Commentary: While external environment may be adverse, Singapore has many important strengths

This is the third of three commentaries by Prime Minister Lee Hsien Loong based on the Chinese speech he delivered at National Day Rally on Aug 19, 2019.

Read the first on the Singapore identity and the second on the impact of US-China tensions on Singapore.

SINGAPORE: This year, our economy has slowed down significantly. This is primarily due to weakening global demand and international trade, which have impacted our manufacturing sector and trade-related services.

A cyclical downswing in electronics has affected our broader economic performance, especially in related sectors such as precision engineering and wholesale trade. The retail sector also continues to be under pressure from online shopping.

READ: What slowing growth means for the man in the street, a commentary

Thankfully, other sectors have so far not been very much affected. Retrenchment and unemployment rates remain low. Recently, I discussed these issues with NTUC secretary-general Ng Chee Meng and with union leaders. They reported that while workers are worried, the slowdown has so far not significantly affected jobs.

Thus, the current situation does not warrant immediate stimulus measures. But if the situation worsens significantly, we will intervene promptly and appropriately to sustain our economy and the livelihoods of our workers.

The Government and union leaders are watching trends closely, and are fully prepared. We have experienced cyclical downturns like this in the past, and we are confident we can take this in our stride.

READ: Singapore and the dreaded R word – recession, a commentary

IMPORTANT STRENGTHS

Though the external environment may be adverse, we do have important strengths. This year, we attracted several major investments.

One of these is by Finnish energy company, Neste, which is investing more than S$2 billion to expand its renewable energy plant here. This is a huge project which will create quality jobs for Singaporeans.

Neste’s CEO, Peter Vanacker, explained that his company chose Singapore because of our technological capabilities, our excellent business environment including infrastructure and logistics, and our extensive trade relations. And more importantly, they were looking for the best workforce in the world.

Neste also had high praise for the Economic Development Board (EDB). In sum, they chose us because they trusted EDB, our workers and Singapore.

As the Neste CEO said: “The most valuable resource in the world is trust. But to find trust one must earn it first. And to keep trust, one must continue to earn it. And here in Singapore, we have found the right people.”

This shows Singapore’s high reputation among investors. Facing economic uncertainties as we do, it is all the more crucial to work hard to protect this trust that investors have in us.

SUPPORTING BUSINESSES AND WORKERS

Meanwhile, we must keep on strengthening our economic fundamentals to secure our longer-term competitiveness. Deputy Prime Minister Heng Swee Keat and the younger ministers are leading our economic transformation efforts. Their efforts are beginning to bear fruit. 

With the support of the Government, our companies are innovating, digitalising their operations, expanding in overseas markets, and training their employees.

The Jumbo Group is a good example. Well known for their chilli crabs, Jumbo started in 1987 and is now a listed company that has expanded internationally.

Jumbo’s success is in large part due to its emphasis on training and development. This has helped it to retain Singaporean staff, in an industry that typically has a high turnover rate. By tailoring training to employees’ individual potentials and providing good mentorship, Jumbo has enabled its staff to upskill and grow with the company.

Like 31-year-old Ng Zi Yang, who became an executive chef overseeing a cluster of restaurants today, only 10 years after entering the industry as a complete greenhorn.

Jumbo has joined Enterprise Singapore’s Scale-up SG programme. This new programme helps promising local companies grow rapidly and stand out in their fields.

Jumbo’s CEO Ang Kiam Meng himself recently attended a leadership programme in the US. The participants were all from the pioneer batch of 25 companies on Scale-Up SG.

They are a diverse group, ranging from F&B to education, from furniture and maintenance to hospital and dental. If they came together, they could provide comprehensive services for an HDB township. On the course, they made friends, shared experiences and discovered potential opportunities to collaborate.

I mention Jumbo for several reasons. Firstly, to remind employees to upskill and retrain, to remain relevant and employable. Secondly, to encourage companies in their transformation efforts. And thirdly, to assure both employers and employees of the Government’s full support in their upskilling and upgrading journey.

There are many Government support schemes to help local enterprises develop and expand their businesses. This means more good jobs for Singaporeans.

UPHOLDING TRUST AND UNITY

The Government is paying close attention to how the international situation is impacting us externally and domestically.

The high trust that other countries and investors have in Singapore is a vital advantage and our precious asset. We must uphold this trust, so that we can pass it on to future generations. Then Singapore can continue to prosper and our livelihoods can be assured.

LISTEN: The Pulse: A rougher ride ahead? The outlook for the Singapore economy

I worry greatly that the coming decade will be more troubled than the last. Like the weather that is ever-changing – sweltering one minute, pouring rain the next – we will be buffeted by unexpected developments.

We must prepare for this future, and with the same intrepid spirit and drive of our forebears, work together to overcome the difficulties ahead.

I firmly believe that if the Government and people are united, Singaporeans can continue to enjoy ever better lives, and Singapore will continue to shine in the world.

Lee Hsien Loong is Prime Minister of Singapore.