Milken Institute Asia Summit 2024 - Impactful Ideas: Purposeful Action

This article was adapted from my speech at the 11th annual Milken Institute Asia Summit 2024 on 19 September 2024.

The theme of the 11th Milken Institute Asia Summit 2024, "Impactful Ideas: Purposeful Action", resonates deeply with Singapore.

As a small country with neither large hinterland nor abundance of natural resources, our success has been a result of our openness to ideas, our willingness to try, and our commitment to action. We will preserve and deepen these strengths as we chart the way forward for Singapore – to look for better solutions; and to take bold steps to pursue new ambitions.

Even as we do so, there are profound shifts in the global landscape. 

First, climate change.

This is an existential issue for the world. We are already seeing more extreme storms, floods, wildfires and heat waves, with 2024 set to be the world’s hottest year on record. To mitigate climate change, we need to limit global warming to 1.5 degrees Celsius above pre-industrial levels. But global temperatures are already 1.1 degrees Celsius higher and are continuing to rise.

Unless we can quickly mobilise efforts to turn ideas on adaptation, mitigation and decarbonisation into action and fruition, the impact on economies, societies, and physical geographies will be profound.

Singapore is keenly aware of this. While we are small and only contribute 0.1% of global emissions, we have committed to do our part, to peak emissions before 2030 and achieve net-zero by 2050. We are doubling down on a number of fronts:

• Working with our industries to reduce their primary emissions. This includes the adoption of greener technologies as well as piloting the use of carbon capture and storage solutions.
• Taking steps to transform our energy mix to rely more on greener power. We have recently raised our target for low-carbon energy imports from 4 gigawatts (GW) to 6 GW by 2035, and awarded conditional approvals to 9 projects thus far, with 5 of them advancing to conditional licences. 
• Investing in coastal protection measures to shore up our resilience against the effects of rising sea level.

However, our efforts alone will not be sufficient as climate change affects everyone. We must ensure that Asia, and even the rest of the world, also get to net-zero. We are keen to work with institutions, industries and governments in Asia and around the world to facilitate the carbon transition, in order to avert the worst impacts of climate change.

Second, demographic pressure and public health.

Today, about 10% of the world’s population is aged 65 years or older. For some countries such as Japan, South Korea, Germany and the UK, that proportion is already much higher, and set to accelerate even faster.

If not managed well, this could place severe strain not only on workforce growth, but also healthcare systems, pensions, and social support systems. But if we do it right, we can enable our seniors to remain active and healthy for longer, contribute to society, and live life to the fullest.

Singapore has therefore developed an Action Plan for Successful Ageing to mobilise nation-wide efforts to turn ideas on active and healthy ageing into fruition, so that we can not only lengthen the lifespan of our seniors, but also their ‘health-span’.

Last year, we took a further step and launched our Healthier SG strategy, marking a decisive shift from reactively caring for those who are sick to proactively preventing or delaying individuals from falling ill. We aim to anchor each resident with a family doctor, who will work with community partners and healthcare clusters to develop a personalised health plan to support their health journey over time, with recommended screenings, vaccinations and social activities.

It will require both continuity and commitment to reap the benefits of Healthier SG to improve population health, reduce disease burden, and ensure fiscal sustainability. It is still early days, but we hope that Healthier SG can serve as a pathfinder and show the way to address population ageing and rising burdens of non-communicable diseases faced by many countries.

Third, disruptive technologies, and in particular AI.

Thanks to faster computing, the proliferation of big data and deep learning, the pace of technological advancements have accelerated. 

ChatGPT is a good example of this. When GPT-2 was released in 2019, it had 1.5 billion parameters. Just one year later, GPT-3 was released with 175 billion parameters, and was capable of understanding context, producing more human-like text, generating code, solving problems, and even displaying reasoning abilities. Today, GPT-4 has taken the model even further, with not just the ability to engage in language-based tasks but also process both text and images.

These technologies hold both promise and peril. For economies like Singapore which do not have the benefit of demographic advantage, AI offers the potential to overcome both labour and productivity constraints. But at the same time, we recognise that AI has the potential to disrupt jobs and cause anxiety among workers. Without proper regulatory guardrails, there will also be fears about model quality and fair use.

This is why Singapore had developed its National AI Strategy and updated it last year, so that we can address risks and concerns from the potential disruptions, abuse and mismanagement of AI, while seizing the potential of AI to unlock the next frontier of economic growth. We hope that this will also strengthen our value proposition as an active, constructive and reliable contributor to global AI developments, and position Singapore at the forefront of AI.

Public-private partnerships play a key role in turning impactful ideas into purposeful action. To capitalise on these partnerships, we must ensure that we have the right enablers in place. I will elaborate on four of these: capital; talent; standards; and international collaboration.

Capital

Capital is not the only pre-requisite for innovation, but it certainly is one of the most critical.

For example, in the area of climate change, it is estimated that Asia will require about US$1.7 trillion dollars in climate and infrastructure investment annually through to 2030. To meet the capital required, we need to catalyse green and transition finance for the region.

Today, there are a number of reasons why there is insufficient capital to fund such projects:

• There may not be sufficient capacity and expertise to prepare and develop projects to a stage that is bankable.
• Such projects may also carry a high level of risk, especially in emerging economies with greater uncertainties.
• Some projects may face long lead times to implement, and in securing the necessary permits.

