the past year, and some slides throughout our responses.
Embracing digital, harnessing opportunities
3. Digitalisation has created many exciting opportunities and improved Singaporeans’ lives. There are many examples of fellow Singaporeans embracing digital and harnessing opportunities.
4. One was in the video we just watched. Ms Shakila Sham owns Eatz 19, a fusion restaurant. She decided to install a mobile ordering and payment solution, which allowed her customers to review the menu and order even before arriving at the restaurant, so they can avoid the queue. This way, the customer is happy, and she was able to improve her operations with the data generated. Most importantly, the added convenience made work more enjoyable for Shakila’s wheelchair-bound employee, Suzy, who can now manage the ordering platform online, from home.
5. Another example is Mdm Santhiya Senthil Kumar, an avid self-learner. She attends coding classes with her son in the library. This way she can bond with her family, and pick up a new skill in the process. She was able to apply her new skill to guide her son in coding his own games.
6. There are many more Shakilas and Santhiyas out there. Helping them do well is what drives all of us at MCI. This COS, we will share with you MCI’s efforts to do so. I will talk about our plans to develop our digital economy and enhance the digital readiness of Singaporeans. SMS Janil will elaborate on how workers, businesses, and citizens can benefit from our digital economy and digital readiness efforts. SMS Chee will explain MCI’s efforts to transform and grow the media sector. I will round up by sharing the wonderful transformation of our libraries, which should inspire us all.
The ABCs of growing the digital economy
7. Let me begin with the digital economy. Digital transformation is the most important issue facing businesses today. Singapore Business Federation’s recent study showed that the majority of our businessmen fully appreciate the importance of digitalisation because the payoffs are enormous. Microsoft’s recent study estimated that the digital economy would contribute another US$10 billion to our GDP by 2021. This is the context for our Smart Nation initiative – good jobs and opportunities for our people.
8. Mr Zaqy Mohamad asked what the government is doing to ensure that Singapore businesses and workforce can thrive in the digital future. My answer is “ABC” - Accelerate the digitalisation of existing sectors, Build up our infocomm media or ICM companies, and Create future digital technology sectors. Let me explain.
Accelerate digitalisation of sectors
9. Firstly, A - Accelerate the digitalisation of existing sectors. Digitalisation affects every sector. But not all of the sectors have responded equally quickly. Some sectors like banking and finance, and retail have done relatively well. During my recent visit to NTUC Fairprice’s new “living lab” supermarket at SingPost Centre, I saw how Fairprice had transformed its traditional supermarket using innovative retail technologies to revolutionise the shopping experience to meet changing consumer expectations and habits in the digital age, while boosting workers’ productivity. But there are other sectors that are finding it more difficult to keep up.
10. Members asked how the Government can help SMEs benefit from digitalisation. Allow me to first share the common challenge that SMEs face in going digital. One reason why some sectors are unable to transform digitally is knowledge. Even if companies are keen to embrace digital, they do not know how to, or where to start. This is particularly true for SMEs, which sometimes lack the resources and scale to deploy digital solutions. That is why we launched the SMEs Go Digital Programme last year, which for a start, focuses on key sectors where digital technologies can improve productivity significantly. This includes providing step-by-step guidance under the Industry Digital Plans, or IDPs, to make digitalisation simpler for SMEs. We have since launched the Retail and Logistics IDPs last November and we aim to do more this year.
11. Members asked about the outcomes of our initiatives to help SMEs digitalise. Even though the programme has been operational for only less than a year, we are seeing encouraging results. More than 650 SMEs have benefitted from the programme, with many more waiting in line.
12. A beneficiary of the pre-approved digital solution under the Programme, is House of Seafood, a restaurant chain and food manufacturer. It exports its products to many countries. However, each country has its own import requirements, and it was difficult to track them all efficiently. So the company installed a digital tagging solution to automate the compliance checks for its many products. House of Seafood is now able to export its products more easily, and has grown its sales by 20% and productivity by 25%.
13. Another example is OKH Logistics. The complexity of the logistics business cannot be underestimated. So the company adopted an intelligent vehicle monitoring system to operate its vehicles better. By analysing the data collected, it was able to significantly reduce the number of vehicle accidents by 50%. Fewer vehicle accidents mean better utilisation of assets. This led to about 10% increase in the number of deliveries handled each day.
