Good morning,
Mr. Ch’ng Jit Koon, Chairman, Pan United Corporation Ltd
Mr Henry Ng, Executive Chairman, Pan-United Marine Ltd
Mr. Patrick Ng, CEO, Pan United Corporation Ltd
Mr Lim Chin Siew, Executive Secretary, SMEEU
Mr Lim Chee Khian, Chairman, SMEEU, Pan United Branch Committee
Comrades, Distinguished Guests, Ladies and Gentlemen
I am happy to join you today to celebrate our country’s 39th National Day.
First, my congratulations to the Pan-United Group of companies. Pan-United started as a family-owned small ship chandler in 1958. The company ventured into regional bulk shipping in the '70s, and subsequently the marine industry in the '80s. They were then listed on the Singapore Stock Exchange in 1993. Today, Pan-United is a diversified industrial conglomerate with interests spanning the Asia Pacific region. It is heartening to note that Pan-United has also ventured as a partner of the Singapore Changshu Development Company Pte Ltd (SCD) in China. One of the key investments is in the Changshu Xinghua Port Co Ltd (CXP) which is a leading port terminal operator in Eastern and Central China along the Yangtze River. It is the fastest growing port and is ranked 7th busiest river port in China with Shanghai Port being the first. Many people felt that the port investment was a mistake, but its success today shows that if there is a will to succeed, then success will come. The port is also one of the major distribution hubs for pulp & paper and steel product in lower Yangtze River Delta Growth Region.
The rise of Pan-United mirrors the emergence of Singapore from the third world to the first. Along the way, there have been ups and downs. Pan-United successively navigated through the cycles of business.
Last year was a very difficult year for Singapore. We were in a recession and our economy contracted by 2%. But it was a good year for the marine industry. I’m glad to note that Pan-United Corporation’s 2003 Revenues totaled about $328 million with net profit for the year at about $21 million. Overall, the industry grew by over 40% in 2003 and it has maintained its momentum, registering a growth of 13% in the first half. This good performance of the marine industry shows that despite an overall economic downturn, the industry has opportunities to be tapped.
Wage Restructuring
It is important to use this thriving period to strengthen ourselves to meet the global competition. We must expect keen competition from our immediate neighbours, and China and India. They have lower wage costs. We have the advantage of higher productivity. Nevertheless, we must restructure our wage system. Wage restructuring does not mean an across the board wage cut. What it means is to keep our fixed wages down, so that our prices can be made competitive. Then when our companies are successful in getting more business, and earn higher profits, our workers get a fair share in variable pay. Wage restructuring also means linking workers’ pay more closely with their performance, and making it depend less on his seniority in the job.
A wage system that allows costs to be adjusted in tandem with the market also means better jobs security for workers. Union leaders need to work with management to explain to their members the rationale for the wage restructuring, and help the members adjust. For variable wages to work, trust is critical. Workers need to be sure that the system is fair. Therefore, employers must be open with their workers. They must keep workers informed on how the company is doing, and work with unions to address workers’ concerns.
Restructuring is not a problem peculiar to Singa¬pore. The developed European countries like France and Germany are finding it hard to adjust to the entry of new EU members, like Hungary, Czech Republic and Estonia. Jobs are flowing out to these new EU member countries, where taxes are lower and labour markets more flexible. The developed EU members are also under pressure to reduce their taxes, and to drop rigid labour practices like the 35-hour work week.
Work-Redesign and Occupational Safety
Some analysts have projected good growth for the industry. They estimate that there will be 200,000 people working in Singapore’s maritime industry by 2018, up from today’s total of 116,800 people. This shows the vast potential in this industry. NTUC, WDA and industry players have taken an active role in looking into ways to attract more locals to join the industry. This has led to job matching and job redesign collaborations, with the aim of dispelling the misconceptions of the marine industry as dirty and dangerous. In this aspect, the industry needs to do a thorough examination of current work processes so as to re-design the jobs in the yards to streamline processes and work effectiveness to attract more Singaporeans into the industry. By the same token, in view of the recent spate of industrial accidents and the unfortunate fatalities at Keppel Shipyard, it has become a greater imperative to ensure that safety regulations and standards are observed and overall worker and yard safety kept at its highest standards. This will aid in promoting overall worker morale and productivity and translate into higher returns for the company.
Finally, I know that the Pan United recognised the Union earlier this year. The Branch Committee was formed last month. I urge the management and the newly formed union committee to embrace a culture of close teamwork and harmonious labour management relations. This will be even more important amidst the challenges and changes in the new world economy. By working together, we will bring Singapore to even greater heights, and assure ourselves of a bright future for many years to come.
I wish you a Happy National Day.
