Charting A Course For Singapore's Future Economy

The CFE has crafted 7 strategies to secure Singapore's long-term prosperity, but we hope this year's Budget will provide assistance for more immediate challenges.

singapore future economy

Author: Joyce Tee, Managing Director and Group Head, DBS SME Banking

With Singapore facing challenges on multiple fronts, the recently released Committee on Future Economy (CFE) report has laid out a plan for Singapore's future economic direction as it navigates an uncertain road ahead.

As a person passionate about entrepreneurship, it was heartening to see that developing local enterprises was one of the seven core strategies highlighted by the committee.

Among other things, it wants to help high-growth enterprises grow through targeted assistance, by providing them access to networks, mentors, technology and financing. Furthermore, it seeks to encourage a range of private sector funding, including from banks, venture capital funds, and private equity funds to help Singapore-based businesses scale up. These are areas where financial institutions like DBS can play a part.

Beyond these measures, however, I believe that more can be done for our SMEs.

Grooming of Talent & Disruptive mindset

Firstly, we need to develop a pool of entrepreneurial talent with disruptive thinking that can help our local businesses grow into global champions.

Ideally, this grooming of talent needs to happen at an early stage of their development. One way to do this is to develop a nation-wide programme for schools to send their students for internships at SMEs.

However, these cannot be run-of-the mill internships where students are used to carry out low-level tasks. Rather, they should be deployed more purposefully by assigning them a real business problem that they are tasked to solve.

Working in teams, they should be given access to resources such as tech developers to help them craft a feasible solution. Done this way, these young talents will have a taste of how the real business world works. More importantly, they will start developing an entrepreneurial mindset at a young age.

Exporting Solutions

SMEs also need to leverage on government agencies and multinational corporations to gain insights on what business opportunities are available globally. For them to grow, they need to know what the world needs in order to make products or develop exportable solutions that will be in demandin the international market place.

To that end, it is encouraging that the CFE is urging for greater collaboration to support local enterprises. Specifically, it wants the Government to create an environment where trade associations and chambers, unions, enterprises and individuals can work together. The committee also wants more tie-ups between enterprises, especially between smaller companies and larger ones.

Facilitating collaboration

If we are committed to build a culture of that is serious about delivering real solutions that meet customer needs, a strong partnership ecosystem is more important than ever. This will not only help SMEs build digital capabilities, but also help them scale up faster and be nimbler.

At DBS, we help to facilitate such partnerships through a variety of initiatives. DBS Techmatch, for instance, matches local SMEs with tech firms around the world that can develop technology solutions to addresstheir most pressing problems.

Our customers that have benefited from this scheme include children's clothes retailer Chateau de Sable, who adopted a cloud-based inventory management solution from another one of our customers - Singapore-based startup BiTs, to help them better manage their stocks.

In another customer case, Triple3, the distributor for American sportswear brand Under Armor®, implemented a game-based HR system developed by Australian tech firm Arcade that we had scouted, to help them more effectively retain and develop talent.

Through Techmatch, these and other firms have implemented solutions in just months, and at a fraction of the cost of building one from scratch. For more complex and larger scale innovation projects, we can provide funding support through schemes likeSpring Singapore'sCapability Development Grant.

We are looking to accelerate these efforts by working with like-minded agencies to help SMEs find the partners they need to grow their businesses.

Immediate assistance

While the CFE's proposed strategies aim to position Singapore's economy for growth in the long run, we must not forget that there will be a period of painful transition for many SMEs as they transform themselves for the new economy.

What I hope to see in the upcoming Budget announcement is a set of measures that will give them more immediate assistance to help them make that difficult leap. My wish is for Budget 2017 to be a business friendly one that devotes resources to helping companies cope with the economic challenges they are currently facing.

These measures would supplement last year's SGD 4.5bn Industry Transformation Programme that aims to promote innovation and deepen capabilities across industries and within individual enterprises.

Some short-term initiatives to help SMEs could include tax rebates and subsidies to defray the costs of training workers. Other measures to support SMEs' adoption of digital technologies - one of the core strategies of the CFE report - would also be welcome. With analysts projecting a Budget surplus, the Government will have the ammunition to provide such assistance.

In addition, a more impactful Automation Support Package with a bigger grant quantum and higher risk-sharing by the government to help companies invest in digital technologies, additive manufacturing and robotics would be welcomed to help companies gain firmer foothold in overseas markets.

Ultimately, we want to help today's entrepreneurs build businesses that are not only disruptive but also sustainable.

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