Dr John Keung, CEO BCA,

Mr Kwee Liong Keng, Immediate Past President REDAS,

Distinguished guests, ladies and gentlemen,

1 Happy New Year and a very good morning to you.

Continued Strong Construction Demand Expected in 2008

2 The building and construction sector is enjoying its strongest growth since the last boom in the mid-90s. Last year, driven by a strong private sector demand, the total value of contracts awarded reached $24.5 billion.

3 The robust construction demand is expected to continue into this year. For 2008, new construction demand is projected to reach between $23 billion and $27 billion. The private sector is again expected to account for the bulk of the construction demand, mostly from residential and commercial developments. From the public sector, public housing, amenities and infrastructure projects such as MRT Downtown Line and Marina Coastal Expressway will also contribute towards this demand.

4 This strong showing in demand will again translate into high construction activity over the next two years and more. The strong construction growth will be welcomed amidst expectations of a moderation in overall economic growth. Similar to last year, construction GDP growth rate is expected to be sustained at double-digit for 2008.

5 However, a high construction demand will continue to exert pressure on resources. As announced last November, the Government is taking proactive measures to ease the pressure on construction resources and the capacity crunch.

6 First, various Government agencies have, for a start, identified more than $2 billion worth of public sector projects that can be rescheduled to 2010 and beyond. All ministries are currently combing through their list of projects to identify more projects for rescheduling. Second, the Government has introduced several manpower-related measures to ensure adequate supply of construction manpower. This includes increasing the testing capacity of BCA’s Overseas Testing Centres to facilitate the entry of foreign workers, exempting experienced foreign workers from man-year entitlement requirements, raising the dependency ratio and S-pass quota, and expanding the list of acceptable foreign qualifications for resident engineers and site supervisors. Third, the Government is working with the industry to expand the capacity of existing construction firms and to attract new entrants, especially those with experience in specialist trades.

7 On top of these, BCA will continue to make available timely and essential information on construction demand and costs to enable the industry to better gauge the circumstances and reduce uncertainties. This seminar is one of the means to update and inform the industry of the latest situation. We will continue to monitor the situation closely and work with the industry to ensure adequate resources and maintain Singapore’s cost competitiveness.

A Sustainable Built Environment for Singapore

8 The high level of construction demand and work in the next few years will no doubt keep the industry busy. This buoyant period is also the best time for us to emphasise forward-looking strategies, one of which is the role and responsibility of the industry towards making our built environment a sustainable one.

9 Sustainable development is an issue that has taken on increased importance and urgency. Climate change and global warming are increasing environmental concerns that we can no longer overlook. As creators and custodians of the built environment, we have a part to play in promoting and shaping sustainable development.

10 Recognising this importance, the Building Control Bill passed in Parliament last September included new provisions to promote environmentally sustainable development. All buildings and existing buildings undergoing major retrofitting works will be required to meet the Green Mark certified standards when the legislative requirements become operative in a few months’ time. So far, over 70 buildings have been Green Mark certified, and many more are in the pipeline for assessment. This is an encouraging sign. We hope to see more environmentally friendly buildings with greater energy and water efficiency, and constructed using sustainable methods and materials.

11 In line with this, BCA formed a Sustainable Construction Steering Group last year, consisting of various public agencies and industry bodies, to spearhead concerted efforts in adopting sustainable construction in Singapore. I am pleased to note that the Steering Group is in the midst of implementing its Sustainable Construction Roadmap, which focuses on two key aspects: one, designing for sustainable construction, and two, using recycled materials in construction. Allow me to update you on the recent achievements and plans in these areas.

Designing for Sustainable Construction

12 The Sustainable Construction Steering Group has been looking at technical and regulatory issues concerning steel construction and the more efficient use of concrete, while mindful of the need to maintain high standards of safety.

13 In the area of concrete usage, BCA will be introducing new guidelines for the usage of high-strength concrete later this month. Industry consultations are also ongoing to find the most effective and objective measure of concrete usage.

14 To facilitate wider adoption of steel usage, the Sustainable Construction Steering Group has completed a guidebook on the use of steel in construction, with emphasis on the fire protection requirements of steel structures. This will be launched later this month. Works are also ongoing to develop guidelines to allow greater flexibility in the choice of steel without compromising structural safety.

Use of Recycled Materials

15 To further reduce the amount of concrete used in construction, we can also maximise the use of recycled materials. The benefits are obvious: better supply resilience, reduced amount of waste going to the landfills, and lesser negative impact on our environment.

16 The Sustainable Construction Roadmap places emphasis on identifying an adequate supply of quality recycled aggregates for use in construction. Together with the Waste Management and Recycling Association of Singapore, BCA, public sector agencies and industry bodies are developing a framework with this end objective in mind. A guidebook on selection and usage of recycled materials will also be launched soon.

17 I understand that there are also various R&D efforts focusing on the use of recycled construction materials. These include the use of recycled aggregates for structural applications, and the use of other recycled materials such as dredged material and industrial slag to manufacture engineered aggregates for non-structural applications. This is encouraging. I urge more of you tap on the “MND Research Fund for the Built Environment” and undertake research projects with improving sustainability in mind.

Supply Resilience

18 Besides being environmentally friendly, sustainable construction will also enhance our resilience against supply fluctuations in basic construction materials.

19 It has been a year since Indonesia banned the export of concreting sand. Today, I am pleased to say that our efforts to diversify our supply sources and to promote greater use of alternative construction materials and methods have paid off. Concrete prices stabilised quickly after an initial spike, and the construction boom last year was hardly affected. This, I must say, is concrete testimony of the resilience and versatility of our construction industry.

20 As the concreting sand supply situation has stabilized, the assistance scheme that BCA implemented last year to co-share the risk of bringing in sand from distant sources will be discontinued. This is based on feedback from the industry that the scheme is no longer necessary. I read this as a positive development as it shows the confidence level of the industry in the supply situation.

21 We must nevertheless look into ways to ensure that our supply resilience of essential construction materials will be sustained over the longer term. BCA is now looking into introducing a licensing scheme for importers of these materials. Licensed importers will then have to ensure the quality of our imported materials for building safety and have plans in place to ensure supply resilience. BCA has consulted the relevant industry players and is in the process of finalising this proposed scheme.

Conclusion

22 As the real estate and construction industry advances and prepares itself for the opportunities and challenges ahead, it is important to acknowledge its contributions to nation-building and in Singapore’s development as a distinctive, global city. The quality built environment that we enjoy today could not have been achieved without an effective and proficient construction industry. Let us continue to work together, as a partnership among industry, government and the people, towards furthering our reputation as a distinctive, global city.

23 With this, I wish you all success in the year ahead. Thank you.

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