After a year of deliberations, the Committee on the Future Economy released their recommendations in February 2017. The seven strategies, said Finance Minister Heng Swee Keat, form the blueprint that will guide Singapore companies and workers to create an economy that is primed for the future. We break down the 109 page report into bite-sized information.
Singapore has to stay open and connected to the wider global markets and maintain links with countries which are also looking to keep borders open to trade and investments.
But more than just staying open, Singapore residents and companies should use these relationships to expand their own presence overseas. Singaporeans should explore working overseas while companies should push ahead at growing their external arms. Institutes of Higher Learning should also link up with institutions in countries such as China, Europe and the US to form a Global Innovation Alliance.
The Bottom Line: Stay open, make new friends and make use of our relationships overseas. Because we have no natural resources, this is the way Singapore has, and will continue to make it work.
Disruptive technologies such as 3D printing and artificial intelligence have redefined jobs in almost every industry. Some jobs will be lost, but new jobs are also emerging in fast-growing sectors which did not exist a decade ago, such as data analytics and robotics. It is becoming increasingly difficult to predict what skills will be needed in the economy of the future.
To ensure Singaporeans continue to have good jobs and incomes, the labour market needs to place stronger emphasis on skills. Those who have been laid-off also need to be able to quickly acquire skills for new jobs in emerging sectors.
The Bottom Line: Jobs and workplaces are changing at breakneck pace. To stay relevant, workers have to keep learning and companies must make training a priority.
Singapore must become a choice location for innovative companies developing products and solutions for the global market. Our companies have traditionally played a “middleman” role in the world economy, but this strategy is no longer sustainable. To survive in an increasingly competitive world, companies have to come up with never-before- seen products and solutions.
Singapore must, therefore, nurture innovative young companies and be open to entrepreneurial talent. These companies should receive help at all stages of their life cycle – from the early stages of seeding an idea to scaling up and spreading their wings overseas.
The Bottom Line: Take advantage of our strong research base and fast-growing start-up scene to build world-beating companies.
The digital economy is opening up brand new industries and transforming existing sectors like manufacturing, healthcare and financial services. It presents vast opportunities for a small country like Singapore, which already has a highly connected, tech-proficient population. These technologies can help SMEs transcend Singapore's small market to go overseas, for instance, through e-commerce.
Data is also becoming an increasingly valuable asset, especially to companies looking for insights into their customers, and consumer behaviour. Singapore can position itself as a hub for data analytics and cybersecurity expertise in the region, in line with its push to become a Smart Nation.
The Bottom Line: The economy of the future will be digital. Companies need to get comfortable with technology and Singaporeans need niche skills in emerging sectors.
As a gateway to Asia, Singapore needs strong links to the rest of the region. This means investing in infrastructure like Changi Airport’s Terminal 5, the new port in Tuas and the Kuala Lumpur-Singapore High Speed Rail.
At home, Singapore should come up with innovative, more flexible ways to use its limited land area – for instance, by developing special zones conducive to innovation and emerging industries.
The Bottom Line: As our economy evolves, so must our approach to land use planning. Singapore has to remain an exciting and liveable city. We do this by improving our international connections, creating new spaces and refreshing existing infrastructure.
There is no one-size- fits-all approach to transforming companies or improving productivity. There are different challenges and opportunities in every sector and the Industry Transformation Maps (ITMs) are introduced to offer targeted, industry-specific help for firms to invest in skills, boost innovation and promote internationalisation.
The ITMs, which cover 23 industries that span 80 per cent of the economy, were unveiled under a $4.5 billion programme announced in Budget 2016. Six have been rolled out so far – for the retail, food services, hotel, precision engineering, logistics and food manufacturing industries.
In sectors with strong growth prospects, the ITMs will map out opportunities and help companies invest in new capabilities. In sectors facing challenges or struggling to restructure, the ITMs will focus on helping firms transform and redesign jobs.
The Bottom Line: Different folks, different strokes – 23 sectors will each receive tailored help to innovate, grow and expand abroad.
Deeper collaboration among all stakeholders in the economy – companies, workers and Government – is essential for Singapore to move into its next phase of growth. Trade associations and chambers, for instance, can play a vital role in industry transformation by taking the lead in their respective sectors to help companies re-tool and scale up. Policymakers can support businesses by crafting laws that support innovation and risk-taking, as well as by issuing Government tenders with a view to support the development of innovative products and services.
Singapore’s tax system also needs to be refined to prepare for rising expenditures as the population ages and infrastructure needs grow.
The Bottom Line: Work together. The whole is bigger than the sum of our parts.
The CFE recommendations were aimed at providing a vision and a guide to transform Singapore, its people and companies for the new economy. The message is a simple one: Singapore must stay relevant to the world and we can do this by continuing to play on our strengths even as we stretch our capabilities to meet the changing needs of the economy.