Pearl Forss, Channel NewsAsia 27 May 09;
SINGAPORE: The government will set up an Economic Strategies Committee to study the long-term economic transformation of Singapore. It will be headed by Finance Minister Tharman Shanmugaratnam.
Singapore has taken decisive measures to tackle the economic crisis, said Prime Minister Lee Hsien Loong. But even as Singapore's approach to economic development remains valid, Mr Lee said there is a need to review specific strategies to develop different sectors.
He said: "We have to let the resources shift from the businesses which are shrinking to the businesses which are growing, and gear up for the changed new world, rather than wait in vain for old business to come back."
So the prime minister has tasked the Economic Strategies Committee, which includes members from the public and private sector, to look into growth opportunities abroad.
These include developing new markets in emerging economies such as the Gulf; seeking out niche opportunities - such as manufacturing aerospace components - in developed countries; and exporting Singapore's unique expertise - like its urban planning capabilities - to other Asian cities.
With regard to strengthening local corporate capabilities, Mr Lee said the country can work to attract the next tier of global companies that are smaller than the Fortune 500 multinationals but still large by Singapore standards.
Examples include the Mittelstand sector from Germany, and Berg Propulsion, a leading Swedish manufacturer of marine propellers and thrusters, which is already located here.
He said the Republic can also be the base for Asian MNCs to internationalise because the country is familiar with these Asian companies and at the same time operates by Western business norms.
For example Focus Media, China's leading providing of advertising platforms, has chosen to locate here.
More will also be done to grow local companies. Mr Lee added: "We are trying many ways to do this and we are willing to do more.
"There is no simple answer to this question and I do not believe this can be done by the government simply pouring money in, or one of the favourite quick proposals, setting up 'Temasek II'. The critical factor is not availability of money or capital.
"The critical thing is that you need to build up the entire enterprise ecosystem - the whole environment where you can attract talent, develop entrepreneurship, which means people with bright ideas, the passion, the drive, and the organisational ability to take a spark to a brainwave, to a start up, to a company, to an IPO, and then we hope, a Fortune, and a roaring success.
"They need professional management, they need to invest in technology, they need to develop distinctive brands. It's not an easy thing to do, but it's something which we will work at."
Other priorities attracting top talent from the world are studying resource efficiency and gearing up for climate change. So for example, the government will study the use of underground space to overcome land limitations.
It will also encourage energy conservation, so Singapore can grow more sustainably and be less affected by high prices.
The committee will develop the main recommendations in time for next year's Budget, which usually takes place in February.
According to the Finance Ministry, the list of Economic Strategies Committee members and further details will be released in two weeks. - CNA/vm
Full transcript of the Prime Minister's speech.
5 economic strategies
Straits Times 28 May 09;
PRIME Minister Lee Hsien Loong outlined five strategies in his speech yesterday to give an idea of the issues that an Economic Strategies Committee will study.
1 SEIZING GROWTH OPPORTUNITIES
Singapore could make its mark by pursuing more niche business opportunities, such as making aerospace components, in developed nations,
'It's very high technology, precision, needs absolute reliability, quality assurance and cost is less of a consideration,' said Mr Lee, adding that aerospace companies would find Singapore a good place to establish themselves in Asia.
The emerging economies, which are still expanding, are another bright spot in the global crisis. Singapore has a number of projects in the Gulf, which is still investing in infrastructure. Given its growing track record, it can aim for more. It could also exploit its strengths in urban planning and development, which are in demand in fast-growing Asian cities. He cited two latest projects in China: the Singapore-Nanjing Eco High-Tech Island and the Suzhou-Nantong High Tech Park.
Closer to home, it could maximise 'win-win cooperation' with its neighbours. The Iskandar Malaysia economic corridor project in Johor is an example.
2 STRENGTHENING CORPORATE CAPABILITIES
Having wooed top global firms such as Shell and Motorola here, Singapore is eyeing the next tier - those 'after the Fortune 500' companies.
They may be smaller than the international corporate giants, but are large by Singapore standards. These companies want to expand in Asia, but are unfamiliar with the region.
Mr Lee said Singapore has been courting Germany's small and medium-sized enterprises sector for many years, with some success. Also here are European firms like Berg Propulsion, a Swedish manufacturer of marine propellers and thrusters. Asian multinational companies are another target, he said, citing Focus Media, China's leading provider of advertising platforms, whose global headquarters is based here.
The Government will also study how to help Singapore firms go global, a concern raised by many MPs. But Mr Lee said there is no simple answer.
'I don't believe this can be done simply by the Government pouring money in, or, one of the favourite quick proposals, setting up Temasek II,' he said, referring to calls for a set-up like Singapore investment company Temasek Holdings. The critical factor is not the availability of money, but an entire 'enterprise ecosystem' that can attract talent and develop entrepreneurship.
3 GROWING HUMAN AND KNOWLEDGE CAPITAL
Singapore must develop the capabilities of its people, said Mr Lee. 'Our future lies in being a leading global city for talent and our own talent as well as top talent from around the world.' But Singapore has to be a first-class location for talent to want to come and take root here. It means encouraging Singaporeans to welcome and help them integrate into society.
'We have to say, ?Foreigners, come'. Singaporeans first, but we are going to make this place prosper with all the help we can get, and then we will have a bright future,' Mr Lee explained.
Also on the cards: a review of the five-year-old billion-dollar research and development programme, which is making progress and yielding results.
4 CREATING HIGH-VALUE JOBS FOR SINGAPOREANS
Growth must translate to good jobs and higher wages for Singaporeans across the board, he said.
The strategy is to attract industries that will need skilled workers and pay them well. Companies must also upgrade workers, and Singaporeans must acquire skills that are in demand through education and by upgrading.
A fourth university by 2011 and the proposed Singapore Institute of Applied Technology will give this step a boost.
5 MAXIMISING RESOURCES
Singapore's land constraints call for creative solutions: Going underground is expensive 'but some of it can make economic sense', he said. Another way is to build upwards. Height limits for buildings due to air traffic could be eased with better air navigation and air traffic control.
Singapore has to find ways to reduce dependence on its one million foreign workers and grow its economy without indefinitely increasing their numbers.
A third limit is energy, which will become more expensive. Singapore must study how it can encourage energy conservation,
diversify energy sources and reduce dependency on piped natural gas from nearby sources.
It must be prepared to play its part too in any global deal on climate change.
GOH CHIN LIAN
