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Speech by Minister Chan Chun Sing at the launch of Mrs Lim Hwee Hua's book: "Government in Business: Leading or Lagging?"

Speech by Minister Chan Chun Sing at the launch of Mrs Lim Hwee Hua's book: "Government in Business: Leading or Lagging?"

Introduction

1. A very good afternoon to all of you. 

2. Thank you Hwee Hua for inviting me to the launch of your book, which I’ve had the privilege to read an advanced copy last month

3. This book is a timely reminder of the extraordinary times that we live in. As Hwee Hua pointed out, the pandemic has brought to the fore the role of Governments around the world:

a. From ensuring the health and safety of our people;

b. Securing vaccines and essential supplies;

c. To supporting businesses and workers to tide over the crisis;

4. Each of these decisions directly impact millions of lives and livelihoods. Globally, we have witnessed how they have sparked off collective reflection, over the duty and remit of Government.

Context: Singapore’s Unique Circumstances

5. However, the heart of this debate is not new. Throughout history, we have seen a plethora of theories on the role of Government. Some examples:

a. The Qin (秦) Dynasty, China’s first imperial dynasty, was anchored by Legalism.

i. An ideology that prized social order, strict adherence to rules, and strong state control;

b. In the West, the Keynesian school gained prominence during the Great Depression and post-war years, when Government spending and regulation expanded significantly.

c. This was followed by a return to more limited Government, and laissez-faire market policies in the 1980s.

6. The question of big or small, active or passive Government might be the subject of vigorous debates in some countries.

a. But here in Singapore, we have never been beholden to ideological or philosophical preconceptions.   

7. Singapore’s unique circumstances demanded the ingenuity of our people, public, and private sectors.

a. When the British withdrew their bases east of Suez, they accounted for about 20% of our Gross National Product.

b. Faced with a lack of natural resources, models could not simply be adopted. They had to be adapted for our own unique circumstances.

8. Then-Finance Minister Dr Goh Keng Swee was one of the chief architects of our early economic and national development.

a. When asked later about his visionary role, Dr Goh said. “I had no initial vision. You just start it and hope for the best.”

b. It’s not that Dr Goh set out with no aim or direction in mind.

c. But it’s about agility, humility and learning by doing. We don’t fall for our own plans, or let that blind us from challenging our own assumptions.

9. The 64 case studies featured in this book show that theory often sees unexpected deviations, when put into practice even with the best intentions. 

10. For Singapore, we distil the essence from different countries, different models, and tailor them to our own unique context.

a. Just like how we have done so for a multicultural, multiracial, multilingual society;

b. I think of our “model” of governance as one that evolves with time and in context.

c. This is something that we have never taken for granted, and is always a work-in-progress.

d. So instead of getting caught up in theoretical debates, we need to understand what works best for us, and apply it boldly, creatively, and judiciously. 

Shifting Global Trends

11. As a nation, we have weathered numerous crises, precisely because we have never been dogmatic about our approach.

a. Some of us might be tempted to see COVID-19 as a temporary disruption.

b. But the truth is that profound global shifts were already underway prior to COVID-19. And if anything, the crisis has accelerated many of these trends.

c. I would like to highlight three key trends, to get us thinking about the Government’s role in business.

12. First, growing geopolitical uncertainty is reshaping global trade and production patterns.

a. Major powers are facing increasing domestic pressures. It is unsurprising that many of them have become more circumspect about exercising global leadership.

i. Even before COVID-19, we were witnessing a shift in many supply chains from “just-in-time” to “just-in-case”, in response to the growing fragmentation of the global system.

ii. Now with COVID-19, we can expect further reorganisation through reshoring and diversification, to hedge against the vagaries of geopolitics. In fact, COVID-19 has made many to be conscious of the need to have resilient and trusted supply chains. Many corporations and Governments around the world are also re-examining the layout of their global production patterns and global supply chains.

b. Faced with a more unpredictable global order, how can Governments step up:

i. To be an active, integrative force on the global stage, and to preserve a rules-based system;

ii. While building a competitive and resilient economy at home to mitigate against the populist pressures that might distract and not allow Governments to take on their international leadership responsibilities

