SINGAPORE - Singapore is building a network of digital economy agreements to help professional services firms access overseas markets through the digital realm.
This is one of the key initiatives in strengthening the sector’s competitive edge in the face of greater economic uncertainty, said Minister for Trade and Industry Chan Chun Sing said on Thursday morning (Oct 1).
He said the Government will establish the right macro-conditions for the professional services sector to thrive.
This includes working on free trade agreements to allow firms here to access markets beyond Singapore, as well as strengthening efforts to build a new network of digital economy agreements.
“We want to be seen as a hub where people can... exchange, analyse and process the data in a safe and secure environment,” said Mr Chan at a briefing during a visit to PwC’s office in Marina One.
Pointing out that the professional services sector underpins Singapore’s status as a business hub, he said that how well it does “will determine and shape the future trajectory of Singapore’s growth”. The sector contributed 5.1 per cent to Singapore’s nominal gross domestic product in 2019.
“Professional services does not just create jobs for Singaporeans in Singapore, it also creates very high value-added and challenging jobs for Singaporeans beyond Singapore, and that is how we are able to grow our external wing as well,” Mr Chan said.
He noted that competition in this sector is no longer in a single domain. Citing PwC as an example, Mr Chan said that if the company “was just an accounting firm, then it would have been displaced long ago by a super Excel spreadsheet”.
Instead, like many professional services companies, PwC provides a range of services, including risk management, traditional bookkeeping and business consultancy.
“This can play to Singapore’s advantage, because whoever can train their workers in the suite of adjacent competencies will be better able to protect their competitive position,” he added.
There is also an opportunity for Singapore with many companies looking for trusted partners as they accelerate plans to transform business models to survive and thrive in the Covid-19 pandemic, as well as firms finding a location to operate across different markets in a fragmenting world, said Mr Chan.
On the legal side, Singapore has also created a whole network of legal conventions “to establish ourselves as a choice location for legal and financial services”, which he said will help strengthen Singapore’s position as the region’s financial hub.
Singapore must continue to leverage its brand of trust too.
“It’s about whether clients can trust us with their information and data, whether they can trust the quality of our work,” he said.
Mr Chan stressed that Singapore must continuously look at how it strengthens its ability to grow and attract talent to serve a global market.
“If we continue to do this well, then we have every opportunity to continue to excel as a global business hub with a very strong, vibrant professional services sector,” he said.
Also speaking at the briefing, Ms Indranee Rajah, Minister in the Prime Minister’s Office and Second Minister for Finance and National Development, noted that although professional services sector was affected by global lockdowns and Singapore’s circuit breaker period, “some of the work is starting to come back but some part of this will also be dependent on global travel”.
“In the medium and longer term, professional services is a major growth area. We do have the talent and ability here to anchor (the sector),” she said.
While 70 per cent of law firms reported a decrease in work due to the recession, areas such as insolvency, litigation and dispute resolution services are picking up, Ms Indranee pointed out.
Corporate and transaction work has taken more of a hit during the recession, she noted.
“But there’s potential for mergers and acquisitions as investors start looking to see, from companies that are under some pressure, which are the ones they can pick up and invest in.”
What is crucial is helping law firms position themselves for future growth when the economy picks up, as legal services demand will also recover, she said.
Technology adoption and digitalisation has come to the fore, Ms Indranee noted, citing the extension of the Tech-celerate for Law programme to January next year to support law firms in their digital transformation.
The grant support for the programme covering the first-year cost of adopting baseline and advanced technology solutions has been increased to 80 per cent, up from 70 per cent.
In addition, Ms Indranee said a programme called the Technology and Innovation Roadmap will be launched on Friday at the TechLaw.Fest 2020.
“This would outline plans to promote innovation and tech adoption and developments in Singapore’s legal industry in the next decade, and includes an overview of upcoming initiatives such as a legal industry digital plan that provides law firms with practical assistance to assess their digital readiness and identify digital solutions to adopt at each stage of their growth,” she said.
The ability to anticipate problems will be crucial for the sector, Ms Indranee added.
“That’s what clients pay for in professional services. They are trying to understand what is going to happen in the future... because all bets are off... That ability to help clients navigate an uncertain future is very important,” she said.