SINGAPORE - With the threat of global protectionism and the rise of the digital economy posing formidable challenges to Singapore's economy, the country must make use of its domestic and regional advantages to find opportunities for growth, Minister for Trade and Industry Chan Chun Sing said on Thursday (Oct 25).
This means leveraging on Singapore's traits: Its connectivity with a fast growing Asia and Asean economy, its rule of law, its predictable pro-business environment, its push for technological adoption and its prospects as a regional hub.
Mr Chan was speaking to academics, business professionals and economists at the annual Singapore Economic Policy Forum at Mandarin Orchard hotel. His 47-minute speech delved into the challenges Singapore face today, such as the United States-China trade conflict.
Mr Chan shared several key strategies Singapore needs to ensure its future success.
Singapore should build on its connectivity to other players in Asia and Asean, improving its capability as a data, talent, finance and trade node, he said.
He gave the example of British home appliances manufacturer Dyson, which announced on Tuesday that it would build a new electric car plant in Singapore by 2020.
"Why did Dyson choose Singapore? It is because of our connectivity, because Dyson requires a global supply chain. Our land and labour cost may not be the cheapest, but our superior connectivity will allow them the opportunities to create a new industry for Singapore," said Mr Chan.
Singapore is also playing a leading role as a member of the World Trade Organisation (WTO), working with like-minded countries to update international trade rules to new ways of doing business.
This is because WTO's current rules are based on an outmoded context and do not consider how data and finance flows in the new economy.
Said Mr Chan: "We will be the first to admit that the WTO system is not perfect, but that does not mean we should throw the baby out with the bathwater."
He revealed that his ministry is working with the Ministry of Foreign Affairs and the Ministry of Finance to develop new "pathfinder standards", which aim to inspire confidence in business innovation.
On the domestic end, Singapore must also adopt technological solutions to transform current business processes and models, adding on to his speech on Monday that the Government will adopt industry-specific measures to complement broad-based policies.
One new measure is to connect large enterprises, trade associations and chambers (TACs) and government agencies to form "sectoral research and development plans".
Mr Chan challenged the Government's research arm, Agency for Science, Technology and Research (A*Star), to find 10 progressive TACs, 10 large firms and 10 agencies to form such plans.
"This is something that we need to do much better, for research and development to translate into commercial products cannot be left to chance. It is a concerted effort to have regular dialogues within the commercial arm of the economy with the research arm," he said.
He emphasised the important role TACs play and called for them to step up their efforts in bringing the sector together in implementing their respective industrial transformation road maps, reiterating a call he made on Monday.
From a governance perspective, Mr Chan said Singapore strives to have "agility in regulations" in order to allow the creation and piloting of new business models and technologies, even though some may call regulatory agility an oxymoron.
Fintech (financial technology), for example, is a field that would benefit from such flexibility, he said.
"Should it be regulated by the Monetary Authority of Singapore, because of the 'fin' in fintech? Or the Ministry of Communications and Information, because of 'tech'? It does not matter, it is regulated by the Singapore system," said Mr Chan.
Besides local regulations, the Government also needs to help companies navigate the laws in other countries too to help them penetrate into those markets.
On talent growth, Mr Chan highlighted existing moves by the Singapore Economic Development Board and Enterprise Singapore to create a global innovation alliance of Singaporean students, entrepreneurs and businesses, as well as a network of Singaporean families, plus friends and fans of the country.
These alliances and networks would allow Singapore to benefit from global talent and connections, even if they choose not to work here.
Beyond schools, talent development and learning should also occur in workplaces, which represent the latest in innovation and knowledge.
"In tomorrow's economy, it depends less on how much we know when we graduate from the schools; it depends much more on how fast our people are able to learn, unlearn and relearn," said Mr Chan.