SPEECH -19 June 2009

REMARKS BY MRS LIM HWEE HUA, MINISTER IN THE PRIME MINISTER’S OFFICE AND 2^ND MINISTER FOR FINANCE & TRANSPORT, SINGAPORE, AT THE WORLD ECONOMIC FORUM (WEF) ON EAST ASIA, 19 JUNE 2009, 1.45 PM, SEOUL, REPUBLIC OF KOREA

"Sustainable Transportation in Asia: Within Reach?”

Distinguished Delegates,

Ladies and Gentlemen,

Introduction

1 First let me thank the organizers for inviting me to participate in this very important forum. I am honoured to be here today with many distinguished experts who have come to share their knowledge at this forum. It is indeed an excellent opportunity for me to also learn from you on your experience and expertise.

2 Today, I am pleased to share with you some views on sustainable transportation based on in the experiences of Singapore.

Firstly the need for sustainable transportation

3 From Singapore Government’s perspective, transportation is without a doubt a critical factor underpinning economic development in the globalised economy. People and goods are moved within and across borders through various modes of transport, whether by land, sea or air. Notwithstanding the current global economic downturn, States continue to strive to not only turnaround and recover from the present economic situation, but also aim to raise their ability to support their growing populations which usually involves enhancing infrastructure, promoting local and international tourism and trade, and ultimately improving the quality of life. The lifestyles and expectations of our global population are becoming more sophisticated and diverse. The need for good transportation systems and networks to support these developments, while increasingly necessary, could also impact our environmental quality if we are not vigilant.

Key challenges faced

4 Asia, as a rapidly-growing region, faces these similar challenges and Singapore is no exception, especially in view of our limited land size and lack of natural resources. We have to ensure that we grow in a sustainable manner, and to do so, it is necessary to plan ahead in a pragmatic, integrated, cost-effective yet flexible manner to ensure that our transport system is able to meet two important objectives: to lower the environmental footprint and to enable more efficient travel.

Sharing our policy themes

Promoting public transport

5 With a small land space and densely built up regions, the use of public transport is central to Singapore’s quest for a high quality and sustainable living environment. Our public transport network comprises an integrated array of buses and a mass rapid transit (MRT) train system. One approach which we have adopted is to promote the wider use of public transport, and thereby reducing the reliance on the use of cars, as we simply are not able to build enough roads and expressways. Moreover, public transport is also much more energy efficient than travel by cars.

6 We continue to invest in, enhance and promote the use of public transport. Currently, our public transport system carries about 6 out of every 10 trips and we aim to increase this to about 7 in 10 trips by 2020. To this end, we are working towards providing an extensive rail network and intensifying land use around rail stations. The design and alignment of road and rail infrastructures are planned to minimize adverse impact on environmentally sensitive areas and to preserve the natural environment wherever possible. The Singapore Government will be investing S$40 billion towards doubling our urban rail network from about 32 km per million population today to 51 km per million population by 2020. Within our city, we will aim to have a comprehensive MRT network such that there will be a station within a 5-minutes walking distance.

7 Equally important is the inter-connectivity of rail and bus services. We are building more integrated public transport hubs that are co-located with retail and commercial activities. This will help shorten waiting times, allow for more comfortable travel and transfers, and provide added convenience. The further advantage is that commercial centres are decentralized, thus reducing the need to travel and consequentially easing peak hour traffic congestion caused by traffic flowing in and out of the city centre.

Restricting the growth rate of private transport – flip side of promoting public transport

8 Over the last few decades, Singapore has implemented several measures around two themes – to regulate the growth of our vehicle population and to manage road usage. We have put in place a Vehicle Quota System and have imposed ownership taxes to ensure that the car population is controlled at a level consistent with our road network capacity. Potential vehicle buyers need to bid for a Certificate of Entitlement which entitles them to own a vehicle for a fixed number of years. The Government then controls the growth rate of the vehicle population by limiting the annual quota of certificates. This measure has effectively dampened the vehicle population growth by half from 6% to 3%, and we are targeting to reduce this further to 1.5% in the future.

9 On usage control, we have employed congestion pricing as far back as 1975, with a manual system covering only the Central Business District, and progressively expanded to cover all congested roads. This was made possible by the introduction of an automated electronic charging system which we call the Electronic Road Pricing system. The ERP system works by erecting charging gantries on roads prone to congestion and levies a charge on motorists when they drive under these ERP gantries. The charges vary according to time and location, giving us the flexibility to directly manage the demand for specific roads and time slots, hence maintaining traffic speeds on a road within an optimal speed range.

10 To prevent wastage and over-use of energy, the Government sets energy prices according to market principles and regulates fuel duty as a form of general vehicular usage charge. Coupled with our policy of not subsidizing fuel usage, commuters and transport companies are hence motivated to use fuel wisely.

Encouraging fuel-efficient and ‘cleaner’ vehicles

11 Concurrently, Singapore has a series of initiatives aimed at improving resource efficiency by reducing fuel consumption and adopting fuel efficient technologies for both private and public transport. One example is the introduction of the Fuel Economy Scheme (FELS) in 2003 as a voluntary program that provides buyers of passenger cars with fuel economy information at the point of sale. We have since made it mandatory for automobile retailers to provide such information on passenger car and light goods vehicles to consumers.

12 To encourage motorists to switch to ‘green’ vehicles such as hybrid and compressed natural gas vehicles, we have introduced Green Vehicle Rebates for hybrid and electric cars in January 2001 and extended to natural gas vehicles from October 2001. These rebates allow such green vehicles to be registered at lower taxes compared to conventional vehicles and help narrow the price differential for the consumers.

13 To reduce particulate matter (PM) emissions, Singapore introduced ultra low sulphur diesel in December 2005 and mandated that from October 2006, all new diesel vehicles must be Euro IV compliant. Over time, as the diesel vehicle population is replaced and renewed with cleaner diesel vehicles, we expect to see significant improvement in the level of PM emissions, given that about half of the PM emissions in Singapore are from diesel vehicles.

Conclusion

14 In summary, I am confident that sustainable transportation in Asia is within reach. This effort can be achieved through a combination of embracing the issues, raising awareness, investing in the most practical solutions and willing to take a forward-looking perspective. The close partnership between Government, industry and commuters is crucial to achieving a common vision to ensure sustainable transportation, not just for our present but also for our future generations.

15 Thank you.

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