28 February 1998

ADDRESS BY RADM (NS) TEO CHEE HEAN, MINISTER FOR EDUCATION AND SECOND MINISTER FOR DEFENCE AT THE SINGAPORE COMPUTER SOCIETY ANNUAL GALA DINNER AT HOTEL INTER-CONTINENTAL ON 28 FEBRUARY 1998 AT 8 PM

1. It is my pleasure to join you tonight at the Singapore Computer Society Annual Gala Dinner. The SCS has come a long way since it was first started more than 30 years ago. From a few technically-inclined individuals gathered together to share knowledge, the SCS has grown into a highly-regarded professional IT body.

2. I would like to take the opportunity of tonight's gathering to touch on a few issues that may be of immediate interest to the members of the society.

3. Asian countries are going through a difficult period, and we are also affected. Our economy will grow at a slower pace this year. The IT industry will similarly feel the impact of the regional economic downturn. For the last ten years the industry has grown by a compounded rate of 28 per cent per year; in 1996 revenues exceeded $9 billion. Such robust growth is unlikely to be repeated in the next year or two. However, beyond that the medium to long term prospects remain strong given the emphasis that has been placed on developing the IT sector by countries in our region.

4. While a softening in the regional market in the immediate future is inevitable, the Singapore domestic market, which accounts for about half of our total IT industry revenues, will continue to be strong. In particular, there will be no let up in the government's drive for key sectors of the economy to exploit IT.

5. As an example, in the next two years, the Ministry of Education will go full swing into the implementation of the IT Masterplan in Education. For FY98, the Ministry expects to spend $300 million on implementing the Masterplan, much of which will go into the procurement of computers, networks, software and courseware, as well as IT training for teachers.

6. Last year, the government ministries' expenditure on IT exceeded $500 million, and this level of investment will be maintained in the coming years. The government will also push ahead with its IT2000 initiatives, such as Singapore ONE.

7. Since its launch eight months ago in June last year, Singapore ONE has exceeded the targets set for the pilot phase in terms of the numbers of users and services provided. To take Singapore ONE into its next phase of development, the government will commit a further S$150 million in the next two years to build on the infrastructure and to enhance the breadth and depth of the services and applications.

8. The reason for this strong commitment by the government is because we believe that promoting the pervasive usage of IT is a long-term strategic investment that will provide a competitive advantage for our nation. The next two years will be a crucial period for Singapore. This is a time for us to build on our strengths, and reinforce our economic foundation. IT has a major role to play here. We will continue to invest in our people, strengthen Singapore's connectivity with the world, and develop Singapore into a centre for IT innovation.

9. We are confident that Asian countries will be able not only to recover from the current turmoil, but also to emerge stronger than before, once measures to get their economies back on track have taken effect. By the time the region is back on the growth path again, our investment in IT will put Singapore in good stead to better service a more competitive Asia.

10. By then, domestically, Singapore will also be a very much more sophisticated IT market. Every year, we will have 50,000 young people coming out of our school system, well versed in the use of IT. They will be accustomed to using computers in their studies, in the office, at home, and even at play. The consumer demand for IT-based services will grow very rapidly.

11. To meet this demand, IT manpower with the right skills is the key. The recently concluded 1997 IT Manpower & Skills Inventory Survey by the National Computer Board (NCB) has revealed some interesting findings. Firstly, there is a significant gap in IT manpower skills. System analysis and design, LAN administration, client-server computing, and database application development, are critical skills that need to be developed to meet industry demands.

12. Secondly, besides technical skills, other 'soft' or non-technical skills are increasingly becoming more important. Skills such as strategic planning, customer management, and outsourcing management are greatly valued by organisations.

13. The survey also points to a significant imbalance in the demand and supply of IT manpower. At the end of 1997, Singapore had just over 30,000 IT professionals, an increase of 15% over the previous year. The demand for IT manpower is expected to grow by an average annual rate of 11% over the next two years, that is, about 3,000 per year. In response, we are increasing the numbers trained in our tertiary institutions from 2,500 in 1997 to 2,800 in 1998. In the meantime, we will still require suitably qualified overseas graduates, including foreigners, as well as graduates trained initially in other disciplines.

14. I would like to urge IT companies and IT professionals to take advantage of this period to retrain and re-skill. You will find this investment worthwhile, for you will be well positioned to grow again in the next upswing of the market, and ride the next wave of the region's progress.

15. To realise our vision of an Intelligent Island, policies and plans alone will not suffice. We need to foster close rapport with the IT community and professional associations like the SCS, and work as a team towards our vision of excellence for Singapore. On this note, I would like to thank the SCS and your members for your strong support for the national IT initiatives all these years. Have a pleasant evening.