Featured among the Asian Tigers, the city-state has one of the busiest ports in the world and a vibrant financial market, besides giving examples of innovation in sustainable urban planning
Upon arriving in Singapore, newcomers often get perplexed. Modern skyscrapers, wide boulevards, a large industrial complex, one of the busiest and most strategic ports in the world, a major global financial center. Yes, at this rich, cosmopolitan and innovative Asian city-state, practically everything is superlative. For the local government, however, that is not enough. They are obsessed with seeking the new. And, regarding the initiatives related to sustainability, Singapore is an example for many cities around the world.
Member of the group of nations known as the Asian Tigers, along with Taiwan, Hong Kong and South Korea, the small insular city-state bases its economy on three pillars – manufacturing, financial services and port activities – which include complementary segments such as shipbuilding, insurance and international legal arbitration, among others. It is no exaggeration to say that Singapore developed itself around the port activity. Even before the Middle Ages, the local port already had an important role in Southeast Asia; the city opened to the West with the arrival of the British East India Company in 1819, a process that was intensified with the construction of the Suez Canal (Egypt) in 1869.
“Because the British steamships of the time had no autonomy to advance to the Far East, Singapore has established itself as a trading post and became a port for maintenance and replenishment of coal (for the ships’ boilers). The shipbuilding industry of the city-state was born at that time”, explains Derek Heng, a professor of Southeast Asian History at Ohio State University, USA, born in Singapore and author of Continuities and Changes: Singapore to the Port-City over 700 years.
Nowadays, the marine industry employs over 170,000 people and contributes with 7% to the local Gross Domestic Product (GDP). The port of Singapore is connected with more than 600 ports in more than 120 countries. Only in 2011, according to the Maritime Authority of Singapore (MDS), the handling of containers at the terminal rose 5.3%, to 29.9 million TEUs (20-foot container), surpassing the 2008 prior record. Sales of bunker (ship fuel) rose 5.6%, to 43.2 million tons.
It’s no wonder that the naval sector is one of the highlights in the city-state economy, along with the oil sector, according to Heng. “Local companies such as Keppel and Sembawang are world leaders in construction of offshore platforms,” he says. “In addition, Singapore has an extensive chain of oil and gas companies, ranging from pipeline manufacturers to petrochemical corporations,” he concludes.
Petrobras has been present in Singapore since 2001, giving local support to the company’s commercial activities in Asia (except for China, which falls under the jurisdiction of the local representative office). From Singapore, Petrobras exports fuel oils in general for Asian companies in the sectors of energy, automotive and mining, among others, besides being the largest supplier of bunker with low sulfur content for ships moving around the Singaporean port.
“Petrobras performs other important operations in Singapore, such as exporting oil to India and selling ethanol to countries such as Indonesia and Malaysia, in addition to buying oil derivatives and bringing them to Brazil”, explains José Brandão Raimundo Pereira, executive manager of Marketing and Sales for Petrobras. “Singapore is a referential market. Petrobras could not be absent from that important commercial and financial trading post. The world’s largest supplying port is located there. In addition, the local shipyards have expertise in converting ship hulls for use in platforms, a service that has already been contracted by Petrobras a few times”, he adds.
A model of sustainable development
Singapore is also recognized for its initiatives in the area of sustainability. The local government plans to invest US$ 1 billion in sustainable development programs in the next five years. The actions range from policies to encourage the construction of green buildings to projects concerning water reuse, waste collection and recycling.
“We are a small city-state with limited power sources. It is imperative to ensure that energy consumption is well managed, to make sure that the new buildings remain sustainable for future generations” says Tan Tian Chong, director of Technology Development of Building and Construction Authority (BCA), the agency that regulates the construction of “green” buildings. Chong’s speech remarks the zeal with which Singapore deals with issues related to sustainability. BCA, for example, released US$ 20 million to encourage adoption of sustainable practices by construction companies between 2006 and 2008. In 2009, a new program was released (this time to adapt old building) with a budget of US$ 100 million.
“We have developed a comprehensive set of actions that necessarily involves the creation of the Green Building Masterplan (guide sustainability standards) and the concession of the BCA Green Mark Award (certificate awarded to approved projects)”, says Chong. According to the executive, the number of “green” buildings in Singapore went from 17 to over 940 since 2005. “This translates into more than 28 million square meters of building area in accordance with standards of energy efficiency, water reuse and environmental protection. The certificate was also required by 140 buildings in China, Malaysia, India and Saudi Arabia, among other countries”, he adds.
There are also major projects in energy efficiency and water treatment. In the first case, the National Environmental Agency (NEA) launched in November 2008 the program Grant for Energy Efficient Technologies (Greet), which aims to encourage local industries to invest in technologies to reduce energy consumption. To convince companies to join the program – mainly at the pharmaceutical, chemical, electronics and shipbuilding sectors – Greet employed the same strategy used by the BCA: easy credit. Today, the initiative will fund up to 50% (limited to US$ 2 million per project) of the compliance costs, including purchase of equipment, qualification of manpower and technical assistance.
Since 2008, more than US$ 10 million in grants have been approved, for 16 companies. According to the NEA, the economy of these corporations in energy costs can reach US$ 350 million by the end of the life cycle of the funded projects. The reduction of carbon emissions would total 1,200 kiloton.
A world-class exemple on 3Rs
The Singapore Packaging Agreement (SPA) is an agreement covering voluntary recycling and reduction of the volume of waste. It is an example for the world largest cities. Based on the concept of 3Rs (reduce, reuse, recycle), the SPA has been signed by 128 companies. According to the National Environment Agency (NEA), a government organization that leads activities related to sustainability (including the SPA), the participants have processed 7.100 tons of industrial waste (data compiled by the end of 2011) since the signing of the agreement in 2007, which represents an estimated saving of US$ 15 million.
In Singapore, the awareness of the importance of treatment and reuse of water is nothing new. George Madhavan, director of the Public Utilities Board (PUB), the national water agency, reports: “Over the past 40 years, through strategic planning and investment in research and technology, PUB has built a solid and diversified water supply model known as the Four National Taps”. The pillars consist of investments in four key areas: water extraction, importing water, purification of reclaimed water (NEWater project), and water desalination. Undeniably sucessful, NEWater envisages the production of ultrapure potable water through purification of treated waters. This modern treatment process uses membranes and ultraviolet disinfection. According to PUB, the four NEWater plants can supply 30% of water demand in Singapore.
Another initiative is based on high technology water desalination. Singapore has one of the largest desalination plants in Asia, capable of producing 30 million liters per day, which represents about 10% of the necessity of the city-state. A second unit, with capacity to produce 70 million liters per day, will be ready in 2013. “Without aquifers (geological formations that store groundwater) or natural abundance of land, Singapore has recognized that having a sustainable water supply was vital since the 1960s,” says George Madhavan, strengthening the avant-garde position that Singapore keeps since then.
With a strong economy, high levels of industrialization and outstanding socioeconomic indicators, Singapore gained worldwide reputation in the early 1980s, when it began to show significant annual growth rates of its Gross Domestic Product (GDP) thanks to a daring plan of social and economic reforms that created jobs and attracted businesses and investments around the world. Since then, the average annual increase of GDP has been 6.32%, according to the International Monetary Fund. The city-state also distinguish itself in attracting foreign direct investment (FDI) by having one of the lowest tax systems in the world. In 2010, Singapore attracted US$ 39 billion in FDI, being one of the 10 countries that received the largest volume of funds that year, according to the United Nations Conference on Trade and Development (UNCTAD), an organ linked to the United Nations (UN).
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By: Vinicius Medeiros
Photos: Thinkstock / Petrobras Image Bank