14. We will continue to grow the SMEs Go Digital Programme and we aim to benefit many more SMEs. To do so, I fully agree with Mr Teo Ser Luck that we must ensure that our programmes remain relevant in a fast changing environment. We will regularly review the IDPs and pre-approved solutions in the SMEs Go Digital programme, to ensure that they are in line with the latest industry trends and standards while meeting SMEs’ needs.
15. Mr Zaqy Mohamad asked what more can be done to help our SMEs seize the opportunities in digital. Ms Sun Xueling asked if we would engage influential partners to help drive digitalisation within sectors. One initiative we are pursuing is to focus not just on individual solutions for individual SMEs, but to take a cluster approach by working with influential partners to help a group of SMEs from similar sectors. For example, in the logistics sector, the Infocomm Media Development Authority, or IMDA, is working with major logistics companies, Bollore Logistics, Dimerco, and L.C.H. Lockton to lead their SME clients through the digitalisation process using a cloud-based e-Cargo Consolidation Platform. This aggregates freight demands, thereby lowering freight costs for SME freight forwarders. This initiative will be launched in April and, for a start, over 100 SMEs are expected to benefit from this project. We will do more of such projects in the coming year.
16. Ms Sun Xueling asked what sector-level initiatives do we have to drive digitalisation on a broader scale. Last year, IMDA launched various innovative initiatives to support the digital transformation of both the Logistics and Retail sectors. As part of our efforts in the Retail sector, we are collaborating with SPRING, the Singapore Malay Chambers of Commerce and Industry or SMCCI, and One Kampong Gelam Association to develop Kampong Glam into Singapore’s first digitally enabled retail neighbourhood. What does this mean?
17. We will help interested merchants in the core area of Kampong Glam, comprising 200 merchants, adopt digital solutions to improve their business operations. This would include adopting integrated point-of-sale systems which enable cashless payments, inventory tracking and financial accounting. By automating these backend administrative processes, the merchants will have more time for their products and customers. We are working with Starhub on these business solutions for the merchants.
18. We are also enhancing the visitor experience by developing digital products, such as immersive walking trails, and working with Temasek Polytechnic School of Business to increase merchants’ online presence. We are partnering Grab to offer an additional cashless option and increase accessibility to the area. After all, the shops will benefit from more customers enjoying themselves in Kampong Glam.
19. We will launch Phase 1 of the transformation in 2Q 2018. Learning from the Kampong Glam project, we will explore how we could develop other projects to digitalise the Retail sector. Let me also take this opportunity to thank the leadership of One Kampong Gelam and SMCCI for their support.
20. Another way we are accelerating sector digitalisation is to put in place common infrastructure that will raise business productivity. One such project is e-invoicing. Invoices are critical functions for businesses - without an invoice, businesses do not get paid. But invoicing can be very tedious and manual, with many inherent errors. E-invoicing can change that. It can help businesses cut costs, ensure companies are paid faster, and open up new financing options. We are currently studying this with companies, and will announce more details later.
Building our infocomm media companies
21. I shall move on to “B” - Build up our ICM companies. This is necessary, because without a strong ICM sector to support businesses with good products, we will not go very far in our digitalisation journey. In this respect we want to have home grown ICM companies along with other companies supporting this sector.
22. Mr Zaqy Mohamad asked about the plans to grow the ICM sector. IMDA has already launched the ICM Industry Transformation Map, or ITM, last year. Under our ITM, we aim to create 13,000 new PMET jobs, and the industry’s value-added is expected to grow at around 6% annually. We will do this by building up our workforce, and helping our companies internationalise. Most importantly, as digitalisation blurs traditional industry boundaries, we will help our companies reinvent themselves.
23. Several ICM companies have already done so. One example is Y3 Technologies, a software solutions provider specialising in supply chain management solutions. In recent years, Y3 has transformed itself by moving away from just supply chain management, to an innovative analytics service provider. Thanks to its proprietary software, it now has 24/7 visibility of all customer orders, can handle a larger volume of orders, and reduce incidence of wrong delivery. It has also used its analytics software products to diversify into complementary areas such as e-commerce. We will do more to help our ICM companies transform themselves like Y3.
24. Today, IMDA runs Accreditation@SG Digital, which helps to scale innovative Singapore-based ICM companies to build deep capabilities locally and grow internationally. Currently, we have 24 accredited companies. We will quadruple this in 5 years, and avail more support to help them grow including building their track record, assisting them to secure new growth capital and helping them expand overseas. In the case of Sense Infosys, an accredited local data analytics start-up, IMDA’s support in securing funding and facilitating key partnerships had contributed to the company’s overseas expansion and impressive growth.
