Asia industry banks on process

While some sectors of the Asian economy are slowing down, Asia's process industries remain in relatively fine shape—overtaking one country's electronics sector as the highest contributor to manufacturing output. The first ever ProcessCEM Asia conference and exhibition, which took place in Singapore, October 22-24, 2008, attracted more than 100 exhibitors from 14 countries and resulted in...

01/01/2009


While some sectors of the Asian economy are slowing down, Asia's process industries remain in relatively fine shape—overtaking one country's electronics sector as the highest contributor to manufacturing output.

The first ever ProcessCEM Asia conference and exhibition, which took place in Singapore, October 22-24, 2008, attracted more than 100 exhibitors from 14 countries and resulted in more than S$15 million of sales and orders, according to the event's organizer, ASPRI (Association of Process Industry).

ASPRI was established in 1997 as an initiative to promote the interests and needs of service providers to Singapore's process industry. ProcessCEM Asia was launched to provide a platform for industry players in process plant construction, engineering, and maintenance to showcase their capabilities.

At the event's official opening, Tharman Shanmugaratnam, Singapore's Finance Minister, revealed that the country's chemicals industry (defined as petroleum, petrochemicals, and specialty chemicals) has overtaken Singapore's famed electronics sector to become the largest contributor (S$82 billion) to manufacturing output. He also highlighted recently negotiated major projects, including two mega crackers from Shell and Exxon Mobil, a butyl rubber facility by Lanxess, and Nestle Oil's S$1.2 billion biodiesel plant.

Chairman of Shell Singapore, Lee Tzu Yang, emphasizes the importance of workplace safety in his keynote address at the ProcessCEM opening ceremony.

Chairman of Shell Singapore, Lee Tzu Yang, emphasizes the importance of workplace safety in his keynote address at the ProcessCEM opening ceremony.

Chairman of Shell Singapore, Lee Tzu Yang, emphasizes the importance of workplace safety in his keynote address at the ProcessCEM opening ceremony.

Industry prognosis

Conversations with some of the major process automation vendors in Singapore (many of which have their Asia-Pacific headquarters located here), indicates that while order books are certainly currently healthy, the global financial crisis is starting to make an impact.

“In the wake of the current crisis, project funding is a major challenge. Projects which are approved will proceed, but capital expenditures not approved will most likely be delayed,” Au Yeong Pak Kuan, Southeast Asia head of Honeywell Process Solutions, told Control Engineering Asia . “Companies are focused on maximizing throughput and efficient production, rather than spending on new capital projects.”

Kwek Keng Huat, Singapore country manager, Emerson Process Management, expresses a similar view: “Currently, project activities in Singapore remain busy, however, project financing will certainly impact new investment, with some cancelled and others delayed a few months for observation.”

Meanwhile, Huat's Emerson India counterpart, Sunil Khanna, says: “So far, we've seen no significant slowdown in the project and infrastructure business. However, some private companies have indicated that they will renegotiate recently awarded contracts and may even slow down or defer implementation. Once project financing picks up again, we are quite optimistic about the long term growth horizon.”

The global financial turmoil will, to a certain extent, impact Asia Pacific, Invensys Process Systems (IPS), tells Control Engineering Asia . “But the market is still looking strong despite some delays in key infrastructure projects. There is still a growing market demand in the Asia Pacific region, which represents 30% of global process automation spend.”

IPS also sees another, more positive, impact from current project financing constraints. “More operators will be challenged to find funding for large scale replacement or purchase of new systems and technology. Hence, we see increasing interest in solutions related to asset management, extension of plant asset life, performance and production optimization, soft migration and digital upgrade solutions.”

While adverse effects from the global financial tsunami may have been expected, a more surprising finding is the extent to which the availability of skilled workers is impacting process industry projects in Asia.

“Skill shortages continue to plague the oil and gas industries, as huge demand from the Middle East continues to attract labor from Southeast Asia,” says Honeywell's Au Yeong. “And we see an increasing demand for training simulation solutions as a result of aging workforces and attritions.”

Even populous India is experiencing skilled labor issues. “More than 450,000 engineers graduate annually from India's technical institutions, but the high growth in IT has virtually 'sucked' the best of these resources elsewhere,” laments Emerson's Khanna.

However, Khanna sees the pronounced slowdown in the financial sector providing at least some respite. “More skilled manpower is now expected to choose the core engineering streams instead of pursuing careers in finance and investment banking.”

For its part, ASPRI points out that, “With the influx of investment to Singapore, most of our members are facing great difficulties in recruiting local manpower with the required skills to carry out their jobs.”

To ease the problem, ASPRI has been participating in several job fairs and career talks to increase the profile of the process industry. In 2007, it signed a landmark private-public sector memorandum of understanding (MOU) with several key Singapore government agencies to help enhance the capabilities of the local engineering service providers “to better support the process plant owners and to help prepare them to venture overseas”

As a result, ASPRI is currently running a number of government-approved training programs, including, signalman course, rigger course, metal scaffolding erection, oil/petrochemical safety orientation course, and confined space safety assessor course.

Also emphasizing human resources was Shell Singapore chief Lee Tzu Yang, during his keynote address on the topic of workplace safety at the ProcessCEM opening ceremony. Noting that 28 out of the 30 fatalities in Shell plants worldwide in 2007 were contractors, Lee stressed the need for companies to engage contractors as well as staff into plant safety initiatives.

He also made the point that 4% of global GDP is lost annually because of safety incidents, and that paying proper attention to process plant safety has a positive impact on business growth.


Author Information

Bob Gill is group editor of Control Engineering Asia, an English-language publication serving control, automation and instrumentation system engineers in Southeast Asia. Contact him at bob.gill@rbi-asia.com .




No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2015 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
2015 Top Plant: Phoenix Contact, Middletown, Pa.; 2015 Best Practices: Automation, Electrical Safety, Electrical Systems, Pneumatics, Material Handling, Mechanical Systems
A cool solution: Collaboration, chemistry leads to foundry coat product development; See the 2015 Product of the Year Finalists
Raising the standard: What's new with NFPA 70E; A global view of manufacturing; Maintenance data; Fit bearings properly
Special report: U.S. natural gas; LNG transport technologies evolve to meet market demand; Understanding new methane regulations; Predictive maintenance for gas pipeline compressors
Cyber security cost-efficient for industrial control systems; Extracting full value from operational data; Managing cyber security risks
Drilling for Big Data: Managing the flow of information; Big data drilldown series: Challenge and opportunity; OT to IT: Creating a circle of improvement; Industry loses best workers, again
Migrating industrial networks; Tracking HMI advances; Making the right automation changes
Understanding transfer switch operation; Coordinating protective devices; Analyzing NEC 2014 changes; Cooling data centers
Upgrading secondary control systems; Keeping enclosures conditioned; Diagnostics increase equipment uptime; Mechatronics simplifies machine design

Annual Salary Survey

After almost a decade of uncertainty, the confidence of plant floor managers is soaring. Even with a number of challenges and while implementing new technologies, there is a renewed sense of optimism among plant managers about their business and their future.

The respondents to the 2014 Plant Engineering Salary Survey come from throughout the U.S. and serve a variety of industries, but they are uniform in their optimism about manufacturing. This year’s survey found 79% consider manufacturing a secure career. That’s up from 75% in 2013 and significantly higher than the 63% figure when Plant Engineering first started asking that question a decade ago.

Read more: 2014 Salary Survey: Confidence rises amid the challenges

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
This article collection contains several articles on the vital role that compressed air plays in manufacturing plants.