Singapore's challenge is to avoid economic scarring, emerge stronger from Covid-19: DPM Heng

Singapore must be mentally prepared for a long and uncertain battle, says Deputy Prime Minister Heng Swee Keat.
Singapore must be mentally prepared for a long and uncertain battle, says Deputy Prime Minister Heng Swee Keat.PHOTO: ST FILE

SINGAPORE - Countries around the world that are trying to contain the Covid-19 pandemic, including Singapore, must be mentally prepared that it will be a long and uncertain battle.

"We are actually fighting a very agile virus. Whenever there is any gap in our defence, it gets through, and multiplies exponentially," said Deputy Prime Minister Heng Swee Keat at the Nikkei Conference on Thursday (May 20).

The immediate challenge, he added, is to contain Covid-19 and avoid economic scarring.

Last year, the Government committed close to $100 billion - or 20 per cent of gross domestic product - in Covid-19 support across five Budgets.

Explaining the reason for providing this extensive support, Mr Heng said: "If companies were to be closed and workers retrenched, it will be very hard to rebuild when the situation gets better. So, maintaining that capability is very important."

At the same time, Covid-19 has accelerated changes ranging from digitalisation to sustainability, he added.

This is why industry transformation maps (ITMs) were launched in 2016 under the Future Economy Council (FEC), he said. These are road maps to drive transformation of 23 industries across manufacturing, built environment, trade and connectivity, essential domestic services, modern services and lifestyle.

To seize new opportunities in a post-Covid-19 world, the ITMs will be refreshed as part of a new plan over the next five years dubbed ITM 2025, with three new thrusts: incorporating the recommendations of the Emerging Stronger Taskforce; closer integration with research and innovation; and greater focus on jobs and skills.

Mr Heng, who is also Coordinating Minister for Economic Policies and chairman of the FEC, said: "We are looking at how to help companies adopt technology and innovation, re-engineer processes, and redefine jobs - which are very important when the population is ageing. We will also expand cooperation with other countries so that we can have a bigger market.

"Covid-19 has changed the rules of how many economic activities are conducted. The Emerging Stronger Taskforce has just issued a report, and I'll be incorporating that work into our plans."

The Government convened the 23-member task force last May to identify systemic shifts arising from Covid-19, and provide recommendations to the FEC on how Singapore could refresh, reimagine, or reset its economic strategies.

In a report released on Monday (May 17), the task force made recommendations to drive the Republic's transformation as a node for technology, innovation and enterprise.

They are: creating new virtual frontiers; seizing growth opportunities from sustainability; enabling global champions and growing an agile and strong Singapore core; institutionalising private-public partnerships through Alliances for Action (AfAs); and strengthening international partnerships, especially in South-east Asia.

While much of the world's attention is on the United States-China relationship, Singapore's good relations with its partners extends beyond these two countries, said Mr Heng.

Stressing that constructive competition can help promote innovation and new solutions, he said he hoped that Singapore will continue to work closely with all of its key partners.

Mr Heng said: "I hope that we take a open, inclusive approach to our relationships across the world."