25. One way to build stronger ICM companies is to help them collaborate with end-users to build new and innovative solutions with potential to be scaled and exported. This might not be that easy with digitalisation blurring the lines between sectors, which creates the need to solve problems that cut across many sectors and disciplines. IMDA will pilot the Open Innovation Platform, which is a crowd-sourcing platform to facilitate collaboration between problem owners and a community of solution providers, to co-develop digital solutions that address actual business problems.
26. IMDA will focus their efforts in selected sectors first, including retail and logistics, to build up a community of solution providers. IMDA will bring in expertise in technology areas such as AI and IOT, to see how they can apply their technologies to business use cases.
Creating future digital technology sectors
27. The final thrust to build the digital economy is “C” - Create future digital technology sectors. Last year, I announced that we will invest in developing deeper capabilities in four frontier technology areas - data analytics and artificial intelligence or AI, internet of things or IOT, cybersecurity and immersive media. I also announced a series of AI and data analytics initiatives.
28. As part of our ICM ITM, IMDA launched the AI Business Partnership Programme last November to bring companies interested in AI and AI solution providers together. Although it is early days, IMDA has received promising problem statements from businesses across various sectors and is currently reviewing potential partnerships for co-funding. IMDA will share more details in the coming months. IMDA also launched the AI Apprenticeship Programme with AI Singapore, to develop AI professionals through training courses. To date, the Programme has received overwhelming support, and the first batch of 20 trainees will start training in May.
29. Mr Cedric Foo asked what Singapore is doing to prepare itself for the digital economy, including giving enterprises access to data sets for machine learning applications. The Data Innovation Programme Office under IMDA is trying to bring companies together to realise the value of sharing data, and brokering partnerships for mutual gain. For instance, the Government has been actively improving data.gov.sg, its one-stop public portal for Government datasets, to include more useful datasets to enable businesses and citizens to co-create solutions using them. We are also reviewing the Personal Data Protection Act to keep pace with technological developments and regulatory trends to facilitate businesses’ use of personal data while safeguarding consumers’ trust.
30. Besides AI and IOT, we see great promise in cybersecurity. Cybersecurity is integral to the digital economy. As more services and transactions take place online, it becomes even more important that they are digitally secure and reliable. Cybersecurity is thus a cornerstone of trust in our Smart Nation. Ms Sun Xueling asked if there are plans to assist businesses, including SMEs, and educate the public on how to prevent and respond to cybersecurity threats. We are indeed doing so. For instance, the Cyber Security Agency, or CSA, is partnering the Association for Information Security Professionals (AISP) to equip SMEs with cybersecurity knowledge so they can better respond to cybersecurity threats like the ransomware attacks last year. CSA also works with partners such as the Personal Data Protection Commission to raise awareness of the importance of cybersecurity and personal data protection among our students, and with IMDA and the National Library Board to provide seniors with infocomm training, which includes cybersecurity.
31. I agree with Mr Zaqy Mohamad that a vibrant cybersecurity ecosystem is an important factor contributing to robust national cybersecurity. Besides undergirding the digital economy, cybersecurity is also a growth engine. Cybersecurity in Singapore is a fast growing sector, with the potential to generate $900 million in revenue by 2020. This will create many exciting opportunities and jobs for Singaporeans.
32. Citi Singapore is one such company contributing to the cybersecurity ecosystem in our country. Not many Members may know this, but the bank has established one of its two global security operations centre in Singapore, the other being in the United States. I visited the Singapore centre two weeks ago. There I met Mr Fadli B Sidek, who I had mentioned in my COS speech two years back. Back then, he had overcome the disappointment of being rejected by a polytechnic, and was working towards a cybersecurity degree. Fadli is now a cyber-threat intelligence analyst in Citi, and doing well.
33. I was happy to see Fadli doing well, and want to help more Singaporeans interested in cybersecurity pursue their passions. CSA will work with other partners to do so. First, CSA and IMDA are supporting the development of the Innovation Cybersecurity Ecosystem at Block 71. This initiative will be done with NUS and Singtel Innov8, and will help promising cybersecurity startups scale and internationalise. Second, CSA will introduce a Co-Innovation and Development Proof of Concept Funding Scheme to support the development of cybersecurity solutions for national security, critical infrastructure and classified system users. This will catalyse the commercialisation and adoption of cybersecurity solutions to address emerging needs.
