ANCHORED IN SINGAPORE HISTORY
Voice for the Industry
Made in Singapore
Positioning the Keel Blocks
A Remarkable Story of Growth
No. 1 Centre in Shiprepair
A Future in Industrial Engineering
A Marine Powerhouse
Confronting the Issues
ANCHORED IN SINGPORE HISTORY
Situated in the heart of an archipelagic region, Singapore is ideally suited to be a shipbuilder for regional trading, short-sea excursions and offshore oil and gas production. Hundreds have been built since boat building began on the banks of the Singapore River and the foreshores of Tanjong Rhu. Technically, it is well within the capability of Singapore shipyards to go for bigger units, as Jurong Shipbuilders did in the 1970s. But it was not to be her advantage, given the inadequate shipbuilding infrastructure, of land labour and equipment.
As equipment for sizeable ships is concentrated in the two key shipbuilding nations, South Korea and Japan, there is no comparative advantage in importing them into Singapore for fabrication. For the smaller range, however, the supply sources are wider. "The fact that we are an international procurement centre, the fact we can buy from European countries when their currencies are weak, that fact that we can source them out these are our strengths," said current Managing Director of Singapore Shipbuilding & Engineering, Boon Swan Foo.
The Second Wind
"The whole region, and especially Malaya, Indonesia and the Philippines needs ships, mainly coasters of a size between 500 and 3000 dwt. The present small wooden vessels which are used for the trade between the isles will in future not be able to meet the increasing requirements," commented the UN Industrial Survey Mission assessing Singapore's industrialisation potential. The authors of the report considered it a "paradox" that the building of large seagoing ships was non-existent in Singapore.
Construction was small-scale to fulfil essentially domestic requirements. In an interview with The Straits Times in 1965, then Director and General Manager of Thornycroft (Malaysia), John Wilde suggested it was the lack of marketing skills rather than technology which was hindering the development. "Our labour is good. Our materials are good," said Mr Wilde who referred to workers as "artists with timber" because teak and chengai were often used in the early construction.
Established in 1945, Thornycroft was among the select few which was geared for export. In 1965, the company beat 70 other shipbuilders worldwide to win a Royal Ceylon Navy contract worth $1.5 million for nine fast patrol boast. This led The Straits Times to dub it "The World Beaters".
But the expansion of trade, regional oil exploration and production in the late 1960s and 1970s beckoned entrepreneurs from at home at home and abroad. This gave birth to Singapore Shipbuilding & Engineering, Ocean Shipbuilding, Promet Shipbuilders, Malaysia Shipyards and North Shipyard. Soon Singapore became a primary source for supply ships, barges, anchor handling tugs, hydrographical vessels, pontoons, piers and general cargo ships.
The government further hastened the progress. Once again, Singapore turned to Ishikawajima-Harima Heavy Industries (IHI) which earlier launched Singapore into international shiprepair. Dr Goh Keng Swee, then Finance Minister, met IHI top executives in Japan in 1968. This led to the formation of Jurong Shipbuilders in December with Jurong Shipyard and Development Bank of Singapore as partners. At the official opening of Jurong Shipbuilders on March 29, 1972, then Prime Minister Lee Kuan Yew explained the logic behind the government's intention: "Shipbuilding is high on labour content. In some advanced countries, wages are going up faster than automation can cut down total wage costs. "So the building of standard vessels will move to those countries, like South Korea, Taiwan and Singapore, where wages are lower than those of the industrialised countries and where the workers are diligent and can be trained to high skills."
It was a proud moment for Singapore when the 14,000-dwt Neptune Ruby slipped into the water. The Neptune Orient Line-owned vessels launched by Mrs Lee that bright morning was the first ocean-going vessel to be built by Singapore.
The euphoria was short-lived. One-and-a half years later, the shipping industry was plunged into chaos when oil prices skyrocketed. Some ships were mothballed, others had to slowsteam as the world learnt to make do with less oil. Orders slowed. Like everyone else, Jurong Shipbuilders had to scramble for the dwindling share.
The then Joint Managing Director of Jurong Shipyard, Low Guan Onn, told workers on March 18, 1976, that Jurong Shipbuilders was still not viable despite having delivered 12 vessels with government subsidy since 1971. It had completed 11 Freedom vessels, the bulk for state-owned Neptune Orient Lines, and one 90,000-dwt tanker of a three-tanker.
The low productivity of its workforce did not help. "Daily you can see workers flout openly the orders of our foremen and engineers by attending their place of work half and hour late and leaving half an hour early," Mr Low told The Straits Times. This was in contrast with the highly disciplined Japanese workforce. As the shipping recession took its toll, Jurong Shipbuilders had to settle for small cargo ships and conversion jobs. In July 1976, it was merged with Jurong Shipyard for better economies and became known as the Newship Division.
Given the depth of the newbuilding slump, then Minister of State (Finance) Goh Chok Tong considered it fortuitous that Singapore had not channelled more resources to major new construction. Speaking at the first annual dinner for the Society of Naval Architects on Aug 19, 1978, Mr Goh said: "Last year, Singapore shipyards launched a total of 712 vessels totalling 437,000 grt. The same tonnage could be achieved by building four tankers of 111,000 grt each, with a much smaller labour force ad production facilities. If our shipyards had constructed 10 tankers of this size last year, Singapore would have been the third or fourth largest shipbuilder in the world." "But had we aspired to be in the top league in world shipbuilding, we would have today inherited a headache the size of VLCC."
As the order book thinned, even shipyards whose long history made them household names were forced to close. Among them were Sing Kong Seng, Weng Chan Engineering and Vosper Pte Ltd.
Staging A Comeback
Beaten but unbowed, Singapore shipbuilders have made a comeback. With the recovery in newbuilding orders, they have delivered container ships, product tankers, combination carriers, cement carriers and high-speed catamarans to the US, Middle East, Hong Kong and China. Shipbuilders are confident that with the buoyant economic growth in the Asia-Pacific, there are requirements for Singapore-made ships.
Jurong Shipyard is working on prototype tankers, container ships and multi-purpose ships for the regional market, which place strong emphasis on reduced costs and maintenance. Said present Managing Director K K Tan: "We reduced fittings that are not vital to a ship - the expenditure items. The scantling is heavier to ensure a long life." Simple in design and easy to maintain, Mr Tan said such vessels would have an economic life of 25 to 30 years.
Singapore Shipbuilding & Engineering (SSE) is casting its sights further. Said SSE's Managing Director Boon Swan Foo: "Owners here tend to be very price-sensitive. Competition, too is high. They have less sophisticated demands, so more yards can do the job." With a track record which includes missile corvettes for the navy, SSE is scouting for customers with custom-made requirements. Competition would be equally stiff, even though it rival would be different. But with "European standards at Asian prices", SSE is hoping to pull them in.
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