Deputy Prime Minister and Minister for Home Affairs Mr Wong Kan Seng
The Honourable the Chief Justice Chan Sek Keong
The Honourable Justice V K Rajah
Mr Huang Yong, Minister Counsellor of the Chinese Embassy
Ladies and Gentlemen
It gives me great pleasure to be here this morning to open the Singapore Academy of Law’s seminar “Singapore: A Bridge for Chinese Businesses”.
Excellent Singapore-China Relations
2 Singapore and China enjoy excellent relations. Although we established diplomatic ties only 16 years ago, we have since deepened our ties in many areas, spanning economics, politics, culture, education, science and technology. Since 2003, we have set up a Joint Council for Bilateral Cooperation (JCBC) that brings all our bilateral cooperation under one roof. At the second JCBC meeting last September, both countries signed an MOU to strengthen human resource partnership.
3 Economic relations have also grown steadily. China was our 4th largest trading partner in 2005, with bilateral trade reaching a record S$67 billion. This is an increase of about 26 per cent over the corresponding period in 2004. Bilateral trade grew seven-fold in the course of a decade, from S$7.6 billion in 1994 to S$53.3 billion in 2004.
4 This impressive growth is helped by the excellent Government-to-Government ties between our two countries. Last month, Senior Minister Goh Chok Tong visited Beijing, while the Minister of National Defence General Cao Gangchuan visited Singapore. Minister Mentor Lee Kuan Yew will be visiting China in a week’s time. The many high-level exchanges and platforms underscore the commitment of our governments to deepen and widen Singapore-China relations. This has facilitated and encouraged closer cooperation between our business communities. Today, there are many joint commercial ventures undertaken by Singapore and Chinese companies in a wide range of fields.
Singapore - a Bridge to Economic Globalisation
5 Singapore can be a gateway of choice for many Chinese companies who are now looking to internationalise. The companies can capitalise on our pro-business environment and our excellent business infrastructure, with over 7,000 multinational corporations or MNCs already in Singapore. They can tap onto our growing network of Free Trade Agreements or FTAs that provides preferential access to the major markets of the world. Singapore and China have agreed to negotiate a bilateral FTA under the larger umbrella of the ASEAN-China FTA. To date, over 1,600 Chinese companies have established a presence in Singapore, while more than 90 Chinese companies have listed on the Singapore Exchange. With the eventual establishment of the Singapore-China FTA and the larger ASEAN-China FTA, businesses from China to Singapore and ASEAN, and vice versa would increase exponentially.
6 Today’s seminar represents another step forward in our two countries’ journey together. It brings to fruition one of the areas we agreed on at the 2nd JCBC, as part of our efforts to strengthen human resource partnership. The Singapore Academy of Law has assembled a team of experts from the legal, investment and business fields. They will share their experiences in the management of cross-border commercial transactions. They will also share how you can benefit from using a commercially pragmatic law to avoid pitfalls in your regional business transactions. The availability of such expertise is one more of the benefits in using Singapore as a gateway.
7 Conducting business in foreign lands is always a risky venture for any company. The language is different. The culture is different. The challenges can be tremendous. Disputes can and do take place. Of course, within our own cultures, we have our own mechanisms for dealing with disputes. This often allows us to resolve the disputes without needing to go to arbitration or to court. However, where there are cross-border transactions, there is a meeting of different cultures and unfortunately, not always a meeting of minds. In such situations, recourse to the law is needed, and it is important that a dependable law governs the transaction. The ability of the lawyers to understand the culture and mindset of the clients is also vital. It creates a comfort zone within which clients can share their real concerns. It helps to ensure that the best possible steps are taken for the clients.
8 Increasingly, businesses are also realising that there are significant differences between the laws and legal systems of countries. Neutrality and efficiency of the legal system that administers the governing law have also become important considerations for businesses. Neutrality gives confidence that the decision will be impartial and made solely on the merits of the case. Efficiency ensures that time and money will not be wasted in an ever increasingly fast paced commercial world.
9 Singapore commercial law and the Singapore legal system is able to cater to the multi-facets required in cross-border transactions. While companies naturally seek to use their own laws in commerce, this may not always be possible in cross-border transactions. In such situations, parties require a neutral yet effective law to govern the dispute. Singapore law can fill this requirement well.
10 I understand that the Singapore Academy of Law has set up a website on SingaporeLaw. In it are short articles capturing the essence of Singapore commercial law. It is now in English, but a Mandarin version of this website will be out shortly. After this seminar, you might find it worthwhile to take a look. It would help you to know the principles on which Singapore commercial law is based.
11 I trust that the seminar will be a useful session. I believe that much will be learnt from the sharing of both panellists and participants. On this note, I wish all of you here a very interesting and fruitful seminar.