SMALL and medium-sized firms (SMEs) are urged to increase their export competency and pursue new markets aggressively during the difficult economic climate.

Minister of State for Trade and Industry and Manpower Lee Yi Shyan on Thursday said SMES have to build 'competencies' so they will be ready to capture new opportunities during the upturn.

'Our exporters need to be well-prepared to weather this downturn by remaining competitive and relevant,' he said at the IE Singapore's annual exporter seminar on Thursday. Mr Lee also launched a new scheme that aims to give businesses knowledge about entering new markets and how to go about conceptualising their export strategy.

Called the Exporter Development Programme, this new initiative by IE Singapore will not only take companies on overseas market visits, but also provide them with a 'systematic approach' to develop their export strategy through workshops and training courses. IE will support roughly 70 per cent of the costs, with the participating firm coughing up the rest.

The programme has an initial funding of $6 million and aims to benefit over 1,000 SME exporters in the next three years, via partnership with trade associations and chambers.

IE's latest scheme is targeted at companies without much exporting experience. In a way, its focus differs from the agency's broader 'internationalisation' schemes that gives firms the leg up in setting up shop abroad.

IE also has an existing export coverage scheme, but this scheme is less about developing a firm's 'capabilities' and more of a trade credit insurance that protects exporters against non-payments from overseas buyers.

'Exporting will continue to be one of the first steps for Singapore companies to internationalise. We're fortunate to be right in the middle of the growing Asian market,' said IE Singapore's chief executive, Mr Chong Lit Cheong on Thursday.

Separately, Mr Lee said there is currently no 'significant impact' when asked about Singapore's export environment in light of the heightening tensions in the Korean Peninsula. North Korea on Wednesday threatened to attack South Korea's warships and also declared that the truce that ended the Korean War in 1953 was no longer valid.

'So far I don't think there's a great impact but of course the stability in North Asia is important to us as a whole,' he said.