INTRODUCTION

1.     Madam Chairperson, may I have your permission to display some slides on the LED screens later on in my speech.  Several Members have spoken on issues that affect our SMEs.  I thank them for their comments and suggestions.

2.     Creating a vibrant, productive and competitive SME sector is crucial to our restructuring efforts.  Restructuring has not been easy for many individual SMEs.  This is why the Government has adopted a middle-path approach in our restructuring efforts, to ensure that the pace is neither too fast nor too slow.  On the whole, we are seeing many positive signs that the SME sector is trying to transform and improve capabilities.  More SMEs are internationalising and investing in technology.  The entrepreneurship scene is also robust.  Firm formation rose from 54,000 in 2010, to 77,000 in 2014. In comparison, firm closure has held steady at between 40,000 to 42,000 in the same period.

 

3.     Madam Chairperson, may I now speak in Mandarin:

 

4.     蔡其生先生在演讲中提到了“传统行业”的问题。许多行业，特别是历史比较悠久的“传统行业”内，中小企业占了显著的比重。其中，很多是家喻户晓的老字号。它们随着新加坡的发展而成长，也是我们企业生态系统中的一个重要环节。随着经济转型，传统企业也必须与时俱进，才能有效地竞争，应对新挑战 。

 

5.    这些中小企业大多是家族生意，在规划接班和吸引人才方面面临一定的挑战。尽管如此，这些“传统行业”的中小企业如果能不断创新、积极寻求开拓海外的商机、加强人才管理和培训，必能继续取得增长。

 

6.     杨木光议员之前说了一段老虎吃人的故事。故事结尾是说一个人把鞋子脱了爬上树，躲过了老虎这一劫。但是，他不可能在树上呆一辈子。换了鞋子的人被吃掉了，这说明我们要有伸缩性，才能寻求生存的机会。但如果把故事延伸，躲在树上的人也不可能一辈子躲起来。他必须找到新的方法，从一棵树跳到另一棵树。或者，想想如何制服那只在树下等待的老虎。这需要创新、与时俱进、往前走，不能呆在那里等一辈子。因此，我们的商家和中小企业必须不断摸索和研究，研究自己的运作方式如何创新，怎样利用资讯科技将自己的传统行业转型成先进的行业。“传统行业”中有许多成功的企业。它们能够把握先机和市场定位，取得良好的发展。本土品牌老曾记就是一个很好的例子。它在1956年从一个小摊贩起家，至今成为挂牌的上市公司。目前，老曾记在本地有约 80家分店，并进军马来西亚，印尼，澳洲等海外市场。老曾记不断地推陈出新、改变其经营模式，以跟上时代的步伐。在标新局的协助下，老曾记在2013年推出“咖喱时光” (Curry Times Tingkat)的品牌。这是一家全自助服务概念的餐厅。顾客们可通过自助点餐机点餐和付款；按号码自行取餐。这种运营模式使得企业能提供更快捷的服务，而且这样的一个自助餐厅只需要5名员工，比相同规模餐馆所需的15名员工要少得多。

 

7.     要强化和壮大我们的中小企业，需要大家的配合与努力。政府致力于帮助各行各业提升企业的生产力及竞争力。无论是“传统行业”或新型行业，所有中小企业都能从政府所提供的广泛援助计划中受惠。有些计划也能较针对性地帮助“传统行业”的企业解决它们所面对的挑战。我稍后将会介绍这些政府计划。

 

8.     与此同时，商会应该扮演领头的角色，协助中小企业提高竞争力。

 

9.    蔡其生先生询问政府将如何辅助本地商会的发展。中小企业的规模庞大而广泛。政府机构、商会和其他合作伙伴必须齐心协力，才能有效帮助中小企业。例如，通过本地企业与协会发展计划(LEAD programme)，政府给予本地商会在企业发展项目和自身能力提升方面提供资助。

 

10.     规模较大的商会一般具有有效的组织单位，会员人数众多，自然更有能力推出有益于行业发展的项目。规模较小的商会则通常因为资源有限，难以提供相同的服务。

 

11.     为了帮助这些较小规模的商会，裕廊集团（JTC）将设立一个商团中心（Trade Association Hub）, 将个别商会汇集在同一个屋檐下。这对商会有三大好处：首先，商团中心将能够促进商会以及各行企业之间，在技能提升和开发商机方面的合作。例如蔡其生先生刚才提到的食品厂商联合会，它们就能受惠。

