RE-LOCATION OF MANUFACTURING PLANTS BY FOREIGN INVESTORS (Particulars)

Mr Chng Hee Kok asked the Acting Minister for Trade and Industry how many foreign investors had re-located their manufacturing plants from Singapore in the years 1983, 1984 and 1985.

The Acting Minister for Trade and Industry (BG Lee Hsien Loong): Mr Speaker, Sir, in the last few years, leading international companies which have relocated at least a part of their operations elsewhere include General Electric, Philips, Hitachi Consumer Products, NMB, European Standard Electronics, Hewlett Packard, National Semiconductor and Seagate Technology.

Most cases involve transfer of Singapore operations to countries which have cheaper and more plentiful supplies of labour. Fortunately, most of them have retained or diversified into higher value operations in Singapore. Some, however, have closed their Singapore plants and consolidated their activities here back to their home countries.

Relocations involving labour-intensive operations are perhaps inevitable. We can no longer compete on the basis of cheap, unskilled labour. But companies engaged in high value and skill-intensive operations, which provide good jobs for our people, must not be priced out of the international market because of increases in domestic costs, particularly wage costs. To attract and retain these companies, we must maintain our cost competitiveness. We must ensure that even when companies relocate the labour-intensive portion of their operations overseas, they can upgrade and retain their activities in Singapore, either through automation or by introducing new and more sophisticated product lines.

Mr Chng Hee Kok (Radin Mas): Sir, in view of its importance to our economy, will the Acting Minister include a report on this item in future Economic Surveys? At the moment, the Economic Survey does not include a report on loss of investments to Singapore.

BG Lee Hsien Loong: Mr Speaker, Sir, we will consider that, and we will present it in the form of a progress of the upgrading of our economy.