Committee on the Future Economy report: Build partnerships for growth and innovation

Committee on the Future Economy co-chairman Heng Swee Keat speaks during the report launch.
Committee on the Future Economy co-chairman Heng Swee Keat speaks during the report launch.ST PHOTO: KEVIN LIM

SINGAPORE - Everyone, from workers and companies to the Government, must strengthen their bonds to keep powering growth and innovation in the Singapore economy in the years ahead, the Committee on the Future Economy (CFE) said.

In its report released on Thursday (Feb 9), the committee made five recommendations that it believes would encourage such partnerships to flourish.

First, trade associations and chambers (TACs) and unions should take on a greater role in leading initiatives to lift their industries and support their member companies to scale up and venture abroad.

One good example is how the Singapore Manufacturing Federation (SMF) collaborated with the Enterprise Europe Network (EEN), IE Singapore and Intellectual Property Intermediary to form an EEN Singapore Centre.

Launched in April last year, the Centre facilitates Singapore companies' access to technological know-how, intellectual property and partnership opportunities within Europe.

Unions should also continue to nurture a sense of co-ownership among workers and help them prepare for the jobs of the future, the committee said.

Second, the Government should create a regulatory environment that supports innovation and risk-taking.

 

"The Government will need to be nimbler given the rapid pace of innovation and increasing global competition. We must take risks and be willing to make fundamental changes to support the emergence of potentially-disruptive business activities," the committee said.

This means, for example, that the Government should identify and focus on areas with high potential for technological and industry innovation, and where regulation needs to keep pace.

It should also develop a greater capacity in the public service to encourage innovations. The Government and industry should work together to proactively identify other areas to test regulatory innovations, such as sandboxes, to enable trials of new innovations in a real-world environment with appropriate safeguards.

The Government should also streamline existing support schemes to make support more accessible to firms, especially small- and medium-sized enterprises, the committee said.

Third, it suggested that the Government consider using lead demand more systematically to support the development of promising industries.

"New but promising enterprises with short track records will benefit from citing the Government as a reference customer," the committee noted.

The Government could, for example, issue public sector challenges to encourage companies to explore, pilot and co-develop innovative solutions to specific problems, and set aside resources such as manpower and funding, to spur innovation procurement.

Fourth, Singapore should review and reshape its tax system.

Rising domestic expenditures due to ageing, and global changes in tax rules will necessitate a review of Singapore's tax system.

The Government should maintain a tax regime that is broad-based, progressive and fair, even as it raises revenues over time to meet rising domestic needs.

At the same time, Singapore's tax regime should remain competitive and pro-growth, the committee said.

Fifth, the Government should ensure that even as the economy grows, Singapore pays attention to the quality of the environment.

Given the threat of climate change, Singapore should play its part in contributing to global efforts to improve environmental sustainability, it added.

"In that way, we can maintain a high-quality living environment in Singapore for generations to come."