Singapore will strengthen its status as a global business and technology hub to ensure a sustainable recovery from the Covid-19 crisis, said Minister for Trade and Industry Chan Chun Sing.
Responding to MPs during the debate on his ministry's budget yesterday, Mr Chan said the plan to enhance Singapore's value proposition within the class of the few high-quality, high-trust global business hubs is part of a three-pronged strategy aimed at turning the challenges of the post-pandemic world into opportunities.
The other two strategies involve entrenching Singapore as a critical and hard-to-replace node in global value chains, and building unique capabilities in Singaporean enterprises and workers so they can compete in a more globalised world.
The minister stressed that the world is not returning to the pre-Covid-19 era, which means that even if Singapore's gross domestic product returns to pre-crisis levels quantitatively, it will be a different economy qualitatively.
Mr Liang Eng Hwa (Bukit Panjang) and Mr Desmond Choo (Tampines GRC) had asked how Singapore can stay competitive and relevant amid the disruptions.
In response, Mr Chan said that Singapore will need to create an environment in which it can distinguish itself from others.
It needs to be a safe harbour for capital, talent and ideas, and a connected, trusted and resilient node to serve different markets.
It also needs to embrace new technologies to be a disruptor, and transcend the constraints of its size and geographical location.
To this end, the global hub strategy will need increased emphasis on clear, transparent, consistent and coherent legal and policy frameworks to mobilise capital, aggregate talent and protect intellectual property (IP), Mr Chan said.
Singapore will also need progressive rules to enable new business models to thrive, superior networks that give denser and more secure connections with the world, and a mix of local and global talent to serve global markets, he said.
The country needs to entrench itself in research and development value chains to ensure that businesses include Singapore as part of their global innovation networks, even in times of crisis.
Mr Chan said these are the reasons why the Government is investing heavily in developing local talent and attracting global talent, as well as in digital connectivity, free trade agreements and digital economy networks.
Investments will also be needed in R&D, from basic to translational research for commercialisation, as well as for the IP regime, from assessment to valuation and arbitration.
"We must get all these enablers right to strengthen our position as a global business hub," Mr Chan said.
However, the Government is also aware of the growing competition, he said.
Intellectual capital is fast overtaking physical and financial capital as the defining competitive yardstick. That is why, instead of pursuing only new "sunrise" industries, Singapore also needs to pursue critical capabilities to entrench itself in the global value chains, he said.
Giving the example of the semiconductor industry, he said that instead of worrying about Singapore's global market share, the focus should be on whether the country has access to the IP to produce the chips and build the machines that make those chips.
"Doing what others do at a cheaper price is a 'red ocean strategy'. In other words, these are shark-infested waters - best avoided," he said. "Producing things that others cannot is a 'blue ocean strategy'. Here, opportunities abound. That's where we want to be."
The last strategy involves deepening corporate capabilities and workers' skills.
"Businesses must play their part to develop local talent and grow Singaporeans to take on leadership positions, and Singaporeans must also be prepared to venture overseas to seize new growth opportunities," the minister said.