Speech by Mr Sam Tan, Parlimentary secretary, ministry of trade AND
industry & MINISTRY OF INFORMATION, COMMUNICATIONS AND THE
ARTS, at the 2nd EDC Conference, Concorde Hotel,
9th March 2010, 9:15 am
Mr Renny Yeo, President of the Singapore Manufacturers’
Federation and Chairman of the 2010 EDC Conference Organizing
Committee
Distinguished
Guests
Ladies and
Gentlemen
Good
Morning
I am happy to
join you today at the second Enterprise
Development Centre or, EDC
Conference.
A Challenging 2009 for
Enterprises
2. Last year was a very challenging year for many
enterprises. The world went through a serious financial crisis that triggered a
severe global economic downturn. Our government responded
very swiftly with a $20.5 billion Resilience Package in last year’s
budget. There were many innovative measures in that budget like job
credit and Special Risk Sharing Initiative (SRI) scheme and so on,
which had provided businesses with more support. For those
companies who want to go overseas, they also provided with adequate
support to venture
abroad.
3. We are now seeing
encouraging signs of a recovery. With considerable
improvement in the external economic environment, we now expect the
economy to grow between 4.5 to 6.5 per
cent.
Looking ahead – New Strategic
Direction
4. And while the next five to 10 years will
present numerous challenges for Singapore as we continue on the
path to recovery, there will also be opportunities for growth,
especially with an emerging Asia. The government recently announced
that this year’s Budget will focus on building up the capabilities
needed to capitalise on these opportunities and transform our
economy over the next decade.A number of programmes and initiatives
have been announced to help our companies grow
into globally competitive companies. A key target group to
benefit from these business initiatives is the SME sector.
SMEs[1]
as we know constitute 99 percent of all
enterprises in Singapore. SMEs employ 6 in 10
workers[2]
and contribute about half of Singapore’s GDP.
It is an important and crucial group. They are an integral part of
plans to bring our economy to a higher
level.
5. It has also been heartening to hear that even with last year’s
less than conducive economic conditions, many SMEs continued to
venture abroad and do business.
69 percent of our SME community has done so successfully, a rise
from 65 percent in the previous year.
These companies realise that in order to
grow, they need to internationalise and tap larger markets outside
Singapore. I hope many more SMEs will take advantage of the
new budget initiatives to further expand their internationalisation
efforts.And I encourage those who have yet to venture overseas to
seriously consider doing so.
Partnership between Government and
TACs
6. Apart
from these budget initiatives, there is also strong support
provided by our business associations to help companies ready to
train their sights abroad.The government in fact recognises the key
role that our trade associations and chambers of commerce play in
helping our companies internationalise. As announced at this year’s
budget the government is committing $100 million over five years to
scale up our support for business associations to drive
productivity at the industry level, and also to facilitate
international market access for their
members.
7. This additional support underscores the
importance of the close working relationship between the Government
and the trade associations and chambers or TACs. Together, we help
facilitate the development of SMEs through programmes like the
Local Enterprise and Association Development (or LEAD) Programme
which is jointly managed by SPRING and IE Singapore. It aims to
enhance industry and enterprise competitiveness. LEAD provides
focused and customised support at the industry level. It does so
through partnerships with industry associations that are willing to
take the lead in industry development and drive initiatives to
improve the overall capabilities of SMEs in their industries. Much
progress has been made since the programme was launched in
2005.Some $47 million has been committed to support projects by 22
TACs.These projects will help some 8,000 SMEs upgrade and access
new markets opportunities; and create some $1.4 billion in
value-added and $3.1 billion in revenue for the participating
companies. So you can see that there is a lot of potential that
SMEs can leverage on.
Enterprise
Development
Centres (EDCs)
8. EnterpriseOne is another key initiative
where the government has worked closely with TACs. Besides
maintaining a web portal hosting comprehensive government
information and e-services for businesses, there is also a network
of five Enterprise Development Centres (or EDCs) set up jointly by
SPRING and the various associations. These EDCs serve as a conduit
for SMEs within the enterprise eco-system, allowing them to seek
information and advice on government assistance for businesses and
on tackling business issues.Let me cite two examples of how these
EDCs have assisted SMEs.
9. ROHAG Singapore Pte Ltd, a manufacturer of components
and parts for the oil and gas industry, approached the
EDC@Singapore Manufacturers’ Federation (SMa) in 2008 for help in
developing a strategic performance improvement plan. The EDC helped
ROHAG to leverage on one of SPRING’s programmes to develop a
roadmap for building their capabilities in key business areas. In
turn, this has enabled ROHAG to address its business gaps and
improve management performance.
10. In the
second case, a company called Sri Vinayaka Exports, a trading
company, saw the potential to expand into the retail business. Its
founder and CEO, Mr J
Manickavachagam., had initially
approached the EDC@Singapore Indian Chamber of Commerce and
Industry (SICCI) to seek help on its packaging design. However, on
the advice of the EDC, he decided the company should also develop a
brand strategy to strengthen its foray into retail. The company is
now more confident of entering the retail market and its designed
products will hit the shelves in early April this
year.
11. To-date, over 36,000 SMEs have been
assisted through the EDCs.Their extensive links with the SMEs
proved invaluable when they helped reach out to more than 16,000
SMEs to disseminate key information and advice on the various
government measures available for businesses last year.The EDCs
also initiated the Financial Facilitator Programme in January 2009
to help SMEs that had been harder hit financially gain access to
loans and alternative financing during the credit crunch. They
handled more than 3,400 enquiries from distressed SMEs and managed
to secure $46 million of bank loans for this group of
companies.
Conclusion
12. The next few years will be critical for
Singapore as we set out to build deeper capabilities and expertise
to bring about a sustained growth.More than ever, TACs will have a
key role to play in the development of our enterprises and
industries.Given the unique position of the EDCs, I encourage them
to aim for providing an even wider suite of services to our SMEs in
Singapore. For example, in the areas of market access facilitation,
credit and legal advisory and mentorship. In so doing, the SME
community will be better served in terms of their business
needs.
13. I would like to conclude by
thanking all the five EDCs for organising this conference. I wish
you all fruitful discussions and success in networking with
like-minded companies.
Thank you.
[1]SMEs
in the manufacturing sector are defined as enterprises with net
fixed assets < $15mil. For non-manufacturing sectors, SMEs are
defined as enterprises with employment size < 200
workers.