12.    其次，较小的商会将能在行政方面或组织方面上获得大商会的协助和指点。

 

13.     第三，商会也可通过共用资源和设施，减低运作成本。最终，受惠的将是商会旗下的会员们，因为在商团中心里，有更多广泛的项目和计划今后可能可以开放让会员参加，非常方便。

 

14.     我很高兴宣布新的商团中心将座落于裕廊集团的iHub, 也就是大家所熟悉的“前裕廊镇大会堂” （Old Jurong Town Hall）。 这是新加坡在建国初期推行工业化政策的起源点。我们希望这具有历史意义的地点将能给本地企业，特别是中小企业，带来启发，继续坚持不懈地转型和提高生产力、茁壮成长。

 

 

4.     Mr Thomas Chua asked about traditional sectors.  Many of our industry sectors, particularly the more mature, or “traditional”, ones, have a substantial base of well-established SMEs. Many of these companies have grown up with Singapore. They are household names, and are important links in our business ecosystem.  As our economy restructures, traditional companies too will need to evolve to compete effectively and face new challenges.

 

5.     These SMEs are often family-owned, and face particular challenges with regard to succession planning and talent attraction. Nonetheless, SMEs in such “traditional” sectors can continue to grow if they are able to build a strong talent pipeline, innovate, and proactively pursue growth through innovation and opportunities to expand overseas.

 

6.     Mr Yeo Guat Kwang once shared a story about a man who tried to escape from a tiger by climbing a tree. However, he is not able to stay up the tree forever. This story tells us that we need to continue to be flexible and adapt to changes in order to survive. If I can add to the story, the man cannot hide on the tree forever. Instead, he needs to find new ways - to jump from one tree to another , or think of ways to subdue the tiger. This means he needs to innovate, adapt to changes and continue to move forward. Similarly, our SMEs need to relentlessly explore and find new ways to operate, be it through using new information or technology, and transform their traditional business into a forward-looking one.   There are many successful examples of companies in “traditional” sectors that have positioned themselves well for growth.  Old Chang Kee, for instance, has become one of Singapore’s successful household brands. It grew from a single hawker stall in 1956, to become a listed company.  It now has about 80 local outlets today as well as overseas market presence in Malaysia, Indonesia and Australia. The company has continuously transformed its businesses to keep up with the changing times.  With the support of SPRING, Old Chang Kee launched Curry Times Tingkat brand in 2013. This is a fully self-service concept restaurant where customers order and pay for their food via a kiosk. Customers then collect their food when their number tags are called.  This allows them to run a quick service restaurant with only 5 staff, much smaller compared to the usual 15 staff required.

 

7.     Everyone has a role to play in strengthening our SME sector.  The government is committed to helping companies in all sectors improve their productivity and competitiveness. Our broad-based schemes are available to all SMEs, whether in traditional or new sectors, and some can directly help SMEs in traditional sectors to address the challenges they face.  I will talk about some of these schemes later in my speech.

 

8.     At the same time, Trade Associations and Chambers (TACs) would also need to come forward to organise the industry and to raise the competitiveness of SMEs.

 

9.     Mr Thomas Chua asked about how the Government can support the development of Trade Associations and Chambers (TACs).  Given the size and range of the SME sector, government agencies, TACs and other partners need to work together to effectively reach out to SMEs.  For instance, through the Local Enterprise and Association Development (LEAD) programme, the government provides funding support to TACs for industry development projects and to upgrade their own capabilities.

 

10.     We recognize that larger TACs in Singapore have stronger secretariat teams, sizeable membership bases and are better able to roll out initiatives to benefit the industry.  On the other hand, there are many smaller TACs that are not able to provide similar services due to resource constraints.

 

11.     To help smaller TACs, JTC will be setting up a Trade Association Hub (TA Hub) to cluster different TACs under one roof. This will benefit TACs in 3 ways: Firstly, this can facilitate collaboration amongst TACs and companies across different industries, in areas such as skills upgrading and business co-creation. This is similar to Mr Thomas Chua’s example on the food manufacturing industry. They will benefit from this.

 

12.     Secondly, smaller TACs will be able to leverage on large TACs which can provide expertise in secretariat support and organisation needs.

