Singapore’s Economic Development Board (EDB) sees OEMs increasingly broadening their supply chains to Southeast Asia, in an an effort to be closer to what will amount to the world's fourth largest economy.
The national development agency also feels that given the massive order backlogs for commercial aircraft in the region, Airbus, Boeing and other top tier companies are looking at how to gain greater proximity to customers.
“ASEAN tends to be overshadowed by some of the bigger neighbours within the region,” says Tan Kong Hwee, director of transport engineering at the EDB. “ASEAN has a population of about 600 million, and our forecast suggests it will be fourth largest economy in the world by 2050. In the next five to ten years, you'll see an average of 5% annual growth within ASEAN. This means the middle class will be spending a lot more on air travel.”
Tan made the remarks at a press conference preceding the opening of the show on Tuesday 16 February.
The Association of Southeast Asian Nations comprises Singapore, Indonesia, Brunei, Malaysia, Thailand, Myanmar, Cambodia, Laos, Vietnam, and the Philippines.
“From our conversations with OEMs, they are thinking about how to diversify their supply chain, and whether there is a need to shift this much closer to customers,” he adds. “Singapore has great strengths in MRO, but we can do much more, and will move to other aftermarket services.”
He notes that Singapore has greatly benefitted from this trend, with international aerospace firms attracted by the country’s ease of doing business, investment friendly climate, well-educated population, and commitment to intellectual property rights.
In the past three years, he notes that major firms such as Pratt & Whitney, Rolls-Royce, and UTC Aerospace have made key investments in the country over the last three years. The country is also the home of two of the world’s top five MRO firms: ST Aerospace and SIA Engineering Company. Overall, the sector employs 20,000 people in Singapore.
Source: Cirium Dashboard
