Question
Ms Tan Su Shan: To ask the Minister for Trade and Industry (a) what is the number of international companies that have exited from Singapore or have decided to scale down their operations significantly in the last two years; (b) what were the types of businesses that have chosen to exit and what were their reasons for doing so; and (c) how do these numbers compare with the trend in the previous five years from 2005 to 2010.
Oral Answer by Mr Lim Hng Kiang, Minister for Trade and Industry
Companies may choose to exit or downsize their operations in Singapore for various reasons. At the firm level, companies may restructure and consolidate their global operations as a result of changes in company strategy, business model or finances. Companies are also affected by the macroeconomic environment – for instance, companies in export-oriented or cyclical industries such as Electronics sector may decide to downsize during the industry down-cycle. At the industry level, the profile of our companies will change as our clusters move up the value chain and undertake more complex, value-adding and innovation-driven activities from Singapore. Such economic and industry transformation has been a continual process in Singapore’s economic history. Therefore, MTI does not find it meaningful to track a single indicator, such as the number of foreign companies that have exited or decided to scale down their operations.
MTI’s key focus is to ensure that Singapore’s business environment remains globally competitive, and that we continue to attract and anchor the right investments and economic activities into Singapore. We are mindful that significant changes in our domestic business environment, such as the foreign worker policy, can impact companies and businesses adversely, and will make it more challenging for Singapore to maintain its global competitiveness. Therefore, as we continue to restructure and transform our economy amidst the current tightened manpower resource considerations, we will continue to carefully pace out and calibrate the changes to ensure that the business environment in Singapore remains attractive and globally competitive. We will persevere in our efforts to build higher-value and more sophisticated manufacturing and services clusters to ensure our economy provides good jobs for our people and is diverse and resilient.