Distinguished guests, 

 

Ladies and Gentlemen, 

 

1.      A very good morning to all of you. Today is our inaugural Maritime Services Leaders Forum.  

 

2.      This is the first year that the Maritime and Port Authority of Singapore (MPA) has introduced this specific track for Maritime Services during Singapore Maritime Week. Why? We realise as the industry transforms and undergoes digitalisation and decarbonisation, services have become not just an important track to complement our offering as an International Maritime Centre, but a critical component that can decide the pace of our industry’s transition and transformation – be it digitising the supply chain or decarbonising towards the future of shipping. We need strong maritime services to “Transform for Growth”.  

 

3.      Maritime service providers i.e. the likes of ship financiers, marine insurers, maritime lawyers, arbitrators and ship brokers, need to work hand in hand with shipping companies to execute the vision of a digital and green future of shipping and supply chain. 

 

Maritime services in Singapore

 

4.      Now I will cover two aspects in my speech. First, on the landscape of maritime services in Singapore. Second, our ambition for the industry. I am excited to see that in the past years, due to our position as a global hub port and international maritime centre, we have attracted:

a) More than 30 leading international shipbroking firms,

b) Around 20 banks with international ship finance portfolios,

c) Over 30 law firms with maritime practice, and 

d) 10 International Group Protection and Indemnity (IG P&I) clubs, many of whom are here today.

e) In recent years, we have also cultivated over 40 MarineTech firms and more than 30 start-ups. 

 

5.      Despite the Covid-19 pandemic, we witnessed the continued expansion of the maritime services cluster in Singapore. For instance, on the marine insurance front, The Swedish Club is establishing a full-service office in Singapore. Shipbroking firms such as Howe Robinson, Lightship Chartering and Pareto Shipbrokers have also increased their presence in Singapore. We also saw insurance technology company, Concirrus, set up its Asian base in Singapore. 

 

6.      With the global maritime industry at the cusp of transformation for future growth in digitalisation and decarbonisation, we will need greater collaboration in three key areas.  Let me now elaborate and share our ambition in the areas of Green Financing, Regulation and Risk Management.

 

Green Financing  

 

7.      There is global interest in green financing. There are companies who want to offer green financing, and there is demand for green financing. Why then is the momentum not strong enough? To do this, everyone has to play a part. From MPA, we have launched the Maritime Singapore Decarbonisation Blueprint 2050 where green financing is one of the key focus areas. 

 

8.      We need investments to catalyse change. There is the R&D piece on future fuel, infrastructure development to cater to new green technologies as well as the construction, sale and purchase of green ships themselves. All these activities need capital. We have set aside $300 million to support decarbonisation projects and initiatives mapped out in the Blueprint. This is also the reason MPA and six private sector partners have all come onboard and contributed $120 million to set up the Global Centre for Maritime Decarbonisation, to accelerate the sector’s green transition. 

 

9.      Ruma from Google Cloud cited during the Marinetech Conference Opening Ceremony that there is an unprecedented number of VCs entering the Marinetech sector. $11.3 billion in 2021 - doubled from 2020. We have seen unprecedented interest in green financing. Green capital is looking for suitable industries and projects to invest in. Let me elaborate on some of the projects we have in Singapore:

 

10.     We have announced the decarbonisation of our domestic harbourcraft. Financing will be needed to transition the fleet to lower-carbon fuels in the near term, and full-electric propulsion or net zero fuels in the longer run. 

 

11.     Next, we have shipping companies with ocean-going vessels that will need to move towards greener vessels – not just big companies but also small and medium enterprises – even if it means starting with dual-fuel engines. 

 

12.     Third, we also need infrastructural investments to prepare and support the transition. 

 

13.     It is key that we aggregate, coordinate and better match-make. We need to gather likeminded players together with different risk appetites to match funds to the right green projects at the right time. That is the reason we are having this forum on maritime services with a focus on green financing.

 

14.    To do this, we must build an ecosystem that:

a) draws funding interests into shipping;

b) generates the right projects; and

c) provides platforms that connect these funds and projects. 

 

15.     With $300 million, we hope that this base will help kickstart momentum in Singapore. Our aim is to work with like-minded players to snowball the $300 million into multiplication of 4 times or 5 to 10 times – which will avail funds to companies with different risk appetites and projects of different risk levels. We are keen to work with industry players to offer a wide range of financing options including potential new models or mechanisms. We are engaging industry partners to explore co-creating such novel solutions, as part of developing Singapore as the Maritime Green Finance Hub of Asia. 

