New approach to deliver help to firms on the way

Trade and Industry Minister Chan Chun Sing speaking at a Singapore Chinese Chamber of Commerce and Industry conference, on Aug 21, 2019.
Trade and Industry Minister Chan Chun Sing speaking at a Singapore Chinese Chamber of Commerce and Industry conference, on Aug 21, 2019.ST PHOTO: KELVIN CHNG

Schemes to be more company-centric as S'pore economy gears up for new challenges

Firms may no longer need to approach government agencies separately for specific grants but instead can deal with a single point of contact for support on business plans, Trade and Industry Minister Chan Chun Sing said yesterday.

"We are going to make our help schemes company-centric, not scheme-centric," Mr Chan said at a Singapore Chinese Chamber of Commerce and Industry (SCCCI) conference.

Rather than telling agencies which schemes they want to adopt, companies could go to them with a business plan instead and leave it to officials to find out what will help the most, he said.

The authorities have been working with the trade associations and chambers to deliver this better.

It is also among the latest commitments made to support businesses ahead of upcoming policy changes and slowing economic growth.

The second-quarter growth came in at just 0.1 per cent from a year ago, fuelling fears of a possible technical recession as global trade tensions squeeze open economies such as Singapore's.

Firms are also gearing up for increasing costs on account of local policy changes, with a rise in retirement and re-employment ages on the horizon, on top of an upcoming hike in older workers' Central Provident Fund contribution rates.

In a Facebook post, Deputy Prime Minister Heng Swee Keat said ministers from the Finance Ministry will continue to "actively engage businesses, unions and other stakeholders", and develop a support package to help companies with the transition.

Yesterday, Mr Chan said the Government is tweaking the way it will support firms, especially small and medium-sized enterprises (SMEs), in the face of short-term challenges and longer-term developments.

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Let us look at the long-term challenges of how we position in the global economy by diversifying our supply chains, by diversifying our markets, so that we can continue to ride through the current volatility. More importantly, to make sure that we position (ourselves) for the next wave of growth.

MR CHAN CHUN SING, Minister for Trade and Industry.

This comes as more businesses are expecting a drop in their revenue and profit margin, amid slowing economic growth and an ongoing trade war. Close to 40 per cent of more than 970 firms polled by the SCCCI expected a fall in revenue, up from around 27 per cent in its annual business survey last year, the group's president Roland Ng said at its annual SME Conference, where Mr Chan spoke. Of those surveyed, 95 per cent were SMEs.

Amid these growing worries, Association of Small and Medium Enterprises president Kurt Wee told The Straits Times that the move to make help schemes more company-centric is a further step after a consolidation of grants since last year to make them less complex for smaller companies. But he added: "The devil will be in the details, and that will involve whether we have experienced officers who understand the schemes across agencies, as well as businesses' needs."

Mr Chan added that firms need to be aware that the trade war is unlikely to be a short-term issue.

The worst-case scenario is a fragmentation of the global trading order, he pointed out.

"How do we prepare ourselves… over and beyond just the US-China trade conflict?" he asked.

He noted the need for companies to continue diversifying their markets and reaping the full benefits of Singapore's free trade agreements. They should also look to growing revenue and going international.

Firms ought to also be ready for the next wave of growth, said Mr Chan. "Let us not just look at short-term challenges," he said. "Let us look at the long-term challenges of how we position in the global economy by diversifying our supply chains, by diversifying our markets, so that we can continue to ride through the current volatility.

"More importantly, to make sure that we position (ourselves) for the next wave of growth."

A version of this article appeared in the print edition of The Straits Times on August 22, 2019, with the headline 'New approach to deliver help to firms on the way'. Print Edition | Subscribe