Total rethink needed for S'pore economy to stay relevant: Business leader

It will not be business as usual any more for Singapore's economy in the future, and this requires good foresight and preparation on all fronts for whatever changes that may come, business leaders have told The Business Times (BT).

Their comments, captured in BT's first Views from the Top survey for the year, come ahead of a seminal report that will recommend ways in which Singapore can chart its future economic direction.

Chief among these corporate chiefs' expectations of the report are how the economy and workforce can deal with disruptions, and how small and medium enterprises (SMEs) can play a larger role in the economy.

"Moving the pieces on a chess board is tactical. Moving the entire chess board so that it gives you an overall advantage is strategic," said Eric Lew, executive director of Wong Fong Industries.

"I would like to see a strategic shift rather than a tactical one."

The 30-member Committee on the Future Economy (CFE), chaired by Finance Minister Heng Swee Keat, is due to release its recommendations later this month on how Singapore can reconfigure its economy.

Corporate chiefs and business leaders that BT spoke to stressed that the CFE report would be a good opportunity to see how Singapore can remain relevant in this new landscape.

They were responding to a BT poll on the most important issue that should be addressed by the CFE on keeping Singapore competitive. Some 59 responses were collected.

One thing was clear among all of their replies - Singapore's economy needs a thorough rethink so that it can remain relevant for years to come.

"We are not just looking for answers to today's challenges. We have to look for solutions for problems that don't even exist yet," said Uantchern Loh, Asia-Pacific chief executive of communications consultancy Black Sun.

Therefore, the CFE's recommendations are seen as a chance to reignite confidence in Singapore's future, at a time when it is grappling with slower growth.

In 2015, the economy expanded by 2 per cent, one of the slowest since 2009 in the throes of the recession.

Early estimates for 2016's full-year growth is around 1.8 per cent. It will be updated in February.

Economists are also anxious that while they see a global pick-up this year, Singapore is unlikely to benefit from it.

At the same time, business leaders told BT that business confidence is low, and the labour market is weak.

These factors make the CFE report even more crucial, said David Emery, founder and chairman of investment advisory Reciprocus International. "Substantive recommendations on these themes would reinvigorate optimism and hasten efforts to build the globally competitive companies which will ensure Singapore's future prosperity."

But before the report is made public, these corporate chiefs said that at the very least, all stakeholders must be equipped with the skills and knowledge to remain nimble in the face of future challenges.

"To thrive and succeed in today's VUCA environment, Singapore must continue innovating new products and business models that achieve commercial viability," said Martin Hayes, president of German conglomerate Bosch's South-east Asia operations, using an acronym that describes the volatility, uncertainty, complexity and ambiguity of situations.

Hence, companies must be open to new ideas and workers must be adaptable to remain competitive.

This way, "innovative and effective solutions to issues will follow", said Mark Billington, regional director of ICAEW (Institute of Chartered Accountants in England and Wales).

Beyond the workforce, students must also be prepared for the new economy.

Toby Koh, managing director of Ademco Security Group, said that young minds should be exposed to design, innovation and business processes in school.

"This will inspire our young to think and imagine, and stir their interest in the various fields of study," he said.

Business leaders also stressed that SMEs have a critical role to play in the future economy.

With larger companies increasingly attracted to China so that they can compete with Chinese companies, SMEs can fill the void in ensuring Singapore's survival, said Lim Soon Hock, managing director of corporate advisory firm PLAN-B ICAG.

Thus, clear strategies in helping SMEs and their employees should be laid out in the CFE report, said Tan Mui Huat, who is Asia's president and chief executive officer of travel risk services company International SOS.

"To remain relevant in today's constantly disruptive landscape, we need to drive innovation and productivity through education," he said.

This article was first published on Jan 09, 2016.
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