13. Second, rapid advancements in technology and digitalisation are changing the way we live and work.

a. During the pandemic, we saw the deployment of digital technologies – such as in teleconferencing, payments, delivery platforms, and e-commerce – on an unprecedented scale and speed.

b. We too had to adapt quickly. Hwee Hua mentioned the example of taxi and private hire drivers who were allowed to deliver food and groceries, to supplement their income while meeting the surging demand on delivery platforms.

c. Both in peace-time but especially in times of crisis,

i. The challenge is how do we enable businesses to transcend local markets, to create new products, service to not just serve the local market but the global market

ii. How do we equip our workers with the skills to capture these new opportunities?

d. I always encourage our businesses to strengthen their capabilities.

i. To compete on quality and standards, and not quantity or costs; to improve their speed-to-market, and also their speed-to-evolve. In today’s world, competition is not just about being able to produce better quality products. It is increasingly about our ability to evolve products, services, production systems and speed in response to the changes in the market.

e. This applies to Governments as well to keep pace with the demands of the market and businesses.

i. If we do not move quickly to foster the right environment  to allow businesses to mobilise capital, aggregate talent and protect intellectual property, we will be bypassed. By doing so, the Government will be able to attract a new generation of businesses that are less dependent on the previous factors of production.

ii. The ability to evolve will also make it difficult for us to be displaced in the global value chain.

14. Finally, we are also witnessing widening disparity in incomes, both across and within economies.

a. The gains of globalisation have not been equitably distributed to all. In fact, a recent UN report showed that more than two thirds of the world population live in countries with a growing wealth gap. 

b. If left unchecked, this will increase resistance to globalisation, trade openness and connectivity and regional integration. All of these are critical factors that have contributed to our success.

c. There are no correct answers or silver bullets – we are always dealing with trade-offs in public policy. In the face of this delicate balance, Governments must strive for the courage to:

i. Press on with sound, coherent and long-term policies;

ii. Help our businesses and workers embrace new realities;

iii. And ensure that the fruits of growth are enjoyed by all.

Moving Forward: Continued Role of the Government

15. So how do we continue to succeed, with our own unique set of Governance principles? If I may offer three hypotheses:

16. First, the Government’s role as regulator should not be seen as purely defensive play.

a. As Hwee Hua mentioned, regulation often lags behind innovation, especially when it straddles multiple domains, or when traditionally distinct sectors merge.

b. Our goal is not to play catch-up reactively. We want to be a proactive enabler of innovation, opportunity, and growth.

17. Our Pro-Enterprise Panel (PEP) plays a vital role in ensuring that we keep abreast of the concerns of our business leaders, entrepreneurs, and innovators.

a. Since its founding in 2000, the PEP has taken in over 2,000 suggestions. More than half of these have contributed to concrete regulatory changes.

b. I’ve spoken about our transition to PEP 2.0, which is about being progressive, enabling, and pioneering.

c. Through PEP 2.0, we want to optimise regulation at the systems level, to give businesses the bandwidth to experiment and scale up.

i. Let me share an example from the Singapore Civil Defence Force (SCDF). Recently, SCDF noticed that it was receiving about 6,000 applications a year, for “Temporary Change of Use” licences. These were usually from businesses who wish to use a particular venue for events.

ii. SCDF decided to automatically approve such applications, with the appropriate safeguards.  Once implemented, this will reduce both the waiting time for businesses, and the man hours we take to process such applications.

iii. Together with the PEP, the SCDF has taken a bold and risk-calibrated approach, to reduce costs for both itself and businesses. 

iv. This might not seem like a major move. But it is precisely incremental improvements like these, that cumulatively allow our industries to focus on growing their businesses and continually refresh our regulations.

d. Regulatory agility is therefore key. How can we ensure that our regulations are consistent, predictable, and serves the public interest, while allowing new business ideas to germinate?

i. Our regulatory sandboxes in FinTech, healthcare, energy, and more, play a critical role.

ii. PEP’s New Idea Scheme also enables businesses and agencies to accelerate and standardise the facilitation of new ideas, especially for those which might not fall neatly under current regulatory frameworks.

e. Through levers such as regulation, we will continue to ensure that our businesses stand ready to capture emerging opportunities in new sectors, so as to entrench ourselves in critical parts of the global value chain.

