To ask the Deputy Prime Minister and Minister for Finance (a) has the Government any plan to set up universal processing centers (UPCs), and if so, how does it intend to expedite this set-up; and (b) how can the Singapore UPCs be distinguished from the competition from Australia, China and India.
Singapore has made significant headway in positioning itself as the regional IT and financial hub. Institutional investors and analysts have highly rated our national IT infrastructure, quality of manpower, as well as political and regulatory environment. More companies and financial institutions are outsourcing processing activities, as they seek to save costs and focus on core competencies. The industry has recommended to the ERC setting up Universal Processing Centres (UPCs) in Singapore to leverage our strengths and to support our efforts to develop front, middle and back office activities here.
2 The government supports in principle the set-up of UPCs. The hubbing of higher value-added processing activities in Singapore will create jobs, and generate spin-offs to other economic sectors, such as business advisory, IT and telecommunications. Global corporations and financial institutions are among the early adopters who have consolidated processing along business functions, and also centralised processing either globally or regionally in the American, European or Asian time-zones.
3 Singapore is well-placed to become a key processing hub in Asia. Cost is only one factor. For example, a consultancy study showed that Singapore was a viable location for treasury processing activities despite keen regional competition. Global financial institutions like Citibank and Deutsche Bank already have established processing centres in Singapore serving Asia, and for specific business segments, beyond Asia. We have a critical mass of MNCs and financial institutions here, which is one of our key advantages. The MAS and other agencies are currently in discussion with industry to see how to encourage more UPCs to be set up here.