Recognising this need, Singapore announced last year that we will set up a new blended finance initiative – the Financing Asia’s Transition Partnerships, or FAST-P, with a target size of US$5 billion dollars.

Governments, development finance institutions, and philanthropies could provide concessional capital. Multilateral development banks can provide technical assistance.

These efforts will reduce project risk and improve bankability, and we hope, catalyse multiples of private commercial capital to finance transition and marginally bankable green projects in Asia.

Talent

Next, we need to develop the right bench strength of talent to drive research and development. Let me illustrate this with biotech, which we believe can help unlock treatment in specific disease areas such as cancer and neurodegenerative disease, as well as in new therapeutic modalities such as nucleic acid therapy, immunotherapy, and cell and gene therapy.

One of the key areas we have identified is drug and venture development talent, and we are taking steps to address this. According to a 2022 report, we expect the talent gap in Singapore for pre-clinical biotech companies to narrow from 110 to 76 in 2032, but the gap for clinical-stage biotech firms will widen from 44 to 123 within the same period.

The Helix Immersion Programme is a one-year on-the-job training programme that allows biomedical research and academic professionals to gain industry-relevant skills. This programme aims to place and train 100 fellows by 2025.

Another programme is the Innovation and Enterprise Fellowship Programme, which aims to grow the pool of talent who can support the commercialisation of deep-tech research and bring nascent technologies to market. To date, we have attracted more than 90 fellows since its launch in 2020.

Through these programmes, we hope to strengthen the talent pipeline in Singapore, so that we not only have a good base of research talent but also the expertise crucial to later stages.

Standards

Another key enabler is governance and standards.

Even as we push the bounds of innovation, we ought to give citizens, consumers and governments the assurance that these innovations are done in a safe, trustworthy and responsible manner.

This is why we had recently promulgated our Model AI Governance Framework for Generative AI. This Framework aims to ensure a fit-for-purpose regulatory environment, by setting out nine dimensions, including accountability, data, trusted development and deployment, and incident reporting. With this Framework, we can foster a trusted ecosystem where we can embrace AI with confidence, provide maximal space for innovation, and harness AI for the Public Good.

International collaboration

Last but not least, we need to reinforce regional and global cooperation:

• Reinforce the shared responsibility among nations on global issues, such as on climate change, ageing, and disruptive technologies. 
• Establish common goals that each of us can measure against, so that we can not only coordinate our efforts, but also nudge each other to progress. 
• Evolve frameworks by which countries can work together, and provide certainty to investors and companies to catalyse the flow of capital, talent and other resources across countries.

The Paris Accords, for example, has allowed 195 countries to align the goal to limit global warming to well below 2 degrees, with an aspirational target of 1.5 degrees. This has formed the basis by which countries commit to Nationally Determined Contributions, their emission reduction plans and climate adaptation strategies. It also establishes a system of monitoring, reporting and verifying the actions taken by countries. Without the Paris Accords, it will be challenging for countries to pace their decarbonisation efforts, especially given that the cost implications are not trivial. 

One specific area of cooperation which Singapore is deeply invested in is trade cooperation. Geopolitical tensions, particularly between the United States and China, have resulted in a vicious cycle of subsidies, tariffs and export restrictions, to compete for critical minerals and technological advantage in sectors ranging from semiconductors, clean energy and telecoms to electric vehicles, AI, and quantum computing. This has placed tremendous strain on the multilateral trading order. As a small country that is critically reliant on trade and a stable global environment, we are very concerned about how this will impact our ability to continue doing business with the world, and for the world to trade with one another.

Despite challenges facing the global economy, ASEAN remains a bright spot. 

We are on track to conclude our negotiations on the upgrade of the ASEAN Trade in Goods Agreement (ATIGA), by the first quarter of next year. It will be a high-quality, forward-looking upgrade that will advance ASEAN as an integrated market.

We have also substantially concluded the negotiations for the upgrade of the ASEAN-China FTA 3.0. This will further deepen economic cooperation between ASEAN and China, particularly in emerging areas such as digital economy, green economy, and supply chain connectivity.

Through these agreements, we can catalyse the flow of trade and investment within ASEAN and with key economic partners. This will allow us to unlock the potential of ASEAN, which is projected to become the fourth largest economy in the world by 2030.

Over the past couple of years, Singapore has participated in new plurilateral groupings that have emerged, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (or CPTPP) and Indo-Pacific Economic Framework for Prosperity (or IPEF). These are important platforms for Singapore to enlarge our network of trading partners, evolve new trade cooperation models, and establish connections with new markets. 

We have also advocated for a ‘variable geometry’ approach to cooperation, by setting up open and flexible mechanisms for countries to join whenever they are ready. The WTO Joint Statement Initiative (JSI) on Electronic Commerce that we have convened with Australia and Japan is one such initiative. 

In this way, we can continue to strengthen the rules-based order in trade and economic cooperation, and yet open new avenues for more investments and progress in areas such as the green and digital economy.

Conclusion

As we confront the transition towards a low-carbon world, address the challenges of an ageing demographic, and leverage the potentials and mitigate risks of disruptive technologies, Singapore stands ready to work with both public and private partners to brainstorm bold ideas for change and experiment with possible solutions.

This includes mobilising the necessary capital, crowding in the right talent, promulgating strong governance and balanced standards, as well as promoting regional and global cooperation.

This way, we can build a more sustainable, inclusive and innovative world for growth, value creation and social uplift.