34. In addition to cybersecurity, we will also invest to build up immersive media capability in Singapore, or IM for short, as we also see this as another promising area. We aim to be the Centre of Excellence in the development and use of IM-based applications in key industries including engineering, media, retail and education. We will focus on three areas. First, advocate for IM adoption by facilitating business matching and information sharing to raise awareness on IM’s potential. Second, build innovation capacity by encouraging experimentation and development of proof of concepts. Third, develop talent for the IM industry. SMS Chee will share some of our efforts to build IM capabilities in his speech. We will announce more details of our plans for IM in the upcoming months. For now, we have put together an IM exhibit for Members to experience how IM can transform the way we live and work in the digital future.
Enabling the ABCs of the digital economy
35. To achieve these ABCs, we need several enablers. The first and most important is a strong workforce with the relevant expertise and skills. Two years ago, I launched the Tech Skills Accelerator, or TeSA for short. Since then, we have had excellent progress. As Minister Heng mentioned in his Budget speech, over 27,000 training places have been taken up or committed. One such beneficiary is Mr Muhammad Ruzaini bin Abdul Razak. Ruzaini was retrenched in 2015 after eight years in the industry. As he was interested in cybersecurity, he tried to join the industry after his retrenchment. However, he did not succeed as he lacked the formal training and qualifications. Fortunately, he persisted and joined the CSAT programme under NCS, where he picked up new cybersecurity skills. He is now a cybersecurity professional working for NCS.
36. The Government will invest another $145 million to scale up TeSA over the next three years. This will create another 20,000 training places by 2020, including in new sectors like manufacturing and professional services. This will allow us to further develop our workforce for the digital economy.
37. Besides people, we also need to review our regulations in a fast changing world, to ensure they remain pro-business and fit for purpose. Mr Ong Teng Koon asked how IMDA will address the regulatory challenges in the converged ICM environment. IMDA has been studying very carefully how to harmonise the approaches for the telecommunications and broadcast sectors, in areas such as competition, consumer protection and resilience. We believe that a converged competition and consumer protection code will provide clarity to industry, minimise regulatory overheads, while continuing to protect the public interest.
38. One salient issue in the converged ICM space is how digital technologies and social media platforms have come together to worsen the risk of Fake News. This was an area that MCI was studying in our review of the Broadcasting Act. However, as Parliament has just appointed the Select Committee on Deliberate Online Falsehoods to examine the issue, it would be better to study the Select Committee’s recommendations first, before making further moves. MCI will thus be deferring the review of the Broadcasting Act.
39. Dr Teo Ho Pin asked if there are plans to introduce regulations for AI applications. Currently we have no such plans as the field is still nascent and to avoid stifling innovation. But we do acknowledge public anxiety about AI. IMDA is working with sector regulators to study issues and mitigate potential risks from deploying AI.
40. Besides talent and regulations, another enabler for a thriving digital economy is a conducive, rule-based international environment. That is why we have advocated open data flows and facilitated cyber norms discussions in ASEAN. As ASEAN Chairman this year, we will commit to improving digital literacy in ASEAN, to help our people reap the benefits of digitalisation.
41. Beyond ASEAN, we are also participating fully in international mechanisms to provide digital flows. Last year I announced our intention to join the APEC Cross Border Privacy Rules and Privacy Recognition for Processors systems, two multilateral certification mechanisms to promote cross-border data flows. I am pleased to announce that our application was approved on 20 Feb 2018. When our certification scheme is in place, certified organisations in Singapore will be able to exchange personal data with certified organisations in participating APEC economies much more seamlessly, while consumers can be assured that the cross-border transfer of their personal data will be subject to high standards of data protection.
Ensuring digital readiness
42. Even as we grow the digital economy pie, we must ensure that everyone gets a slice of it, and that no one is left behind. And that is the main focus of our digital readiness efforts. Ultimately, Smart Nation is not just a series of technology projects. It is a whole-of-nation movement, to improve the lives of all Singaporeans in the digital age. As Minister Vivian had said earlier, our approach will therefore be inclusive-by-design.
43. Mr Saktiandi Supaat asked about the digital readiness workgroup and its proposed strategies to improve digital readiness among Singaporeans. We have set out a digital readiness blueprint to give every Singaporean digital access, which is the means to transact digitally; digital literacy - the skills, attitudes and values of a digital citizen; and digital participation - the ability to make use of technology to improve daily life. SMS Janil will elaborate on this later.
Conclusion
44. The possibilities of the digital future are endless. It is up to us to seize them. Everyone will have a role to play in our broader digital transformation, and we will work with everyone to ensure that we all gain from this shared journey. Thank you.