Ladies and Gentlemen:
Gong Xi Fa Cai, Xin Nian Jin Bu!
While the majority of Singaporeans are celebrating the Lunar New Year at home with their families, you are working hard to maintain the 24-hour service of our container port. Throughout the year, no major festival or national holiday stops PSA from servicing the ships calling at its terminals. It is this dedication to work by the PSA team of employees that has made it top-of-the-class worldwide.
Customers come and go. Competition becomes keener as others use their advantages of lower land and labour costs to grab a share of the business. Such competition is good, as it keeps PSA even more sharply focussed on delivering value for money to its customers.
PSA continues to invest in facilities and equipment – all capital-intensive – to provide even more efficient services. That is why PSA in Singapore has a customer base of 250 shipping lines that connect to 600 ports in 123 countries around the world.
Apart from first class facilities and equipment, PSA is a leading edge user of IT. This helps boost efficiency, slashing cargo turnaround times. Information is made more accurate. With this software, PSA not only helps shipping lines avoid delays, but helps them make up for lost time in other ports.
In news reports about the competition that PSA Singapore faces, the focus appears to be on box handling rates. Certainly the unit handling rate is an important parameter. However it is not the only parameter affecting cost. Shipping is a capital-intensive business, and time is money. An efficient shipping line must make the best use of expensive ships. Turnaround times are very important as well. Here PSA Singapore is a world leader.
Another factor that people tend to forget is the social cohesion of the country where the container port is located. With strong social defence, including harmonious industrial relations, Singapore can assure a shipping line of no disruption from industrial or social tensions.
So it is not just box handling rates, but overall efficiency, that determines the competitiveness of a container terminal operator. PSA remains highly competitive.
This is why shipping lines continue to sign contracts with PSA Singapore. One example is Cosco, who signed a 10-year Virtual Terminal Agreement with PSA recently.
We can expect competition to become fiercer. The PSA management must devise strategies to stay ahead of the competition. In recent years, PSA has ventured overseas to operate container terminals. It is never easy getting entry into other ports. But PSA has some notable successes. Last year, PSA’s overseas container terminals saw a solid growth of 33% over 2000. Last month itself, its throughput jumped by 51% compared to the same period in 2001.
The overseas business of PSA is an exciting dimension. The seeds have been planted for PSA to become a global player, not just a regional hub operator. The prospects for growth are therefore very good. The overseas dimension will allow PSA to reduce the unit costs of software development that will further enhance the competitiveness of PSA Singapore.
While the PSA management continues to develop strategies to sharpen the company’s competitiveness, employees must play their part by honing their skills. PSA spends 5% of payroll on training a year, and I am glad that employees take training seriously. Employees should also contribute their ideas on how to improve productivity. No saving is too small. Collectively many small ideas make a difference. Teamwork in PSA Singapore is excellent. That is why I have confidence in the future of PSA.
On this note, let me wish all of you a Happy New Year!
