Mr Seah Kian Peng: To ask the Minister for Trade and Industry what is the assessment of industries in the post-COVID-19 era, specifically which are those that the business community and workforce should pivot to and position themselves going forward.
Oral Answer (to be attributed to Senior Minister of State for Trade and Industry Mr Chee Hong Tat)
1. COVID-19 is an unprecedented crisis with impact extending far beyond that of public health. It will change the global economy and social norms in far more significant ways than past crises. We will likely remain in a COVID-19 environment for some time, and even when the pandemic recedes, life would not return to what it used to be.
2. Trade flows will be affected by the reconfiguration of supply chains. Some countries will respond by home-shoring certain production, while others will strengthen their inter-dependence with other economies and diversify their supply chains. How people travel will also change in ways more significant than after 9/11. Companies will need to transform their business models and operations, and manufacturers will have to redesign their ‘just-in-time’ production to balance between achieving efficiency and resilience. The pace of digitalisation will accelerate and play a more fundamental role in the way we work, live, and play.
3. As a small and open economy, Singapore’s response cannot be to turn inward. We need to find our new relevance to the world. Even as we cope with the immediate challenges, there will be new opportunities that we can seize, we can leverage our strengths and we can ride on the key shifts brought about by the pandemic. While some of these developments are still playing out, and there is still some uncertainty in terms of how the new landscape would look like, there are a few areas our businesses and workers should start to re-position ourselves for.
4. First, changing consumption preferences, coupled with a rising middle class in Asia, will drive new demand. While the pandemic is still panning out, some changes, including those that started even before COVID-19, have become evident, such as a renewed emphasis on health and an increased focus on sustainability. If this continues, it will benefit industries such as healthcare, online retail and financial services, just to name a few. We will have an opportunity to enhance our value proposition in these areas to capture the growth in demand.
5. As Asia continues to grow, we must also work together with our neighbours to capture new opportunities. For example, in the agri-food industry, we are building up our local food production capabilities, and also working with neighbouring countries such as Brunei, to grow this as an exportable sector that can strengthen food security and create good jobs for our people.
6. Second, global supply chains will be reconfigured as businesses seek to balance efficiency and resilience. This started before COVID-19, and we can expect the pace to accelerate. As companies shift their production lines, our manufacturing and logistics industries should position themselves to serve new demand and participate in new supply chains that are formed. We must continue to compete on our strengths such as trust, quality and connectivity, which have become even more important to investors and customers in the new environment. This is where our biomedical and precision engineering industries can play to our advantage by leveraging sophisticated technologies and the trust and quality that have been associated with Singapore. Our trusted brand name is an asset in this environment. If we can move fast to capture the opportunities created by these shifts, Singapore will be in a stronger position when recovery comes.
7. Third, the digital economy will take on greater salience than before, and we must be prepared to seize the opportunities it brings. The pandemic has compelled businesses in all industries to turn to technology-enabled platforms for safe operations and business continuity. Besides shoring up a strong demand for digital solutions in the ICT sector, the quickened pace of technology adoption across industries has also transformed business models, especially for traditionally brick-and-mortar industries such as retail and food services, and enabled these businesses to access broader markets and consumer segments than before. For essential services such as healthcare, the rise of tele-medicine also provides an opportunity for the industry to redefine service quality and access markets beyond Singapore. Businesses will need to pivot towards the digital economy, and the Government will continue to extend strong support to help our enterprises to transform their business models and to train our workers in new skills to prepare them for this digital economy.
8. As a country, Singapore has time and again reinvented ourselves to be relevant to the world. We can recover from this crisis, and we will grow again. Global competition will be intense. The road ahead will not be easy, but we will walk this journey together. The key is to remain united and support one another to transform ourselves to seize new opportunities. We need to strengthen Singapore’s attractiveness as a hub for business and investments, and remain open to global trade and talent to benefit from Asia’s growth. How well we recover will depend on our adaptability as a country, as businesses, and as individuals. We start from solid foundations – a trusted brand name and rule of law, a cohesive and hardworking people, a strong tripartite partnership, and excellent connectivity with the rest of the world. With these strong fundamentals, I am confident that Singapore will survive the crisis and we can emerge stronger.