Singapore will have to create clusters of globally competitive companies if it is to stay relevant in an era when growth is centred on innovation and technology, the Singapore Business Federation (SBF) said yesterday.
These innovative companies can be an important "third growth engine" for the country alongside its traditional reliance on multinational corporations and government-linked companies, according to a new report from the business chamber's committee on small and medium-sized enterprises (SMEs).
The report makes 21 recommendations to the Government ahead of next month's Budget.
The committee suggested that the Government could make Singapore a more conducive place to nurture globally competitive companies by setting up a private bourse to make it easier for innovative players to raise capital.
This would be akin to China's New Third Board, an over-the-counter market for investors who can take on riskier investments, said committee chairman Lawrence Leow.
More talent can be attracted if the Government refines its work pass criteria for foreigners to allow entrepreneurs with disruptive technologies to be granted an EntrePass, on condition that they enter into a joint venture with a local company.
Meanwhile, the cost of doing business remains a top concern among SME bosses. A recent SBF survey showed that many companies feel challenged by compliance and regulatory expenses, more so than manpower costs, a traditional bugbear for SMEs.
The SME committee has urged the Government to streamline compliance and regulatory-related costs with the focus falling initially on the advanced manufacturing and food services sectors.
It asked the Government to hold back any planned hikes in foreign worker levies across all sectors for 36 months.
It repeated its call for government landlords to take the lead in adopting a fair tenancy framework to give renters some relief, among other things.
Senior Minister of State for Trade and Industry Sim Ann, who is an adviser to the SME committee, called the report a "strong effort" during a press conference at the SBF office yesterday.
She added that quite a number of the suggestions built on existing government schemes.
"I take that as an affirmation that the existing suite of schemes are in the right direction and that our companies, especially the SMEs, have benefited from them," she said.
"Certainly, the Government will study very carefully the SME committee's suggestions for refinement and enhancement."
The SBF's Budget recommendations come ahead of the release of an economic transformation plan from the Government's Committee on the Future Economy (CFE) later this month.
Asked if the CFE recommendations address any of the concerns voiced by the SME committee, Ms Susan Chong, chief executive of Greenpac and a member of the CFE, said: "The CFE has a bigger picture. Of course, it will not be something that's so easy for the local businesses to accept overnight.
"But what the CFE hopes to achieve is to not only announce a plan, but also to guide them through the transformation."