Transcript of Soundbite by Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong on the Launch of the Business Adaptation Grant (BizAdapt) at the visit to Forefront Medical

Thanks for being here. This morning, I am very happy to visit Forefront Medical, a medical device company. It is one of the leaders in some of the components in medical devices. In fact, in some areas they are the only supplier. They are growing and they are hoping to grow even faster. Of course, they are also grappling with the challenges of the tariffs imposed by the US. The reciprocal tariffs have now come into effect, and the US has also announced sectoral tariff, the latest is on pharmaceuticals. The implementation has been deferred, but I think it is quite imminent. At some point, it will come into effect and negotiations are underway.

This tariff creates uncertainty. In my discussion with Forefront, they also highlighted a few issues that they are thinking about. They are planning to expand, but they are also not sure where to site their plants. They have already sited some plants around the world - some of them are affected by the tariffs while some are in a stronger position, so they will need to see how they can reconfigure and rearrange their supply chains.

This is why we set up the Singapore Economic Resilience Taskforce (SERT). First, to look into the impact of the tariffs and to share with companies, get feedback from companies, on how the tariffs are affecting them and how we can lean forward to support them. This is why I am here to also get feedback from Forefront Medical. Another area that SERT is looking into is to look at what are the immediate measures that we can introduce to help provide relief, and to also help companies seize opportunities when such opportunities emerge. I think Forefront is also looking at restructuring, reconfiguration of supply chains and where the opportunities will be. Some companies will also have to relocate and whether there are other areas that Forefront can move into, I think these are opportunities that are emerging.

That is why we recently announced the introduction of the Business Adaptation Grant. We call it BizAdapt. Through BizAdapt, we hope to be able to provide support for companies who are impacted by the tariffs, either directly or indirectly. Directly, if you are exporting to the US, you face a new tariff imposed on you. Indirect, means that you may be exporting to other countries, not the US. Although you do not have a tariff in those countries, these countries are using your exports to put into products to export to the US, and their products are subject to the tariffs. Therefore, indirectly, you will also be affected. Both direct and indirect impact are something that we have to continue to watch and monitor, and BizAdapt will help to mitigate the impact of this tariff pressure, but also help them seize emerging opportunities [such as] to reorganise their supply chains, strengthen their resilience, and diversify into new markets.

With this market diversification, and even with existing supply contracts and delivery contracts, they would need to better understand the legal implications of these tariffs, and how they can adjust their contracts to be able to respond to the tariffs. So, BizAdapt will help to support costs incurred in the area of legal and contract agreement advisory.

What is also important, as raised during our discussion with Forefront, is that in the process of doing all this, they are thinking about how to reconfigure their supply chains. Some of the production capacity may have to be shifted to countries that have a lower tariff, and the process of doing so will take time, and require cost support. This is something that BizAdapt is also looking to be able to support them in. For example, in the process of restructuring a supply chain, you may have to produce in advance some of the stocks you carry to continue to supply to your customer. The fact that you need to carry more stock may also mean that there is higher costs. How we can support them in addressing these logistic costs is something that BizAdapt will be very happy to discuss with them and see how we can support their restructuring.

In essence, BizAdapt is focused on helping our companies to adjust and adapt to the new tariff environment. We have now finalised the details, and it is now open for application, starting from today. Companies which are eligible are welcome to apply for BizAdapt. We will process and work with them to see what are the services that they need and how we can support them through BizAdapt.

At the same time, beyond just supporting companies, we know that some of the workers may be affected, particularly fresh graduates. Many of them are concerned about whether they are able to secure jobs. I think the labour market generally is still quite robust. We have also rolled out GRIT (Graduate Industry Traineeships), a graduate training programme. We hope to be able to provide more training and internship opportunities for fresh graduates which will better prepare them for longer-term employment. It will be very useful for some of the graduates to apply. The application started some time ago. It is still early days – we have a lot of interest from graduates who want to sound out, explore opportunities through GRIT for internship and training. We are prepared to do more if necessary.

We will continue to monitor the situation and the developments in the tariffs, both on the company side as well as workers side. We are working with companies, and that is why I am here today, to understand what is happening on the ground. We are also reaching out to our employees, our unions to provide greater support in terms of career advisory and job placement, training and upgrading through GRIT as well as through our various skills upgrading programme. These are the collective measures that have been introduced by SERT to manage the impact of the tariff environment.

At the same time, within SERT, there is a third component which is to plan for the long-term economic restructuring. That is the new economic blueprint we are working on. We have announced five committees which are looking at five areas of economic strategy review. We gave a quick update recently in Parliament. I think the teams are working very hard, and hopefully by next year, we will be able to give a fuller report. We will continue to share with our businesses, our unions and our workers as and when we have updates for them. Thank you very much.