Positive Outlook For Singapore Economy In Immediate Future

With a strong pipeline of investments, the overall outlook for Singapore looks positive in the immediate future, said Minister for Trade and Industry Lim Hng Kiang.

However, he also cautioned that Singapore faces some challenges in the immediate one to two years – these include an ageing population and the task of matching Singaporeans’ aspirations.

Mr Lim was speaking during a visit to the Braddell Heights ward on Sunday (Feb 1) – his first visit in 20 years. During a dialogue with residents of the ward, he was asked for his take on Singapore’s future economy and population.

Citing a 2011 World Bank study of 101 middle-income countries, Mr Lim noted that Singapore was one of just 13 countries that managed to move from middle- to high-income, over a period of 50 years.

But he stressed that Singapore still has to be cautious: “What it means for us as we celebrate 50 years is – number one, it is not very easy to become a high income country; and number two, it is also not very easy to stay there.

“There is a lot of competition and if you mismanage like some countries – for example Greece – you can drop very quickly and the drop need not be gradual, it can be a very severe drop over a period of five years. As we look after Singapore and we look to our future, let us be careful and reinforce those things which make us successful. Let us also be careful not to fall down the slippery slope and end up with such problems.”

With investments coming into Singapore and local companies investing overseas, Mr Lim said he is confident that the country will be able to maintain steady growth of between two and four per cent. This is because of Singapore’s strong pipeline of investments, the Economic Development Board still being able to attract investments to Singapore, and Singapore companies investing overseas – which allow them to generate good jobs with their headquarters in Singapore to look after their overseas subsidiaries.

However, he cautioned that there may be some ups and downs. One challenge is the slowdown in Europe, China and Japan’s economic engines.

“We have to find new opportunities for our companies. But overall, we are still optimistic that we can generate the jobs and the big challenge now is how to match Singaporeans with these jobs,” said Mr Lim.


Thus the need for Singapore’s focus on education and training. “Human resource is the best and only resource that we have. Other resources, like land and energy, will face greater constraints. If you look at what we’ve achieved in the last 50 years and look ahead to the next 50 years, there’s optimism we can do more,” said Mr Lim.

He cited how in 1966, only half of Singaporeans continued education past the primary six level. This is reflected in a high percentage of the current workforce having primary and secondary level qualifications.

But Mr Lim noted that this demographic has changed – more than 50 per cent of those who are under 30 and entering the workforce are now graduates. Another 30 per cent are polytechnic graduates, with less than 15 to 20 per cent having primary or secondary school qualifications.

He said that while an increasingly educated workforce is welcomed, this poses challenges as well and the economy has to adapt: “If your restaurants depend currently on the older workers with less education to be serving them – 10 to 15 years from now, these people will not be in the workforce. Your new workforce are polytechnic diploma holders and graduates. Therefore, you have to restructure your service industry to cater for this new profile of workers.

“In MTI and MOM, we are very concerned and we study all these statistics very carefully… The objective given to us is to make sure we are able to restructure the economy, make sure we can generate good jobs that satisfy and meet the aspirations of our new workers.”

About 280 people attended the dialogue, which lasted for over an hour. Questions ranged from Singapore’s education system, to changing consumer habits and the Central Provident Fund. One participant also asked what the role of SMEs looks like in Singapore’s future. Mr Lim said that moving forward, it will be key to have a strong pipeline of startups and SMEs, and to facilitate local SME tie-ups with big companies and foreign SMEs.


Source: www.channelnewsasia.com

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