 

13.     Thirdly, TACs can also reduce operating costs and optimise resources through the sharing of facilities and amenities. Ultimately, TAC members will benefit from the broader range of programmes which will be made available to them, and also from the improved convenience when TACs are housed together at the TA Hub.

 

14.     I am happy to announce that the TA Hub will be located at JTC’s iHUB, which most of us would recognise as the old Jurong Town Hall.  This is where Singapore’s early industrialisation policies took shape, in the face of the challenges we faced during our nation building years. We hope that this will serve as inspiration to our local industry, and especially our SMEs, to continue to transform and raise their productivity.

 

TRANSFORMING SMES THROUGH INNOVATION

15.     We will continue to grow the SME sector through 3 key strategies – innovation, collaboration, and internationalisation.  SMS Lee Yi Shyan had talked about internationalisation earlier, so I will elaborate on innovation and collaboration.

 

16.     In his Budget Speech, the Minister for Finance stressed that we must make innovation common and widespread in our economy. To encourage innovation among our SMEs, we have expanded broad-based schemes like the Innovation & Capability Voucher (ICV) and Productivity and Innovation Credit (PIC). These schemes are designed to help as many companies as possible.  Mr Thomas Chua would be happy to note that many SMEs from the traditional sectors have benefited from these Government schemes.

 

17.      Ms Foo Mee Har, Mr Gan Thiam Poh and Mr Zaqy Mohamad have asked about targeted Government schemes to promote SMEs’ transformation.  We recognise that each sector and even individual companies have different challenges. Hence, we have introduced targeted schemes to focus our efforts on priority sectors, or raise productivity in specific ways unique to the company or industry.  The Capability Development, Grant (CDG), which Minister Lim had talked about earlier, is one such programme. It is tailored to the capability development needs of individual SMEs. 

 

18.     Let me highlight how targeted innovation through the CDG has helped our companies raise productivity.  Food manufacturing company Foodedge Gourmet, for instance, tapped on the CDG to cover 70% of the qualifying costs to build a brand new ice cream production line.  Foodedge is a food supplier to cafes, restaurants and hotels, and ice cream is one of its key products.  Since 2014, with the introduction of this technological innovation, the company has been able to introduce new products such as salted caramel almond ice cream, pistachio ice cream and locally-inspired sorberts like Soursop and Lychee.  Furthermore, Foodedge was able to increase its ice cream production capacity by 5 times while requiring less manpower, who were redeployed to other areas. This enabled the company to supply more ice cream locally and explore export opportunities to the region. 

 

19.     As mentioned by Minister Lim, the CDG will be enhanced by simplifying the application process for projects below $30,000. For such projects, companies do not need to submit detailed project reports. We used to require them to submit detailed forecasts in terms of the project’s value add. Now, there will now just be five easy-to-answer guiding questions to describe the projects briefly as long as they can prove how they will improve their processes and productivity. In addition, the number of fields in the simplified application form will be further reduced. For example, companies need not provide detailed projections on the impact of the project. I heard Ms Foo Mee Har’s example of Little Ferry Agencies and how it has customised its racking system and processes to make itself more efficient. I used to be from that trade and can understand the type of racking system they had. We want to encourage companies to adopt such innovations. Under the enhanced CDG that was announced this year, this type of project could also be supported. 

 

 

SUPPORTING HUMAN RESOURCES OF SMES

 

 

NURTURING A VIBRANT ENTREPRENEURSHIP ECOSYSTEM AND  BOLSTERING SUPPORT FOR INNOVATIVE START-UPS

47.     Over the years, we have put in place a vibrant ecosystem. International publications such as The Economist and the Harvard Business Review have written about our start-up and entrepreneurship ecosystem.

 

 

 

57.     Dr Chia Shi-lu asked about how the Government will ensure that Singapore continues to be a pro-business environment.

 

58.     Our environment has always been a pro-business, we will continue to stay open and be receptive to feedback. One example is the Pro-Enterprise Panel (PEP).  The PEP is chaired by the Head of Civil Service, with the Second Permanent Secretary of MTI as Deputy Chairman.  They look at ways to streamline processes, through licence fees or a process review. 

 

59.     Since 2000, the PEP has accepted more than 1,000 suggestions to improve rules and regulations.

 

60.     Moving forward, in 2015, we will undertake more review of the costs arising from business regulatory compliance. As part of the review, we will engage companies and gather their feedback as part of their work throughout the year.