SINGAPORE - Despite numerous initiatives rolled out by the government to help small and medium enterprises (SMEs), their Budget wishlist continues to revolve around incentives and subsidies, a UOB survey found.
According to survey respondents, 26 per cent are looking for incentives/help for overseas expansion, 25 per cent are looking at government-backed financing schemes for SMEs and 20 per cent are looking at incentives/subsidies for technology investments.
"What we found is that even though the government has rolled out so many initiatives - be it helping businesses with investments to rely less on labour or to set up operations overseas - SMEs are still saying, 'There's not much help, can we have more?' '' said UOB economist Francis Tan.
This suggests, said Mr Tan, that while there are channels available to SMES - for instance, the SME Centres - these may still be lacking in terms of effectively raising awareness.
"How many SMEs actually go to the SME Centre to seek help? Some may be willing but are not able to go down to the centre because they are fighting fires day to day . . . The question is - have SMEs gotten the funding and think there's still not enough or are they not aware of these grants?
"There is a need to relook the transmission mechanism rather than just the amount (of money disbursed to SMEs)," he said.
The SMEs polled are overwhelmingly turning to internationalisation (nine in 10) as a means of growth.
About 60 per cent cited rising costs in Singapore while 59 per cent said limited growth in the domestic market is the main reason for expansion. A further 29 per cent said a shortage of skilled labour in Singapore is pushing them overseas.
The top expansion destination is South-east Asia followed by China and other parts of the Asia-Pacific region (Japan, South Korea, Australia).
Meanwhile, businesses are looking to increase productivity by investing in technology (69 per cent) and forming strategic partnerships and developing new solutions (62 per cent). A further 57 per cent said they are looking to invest in employee training and development.
This article was first published on March 22, 2016.
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