The challenge of moving the Singapore economy up the innovation ladder, from being one that is “value-adding” to a “value-creating” one, will be a key focus of the team set up to chart the Republic’s economic direction.
Finance Minister Heng Swee Keat, who will chair The Future Economy committee, framed Singapore’s challenges through the lens of the “five futures” – of jobs, of companies, of resources, of technology and of markets.
On jobs, Mr Heng noted that “it may not be immediate but if we look at a 10-, 15-year timeframe, the nature of jobs will change”.
With 3D-printing and additive manufacturing changing how factories are being configured, Mr Heng said, “how do we build skills and redesign jobs so that workers can be at their best and that talent can be maximised?”
He was speaking to reporters after a closed-door dialogue with business leaders at the Singapore Business Federation on Wednesday (Oct 28).
A second key challenge is that the “future of companies” will be marked by the rise of disruptive business models and competition from abroad. So staying competitive means exploring “cooperative platforms” for different business clusters to cooperate with one another and maximise capabilities, said Mr Heng.
Technology undeniably presents a challenge and, while Singapore has invested heavily in education, research and development, the “future of technology” hinges on how this can be translated into innovative processes, said Mr Heng.
But not all innovations are technology-related and another challenge, the “future of resources”, looks at how to organise one’s resources like land or staff in creative and competitive ways, he added.
A fifth area, the “future of markets”, is important because if firms expand overseas, “we transcend the Singapore market, we achieve scale”, said Mr Heng.
The formation of this committee was announced by Prime Minister Lee Hsien Loong earlier this month as Singapore faces a leaner workforce, tapering growth and a weaker global economy.
Yesterday, Mr Heng also announced that Mr S. Iswaran, Minister for Trade and Industry (Industry), will be deputy chairman of the new committee and is now helping him to select other members from a shortlist. The line-up will be announced by early December.
Mr Heng said the team will measure success by the opportunities and jobs it creates for Singaporeans, since a shift to higher skills indirectly addresses productivity issues. “Higher skills, higher productivity, higher wages – that is the virtuous circle that we hope to achieve.”
This is in contrast to the hard annual productivity growth targets set out by the last economic review committee in 2010. The report and its recommendations are expected to be issued a year later.