Parliament: Singapore must continuously enhance its value as connectivity hub to emerge stronger fro
Singapore must press on with efforts to transform the economy for the long haul, amid the twin challenges of supply-chain shifts and technology advancements.PHOTO: ST FILE
ST 3 March 2020
Choo Yun Ting
SINGAPORE - Singapore must continuously enhance its value as a global connectivity hub in order to emerge stronger from challenges, said Trade and Industry Minister Chan Chun Sing on Tuesday (March 3).
Aside from the coronavirus outbreak, which has hurt the tourism and aviation sectors badly, there are also longer-term challenges such as the reordering of global supply chains and technological advancements that Singapore needs to deal with, he told Parliament.
At the same time, Singapore is committed to sharing the benefits of economic growth and ensuring job security for citizens, especially mid-career workers in their 40s and 50s, Mr Chan added.
"Beyond the immediate measures to address the challenges ahead, we must also aspire to emerge stronger, be one of the first to recover and seize the new opportunities." he said during the debate on his ministry's budget.
The Government's immediate priority is to help businesses stay afloat and workers stay employed, he said, highlighting the $4 billion Stabilisation and Support Package introduced at Budget 2020. He noted that the Singapore Tourism Board has formed a Tourism Recovery Action Task Force comprising leaders from both the private and public sectors to support efforts to rejuvenate the tourism industry.
The Government will also commit resources to support the upgrade of hotels and attractions during this lull for the tourism sector, anchor a strong pipeline of leisure and business events in the recovery, and step up marketing efforts to reach new groups of tourists, Mr Chan said.
He added that large-scale tourism projects such as the expansion of the integrated resorts and the rejuvenation of the Mandai precinct are making good progress and will contribute to the growth of the tourism sector in the medium term.
TRANSFORMING THE ECONOMY
Singapore must also press on with efforts to transform the economy for the long haul, amid the twin challenges of supply-chain shifts and technology advancements that could threaten well-established sectors here.
"We need to adapt to changing supply chains by expanding and upgrading our network of FTAs (free trade agreements)," he said.
Mr Chan noted that the Republic's 25 FTAs are with economies that represent more than 85 per cent of global gross domestic product and have provided Singapore's businesses access to billions of consumers abroad by reducing tariffs and lowering non-tariff barriers.
Replying to Workers' Party Non-Constituency MP Leon Perera on the FTA negotiation process, he said that the Government consults and involves trade associations and business chambers, among others, during negotiations and after implementation to enhance the trade agreements.
Trade agreements are also adapted to keep pace with emerging technologies. Mr Chan noted that negotiations with Chile and New Zealand on Digital Economy Agreements have "substantially concluded".
Singapore will help firms take advantage of these trade agreements to go international, he added.
Responding to Nominated MP Douglas Foo, Mr Saktiandi Supaat (Bishan-Toa Payoh GRC) and Mr Teo Ser Luck (Pasir Ris-Punggol GRC), he outlined five ways in which the Government will support businesses in seizing opportunities abroad.
First, the Government will extend the enhanced 70 per cent support under the Market Readiness Assistance scheme for another three years till March 31, 2023. The grant cap will be raised to $100,000 per new market, per company over the enhancement period to better support companies new to internationalisation or are expanding into new markets.
Second, the Double Tax Deduction Scheme for Internationalisation will be extended for another five years till Dec 31, 2025. The enhanced scheme will also now cover certain expenses incurred for third-party consultancy and overseas business missions.
Third, the Grow Digital initiative will be launched to help small and medium-sized enterprises grow their business overseas via digital channels to reach new customers and markets.
Fourth, the Government will work with the Singapore Business Federation to launch GlobalConnect @ SBF, an international advisory centre that provides market access support to companies new to internationalisation, in April.
Fifth, greater support will be given to young Singaporean graduates under the Global Ready Talent programme to take on work opportunities abroad, particularly in South-east Asia, China or India. This will boost the pipeline of local talent to support businesses in expanding overseas.
Singapore also needs to strengthen itself internally through innovation and transformation to complement its international competitiveness, Mr Chan said.
The country's public investment in research innovation, which has grown over the last 25 years, has put it in a good position "to harness the technological revolution and turn old constraints into new opportunities", Mr Chan noted.
The country must do more to translate its research edge into an economic advantage moving forward, he said. It will also strengthen its partnership with trade associations and chambers to drive industry transformation efforts.
Replying to Mr Saktiandi and Mr Desmond Choo (Tampines GRC) on how efforts to grow the economy have translated to benefits for workers, Mr Chan said that more than half of Singapore's local workforce is made up of professionals, managers, executives and technicians (PMETs).
This is one of the highest proportions in the world, and PMET jobs here have risen from about 1.2 million to 2016 to 1.3 million in 2019, he added.
Real median income for Singaporeans also grew at 3.7 per cent per annum from 2016 to 2019, higher than the 3.2 per cent per annum in the preceding three years.
But while economic growth is necessary to create good jobs for Singaporeans, it does not happen naturally, he pointed out.
"The critical link between growth and jobs is skills. Singaporeans must have the right skills to take on the jobs that growth creates," Mr Chan said. "The Government has put in significant investments in our education and training system over many years."
The country has also placed strong emphasis on leadership building within key sectors, he added, noting that the SkillsFuture Leadership Development Initiative has supported more than 1,000 Singaporeans in acquiring corporate leadership competencies and experiences.
But Mr Chan said that Singapore cannot rest on its laurels and must prepare for future jobs to keep pace with the quickening speed of technological change.
"If we do not support our workers in refreshing and advancing their skills, not only will they lose employability over time, businesses will suffer, and our economy will lose its competitiveness," he said.
The Government is aware of the concerns of mid-career workers in their 40s and 50s who have significant financial commitments, Mr Chan noted, adding that many of these workers have not had the opportunity to reskill and upskill after completing formal education decades ago.
He highlighted that those who are employed are worried about their job longevity given the keen job competition, while those who have been retrenched are worried about being able to find a job that matches their skillsets and pay expectations.
Only 58.6 per cent of resident workers aged 40 and above managed to find a job six months after retrenchment in 2018, compared with 70.6 per cent for those in their 30s, Mr Chan said.
Supporting mid-career workers needs to be a tripartite effort, with businesses offering more employment and upgrading opportunities, workers making an effort to reskill, and the Government supporting both stakeholders in their endeavours, he said.
The Government aims to double the annual job placements for locals in their 40s and 50s to 5,500 by 2025 through the SkillsFuture Mid-Career Support Package.
However, Mr Chan urged companies to also play a role by redesigning jobs, creating opportunities for existing and new workers, and reskilling them.
Worker outcomes, such as wage increases and job redesign, will be a mandatory condition for companies that apply for Enterprise Development Grant funding from April 1 this year, Mr Chan added.
The Government will also give a hiring incentive to companies that hire local job seekers aged 40 and above through eligible reskilling programmes.
"The journey ahead is full of both opportunities and challenges. But if we stand together - Government, businesses, workers and citizens - I am certain we can overcome any challenge and chart a better future for all of Singapore," Mr Chan said.