18. Second, if the market is unable to deliver a fair and just outcome to allow our businesses and people to fulfil their potential, then the responsible Government will step in, to balance social and economic objectives. 

a. As a small, open economy, issues of resource allocation relate directly to our survival.

i. From our public housing programmes and implementation of the Ethnic Integration Policy (EIP), which Hwee Hua mentioned;

ii. To mandating National Service soon after independence;

iii. None of these would have happened if left to the market alone.

iv. This may not always be popular decisions. But with the faith and industry of our people, they were given a chance to succeed. More importantly, we apply models in context for our own circumstances.

b. More recently, our efforts in ensuring our trade security and supply chain resilience show the vital role of the Government, especially in domains which businesses cannot navigate on their own, particularly in a crisis.

i. At the height of the pandemic, we sprang into action to keep our supply chains open and our trade flows moving;

ii. We also worked with our businesses and partners across all sectors in implementing their business continuity plans (BCP), from manpower to logistics and supply chains. It was a whole-of-nation effort.

iii. While border closures and trade restrictions created uncertainty around the world, we resisted the temptation to nationalise any essential goods, and sought instead to diversify our sources of supply.

c. In a world where populist voices often speak louder than sound policy, it is ever more crucial that we build a foundation of trust, and remain committed to the well-being of our people.

19. Finally, to achieve this, we will continue to strengthen public-private-people collaboration.

a. Our strong culture of tripartism between workers, businesses, and Government, has been a defining contributor to our success.

b. To solve the increasing number of wicked problems that we face today, we need to bring diverse groups together in finding common ground.

c. It’s not just the issues or outcomes that matter, but the solutioning process. How we get groups with diverse backgrounds and interests to unite,

i. To appreciate the multitude of aspirations that society wants to achieve;

ii. To bring out the best ideas and execute them together;

iii. And to find solutions that can embrace and encompass this diversity within our society.

d. Our efforts in open innovation challenges with government agencies and corporates, through the Open Innovation Network (OIN) and National Innovation Challenges (NICs), embody this spirit of collective problem-solving.

i. To give an example, older high-rise buildings in Singapore are required to undergo façade inspections. Several agencies   co-launched an innovation call for solutions in drone inspection technology, so that such inspections can be safer and more efficient.

ii. Five consortiums were selected, one of which was a team comprising Singapore startup Claritas Technology; its partner Third Element Aviation, a German drones startup; and the Nanyang Technological University (NTU).

iii. As the project required broad use of technologies across different domains, the teams had to forge collaborative partnerships, to bring their different expertise and capabilities together, in co-developing a solution.

e. We also continue to experiment with new modes of public-private collaboration. The Alliances for Action (AfAs) are one such example, where we adopt an agile startup approach, get the public and private sectors to come together, mobilise their respective sectors, to deliver quick pilots and prototypes.

f. Finally, we will look to send more public service officers on external attachments, and attract more talent from the private and people sectors.

i. Only when we facilitate more porous exchange of talent across different domains, can we seed more diverse ideas and perspectives, and develop more robust policy and implementation.

g. So moving forward, it is crucial that we continue to strengthen our engagement with our workers and businesses,

i. To ensure that our policies continue to serve the needs of diverse groups amongst us;

ii. And that we can progress together as a nation, to build a society with opportunities for all.

20. Ultimately, there is no secret formula.

a. Governance is about applying what is the most appropriate in each instance. Our role is both fluid and multifaceted.

b. But we are undergirded by immutable principles, which is our commitment to transparency, consistency, and accountability.

c. Our success thus far could not have been possible without cohesion and understanding, achieved through the high level of trust between people and government.

21. Perhaps the success for Singapore is that we were able to do the simple things consistently, cohesively and with discipline. So the secret isn’t with what we do but how we have done so.

22. This is where Hwee Hua’s book has come at an apt time. Going forward, there will still be many difficult problems for us to solve. But ultimately, the ability to get things done will rest not just on who has the superior solutions but who is able to execute the solutions well as a people. If we continue to maintain our cohesion and have the intellectual rigour to keep challenging ourselves, then I am confident that we will continue to do well.

Conclusion

23. As Hwee Hua had pointed out - there will not be a divide between the people, private or the public sectors if we are all in this together to define the future for ourselves, in context for our own circumstances. This is what makes Singapore special and different from many others.

24. Thank you very much. 


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