2018 - January
Welcome Address by ISCA President Dr Gerard Ee at the ISCA Pre-Budget Roundtable 2018 at the Four Seasons Hotel Singapore, Crescent Ballroom , on January 9, 2018 at 9am
09 Jan 2018 Category: Speeches
Mr Liang Eng Hwa
for Finance, Trade & Industry
Members of the Media,
Ladies and gentlemen,
Good Morning, and thank you for attending the ISCA Pre-Budget Roundtable.
1. 2018 Economic Environment
The challenges posed to globalisation appear to continue throughout 2018. Under the Trump administration, the US appears to be retreating from its preeminent role in the global economy. The US has been reviewing its trade agreements, particularly those with countries that have a large trade surplus with the US. This has caused some anxiety among the business community.
Nevertheless, trade in Asia is likely to remain strong, as political leaders in the region, including Singapore, have so far shown a propensity to keep free trade alive. For instance, members of the Trans-Pacific Partnership (TPP), of which the US has withdrawn from, have been determined to reach a deal.
For the Singapore economy, the full-year growth for 2017 has hit 3.5 per cent. This is up from an earlier estimate by the Ministry of Trade and Industry (MTI) of 2 to 3 per cent, due to a strong showing in electronics. At the same time, economists and tax specialists are speculating that the Goods and Services Tax (GST) is likely to be raised by two percentage points as Singapore’s spending needs continue to grow.
Disruptive technologies have changed the face of businesses, and continue to re-shape the business landscape. Technologies such as blockchain and Artificial Intelligence have started to catch on in mainstream markets, threatening to disrupt existing business models while creating new ones. As Singapore presses on towards achieving its goal in becoming a Smart Nation, how can Singaporeans embrace the digital economy?
2. Recap of Budget 2017
Before we go into a discussion about our wishlist for Budget 2018, perhaps it is useful to revisit the highlights of Budget 2017. Budget 2017 took a ‘learning and adaptive’ approach in trying new methods and learning from experience. The Industry Transformation Maps (ITM), which were first announced in Budget 2016, were implemented last year.
The Budget also included more help for workers with the ‘Attach and Train’ programme, which seeks to assist workers in finding jobs in new growth sectors. At the same time, the government also raised wage and training support under existing measures like the Career Support Programme, the Professional Conversion Programme and the Work Trial Programme.
To encourage businesses to venture overseas, the government has committed $600 million into an International Partnership Fund to co-invest with Singapore-based firms to help them internationalise. Further enhancements to the Internationalisation Finance Scheme were also made to enable firms to tap on the growing market for infrastructure development in emerging Asian economies.
3. The Digital Economy, Business Competitiveness, and Innovation
In addition to the grants to internationalise, small and medium-sized enterprises (SMEs) are getting an over $80 million nudge to go digital with the SMEs Go Digital Programme. Industry Development Plans for various sectors will give SMEs step-by-step advice on the technologies to use at each stage of their growth. Aside from monetary or tax incentives, how can companies be encouraged to adopt technologies? How can the government and industry collaborate to help address these issues?
A feedback we received during our focus group discussions held in September 2017 was that the criteria under the Inland Revenue Authority of Singapore (IRAS)’s Research and Development tax incentive is too difficult to meet, particularly for SMEs with limited resources. We would like to hear your views on this.
4. Jobs and Skills
The displacement of professionals, managers, executives and technicians (PMETs) is a growing concern. Trade Associations & Chambers (TACs) have been asked to play an active role in structuring training and developing training programmes for their workers and the industry.
One suggestion brought up was that companies need to be incentivised to hire mid-career switchers from the Professional Conversion Programmes. For instance, this may be in the form of enhanced tax deductions for salary expenditure on employees who have been hired through the programme. What are your thoughts on this?
I believe our panellists are ready to share their views on how we can contribute towards shaping a better Singapore through Budget 2018.
This year, the theme for our Pre-Budget Roundtable is “Partnering for Business Growth and Job Creation”. Our discussion today will be broadly structured around the following areas:
- Industry Transformation Maps
- Digital Economy and Business Competitiveness
- Jobs and Skills
We look forward to a vibrant and thought-provoking discussion with our panellists whom we have invited from diverse business sectors to share their views and recommendations on some of these issues.
Before we begin, I would like to express my sincere thanks to the panellists, as well as our observers from relevant government agencies, for taking time from their busy schedules to be at this roundtable.
I now invite my co-chair Mr Liang Eng Hwa to deliver his keynote address.
 The Business Times, “2017 growth hits 3.5 %; PM looks to new year with confidence,” 1 Jan 2018, http://www.businesstimes.com.sg/government-economy/2017-growth-hits-35-pm-looks-to-new-year-with-confidence
 Channel NewsAsia, “Industry Transformation Maps, stronger partnerships will help Singapore’s economy: CFE”, 9 Feb 2017, http://www.channelnewsasia.com/news/singapore/industry-transformation-maps-stronger-partnerships-will-help-sin-7627868