Teh Shi Ning, Business Times 5 Feb 10;
MANY elements of Singapore's new economic blueprint are not new, but the policies with which to turn the Economic Strategies Committee's vision into reality will need to be, says Senior Minister Goh Chok Tong.
Singapore stands at a 'turning point', hence the need for a re-evaluation of growth strategy. But 'ideas cannot change very much, we cannot have a sudden new direction', Mr Goh told local media at the close of his six-day visit to the Middle East yesterday.
Responding to a query on whether the ESC's blueprint goes far enough, Mr Goh says he would not be sceptical at all. Making innovation and R&D a priority, for instance, needs to go beyond pumping investments into research, to commercialise outcomes. Aspirations for Singapore to be a leading global city are not new either - it is the means to those ends which are, Mr Goh says.
The financial services sector must remain an emphasis; manufacturing must still be diversified and higher value-added. 'So all these on paper are not new,' Mr Goh said. 'What is new is how you do it.'
The ESC's wide-ranging recommendations target an overall doubling of annual productivity gains to 2-3 per cent over 10 years. 'Whilst the diagnosis of the problem is easy and the remedy is easy on paper, it is not easy in practice,' Mr Goh said.
He thinks that there will need to be continued investment in human capital, as well as a mindset change. Singaporeans need to accept a more modest pace of 3 to 5 per cent GDP growth as the economy evolves, Mr Goh says.
Another hint of difficulty has been in the wariness of some businesses, of the idea of using the foreign worker levy to manage Singapore's dependence on imported labour.
Pointing out that this is not the first time Singapore is using prices to raise productivity, Mr Goh says that the government's experience with raising wages back in 1978 to jolt companies into boosting productivity will help. 'We have the advantage ... of knowing how far and how fast you can go,' he said, adding that he believes the finance ministry will announce incentives to spur companies to raise their productivity and training too.
Foreign labour issues were in fact among the topics Mr Goh discussed with the Bahraini leaders he met over the past two days. Bahrain's economic competitiveness is highly dependent on foreign workers, which make up 50 per cent of its population, compared to 30 per cent of Singapore's. Mr Goh says that Singapore can learn from Bahrain in terms of how to manage and treat foreign workers well, without creating social pressure on domestic society.
Reflecting on his visits to Bahrain and Oman, Mr Goh says that both have made tremendous progress, as evidenced in the transformation of their cities' physical infrastructure since his previous visits. 'Both are emerging economies, vibrant, thriving, and like Singapore, looking for new ways to grow.'
Mr Goh thinks that there is potential for Singapore companies to go beyond providing services in large-scale projects, such as MTQ and Sembcorp's engineering and water and power projects in the Middle East, to make investments in the region, such as in real estate.
'As the economy matures, we have to look to the external wing to grow our gross national product,' Mr Goh said. It is his aim to open doors in non-traditional markets with such bilateral visits.
Even for the individual Singaporean, Mr Goh said, 'there is still a big world outside, you can still earn big money but you have to be entrepreneurial, innovative and take risks'.