 

16.     Next, for the ecosystem to be effective, the various actors therein need to be speaking the same language on green shipping or a green finance taxonomy. We have started some efforts here, and we hope to see the fruits of the labour in the next one to two years. 

 

17.     There are currently a few additional initiatives underway. One example would be the Maritime Green Finance Industry Sharing Series, which aims to raise more awareness of green finance projects in Singapore. Singapore has also launched the Green and Sustainability-Linked Loans Grant Scheme (GSLS) that is administered by the Monetary Authority of Singapore. Together with SMF, we will also be bringing together key stakeholders at a roundtable to bring forward green financing solutions for our industry. The Singapore Shipping Association’s Shipping Finance Services Committee is also looking at ways to connect its members to maritime finance players. 

 

Regulation

 

18.     Second, on regulation. As we undergo transformation for growth, it is crucial that we review and update our regulations to ensure our relevance. Let me talk about our efforts in Singapore. There have been good developments in the legal and dispute resolution landscapes. For instance, in 2021, Singapore was amongst the first shipping and trading hubs to enact legislation for electronic transferable records like electronic bills of lading. We hope that we can get the support of as many players as possible to accelerate take-up, because eBL will only work if it is adopted globally by as many players as possible. To support these efforts, we have approved 3 consortiums to develop and trial eBL solutions across the container, dry bulk, and wet bulk segments, involving various supply chain partners.

 

19.     Additionally, Singapore is now ranked as the most preferred arbitration seat in the world, alongside London, according to the 2021 Queen Mary University of London White & Case International Arbitration survey. The Singapore Chamber of Maritime Arbitration has been focusing on initiatives such as virtual hearings, electronic signature of awards and an enhanced expedited procedure to ensure quicker and cost-effective resolution of disputes. 

 

20.     SCMA had also launched the inaugural Maritime Arbitrator Accreditation Program which was held in conjunction with the Singapore Institute of Arbitrators’ Fellowship Assessment Course. This will facilitate the professional growth and development of maritime arbitrators in Singapore. 

 

21.     Beyond arbitration, we also see the Singapore Convention on Mediation gaining traction. The Singapore Convention enhances the enforceability of cross-border mediated settlement agreements, and so far, 55 countries have signed the Convention, and 9 countries have ratified or approved the Convention. 

 

22.     We hope that these efforts will better position Singapore as a leading centre for maritime dispute resolution.  

 

Risk management

 

23.     Thirdly, risk management. The uncertainties of the world today continue to weigh on the risk management sector. How will the risk profile change with decarbonisation? For instance, any operational issues arising from adoption of alternative fuels such as delays or vessel-related problems may be relevant to insurers. With the rising emergence of digitalisation, how do we price cybersecurity risks? What is the outlook for the claims and premiums amidst geopolitical uncertainties? These are key questions that are keeping marine insurers busy. 

 

24.     Priority for the risk management segment would be to work with industry players to raise awareness and develop new capabilities in emerging areas of decarbonisation and digitalisation to better position the sector to deal with these developments. Let me take this opportunity to thank Lloyds of London on featuring MPA as a case study under the “Greener Maritime” chapter of its new climate action campaign. I would also like to thank Lloyds Asia for kicking off marine decarbonisation research that would involve Lloyd’s, MPA and academics to further support the sector. We certainly look forward to more collaboration in this area and beyond. 

 

Conclusion

 

25.     To conclude, Green Financing, Regulation and Risk Management will be the three key thrusts that MPA will be looking to partner key stakeholders to nudge the transformation of the maritime services sector for the future. 

 

26.     I look forward to having more partners onboard. In times of crisis, we see opportunities, and we definitely see a lot of opportunities arising in the last 2-3 years because the transformation of the sector has accelerated. As one of the speakers said on Day 1 of SMW, our strength is partnership in Singapore, and delivery. I hope that those of you looking at strategic partnerships – public, private – with the same ambition as us to not just talk, but execute and let momentum snowball, come forth to us with proposals on the way forward.  Only then, we have a chance for global solutions to the global challenges we are facing as one world, as one earth, together.