Mr Choo Chiau Beng, Chairman & CEO of Keppel Offshore & Marine
Comrade Mahmad Mastan, President of Keppel Employees Union (KEU)
Comrade Yap Huat Hin, President of Keppel FELS Employees Union (KFEU)
Comrade Wong Weng Ong, President of Shipbuilding & Marine Engineering Employees' Union (SMEEU)
Ladies and Gentlemen,
Challenges in the Sector
Four months ago, when I was at Keppel FELS for the National Day Celebration, Singapore’s economy was reeling from a series of impacts. We were in the red. Then, I urged workers and management to adopt tough measures if we wanted to recover quickly from the recession.
Today, we are seeing some encouraging signs of recovery. The latest estimates put our economic growth in the 4th quarter last year at 3.7%. We should be able to see a 0.8% growth for the entire year 2003. The marine and offshore engineering segment had seen a turnaround. Although it had suffered a decline for the most part of the year, the sector saw a growth of 6.2% in November 2003, with more shipbuilding and repair works done in the shipyards. In the absence of further unforeseen shocks to the economy, we should see a steady recovery.
Singapore has established a strong international reputation in the offshore and marine industry. Our shipyards are blessed with a strategic location, for ship-repair. Our shipyards have also been constantly reinventing themselves to provide high quality products and services at competitive prices.
Safety standards have improved significantly over the years. I understand that between 1993 and 2002, your Accident Frequency Rate per million man-hours made a huge improvement from 12.6 to an all time low of 2.3. This is better than the industry rate of 3.1. [It is not much different from the rate for the manufacturing as a whole – 1.8 accidents per million man-hours worked.] Keppel is therefore a very safe place to work in!
I was told that you are working to better these benchmarks by aiming towards an incident-free environment. Safety is now factored into every phase of your yards’ work from design to the flow of work in the day-to-day execution of every project. Safety is now being inculcated as an attitude and behaviour in every worker. Let's keep it up!
The marine sector in Singapore is not just ship-repair. We are today the world leader in the conversion of Floating Production and Storage facilities. Such vessels are hailed as the one of the latest solutions in deep water oil and gas production. The drilling jack-up rigs designed and built by Keppel FELS are well received by drilling contractors and operators. 60% of the world’s jack-ups on order in the last decade are Keppel FELS’ design and built. A few months ago, Keppel FELS and its subsidiary in Azerbaijan completed its own co-designed new generation semi-submersible platform for use in the harsh climate in Central Asia.
Credit must be given to Keppel and other companies in this sector, for being globally competitive. This is due to capable and well-trained people. The management has been keenly aware of the global challenges, and so has adopted the right strategies.
While the industry remains a growing one, the business climate is changing and becoming more difficult. I have been told that the most recent multi-billion dollar Brazilian contract was won by an international consortium led by Keppel Offshore & Marine. In this project, only a fraction of the work is coming to Singapore compared to the lion’s share remaining in Brazil. For the next project, they have expressed their desire to see all the work being carried out in Brazil. This is an indication of the competition to come.
Cooperation between Management and Unions
The growing global economic challenges mean that the management and the unions must work closely together. We have had an eventful year. There were many difficult, but crucial, things that had to be done. One of them was the re-tuning of the CPF. We also had to deal with the impact of SARS. Many workers, especially those in the hospitality and related sectors, had to take no-pay leave. Our national carrier, SIA, had also to embark on retrenchment and wage restructuring exercises. Our labour movement, especially the union leaders, had done well!
We will need to maintain and strengthen our tripartite relationship. It is something that has worked well for Singapore. This formula has been proven to be effective time and time again.
The management and unions in Keppel Offshore & Marine will need to work as one. The unions in Keppel Offshore & Marine must also work as one. This will strengthen the competitive strength of the company.
Significance of the First Family Day
Critical to the future success of Keppel will be the renewal of the workforce. This means that Keppel must attract good young people into the company. I am happy to be invited to this special occasion of the first Family Day of Keppel Offshore & Marine. I am told that there are more than 10,000 workers, engineers, management staff and their family members gathered here today.
The company had undergone some restructuring in the past years. Such events provide a good platform for all employees from the various parts of the company to come together to have some fun and to get to know each other. It offers the opportunity for the three unions in Keppel Offshore & Marine to strengthen their mutual understanding and cohesiveness. I hope it is the start of more jointly organized activities by all the three unions.
Working life in the shipyards can be hard.
Work starts very early in the morning in the shipyards. I am sure many of you here leave home before the sun rises. Your family members may still in bed when you leave for work. By the time you reach home, your young child may be getting ready to go to bed. It can be difficult to balance work with family life.
A Family Day like today is an important step in recognizing that we should spend time enjoying ourselves, especially with our family, even as we work hard to earn a living. I would urge the management and the unions to work together to improve the balance between work and family life. It will improve productivity in the long run. It will also help to attract more people to take up jobs in this sector.
I know that there are workers here today who are non-Singaporeans. You have also contributed to the progress of this company. Your families may not be with you today. This is the tough part of working overseas. I encourage you to make use of this opportunity to make new friends. Use this opportunity to learn about the culture here and strengthen your friendship with those whom you have gotten to know while you are here.
Let me conclude by wishing each and every one of you here success and good health in the new year! Enjoy yourselves and have a good day!
