Jamus Lim: Singapore must now foster an environment where SMEs are better positioned to succeed
SINGAPORE: In a Sept 1 (Tuesday) social media post, Workers’ Party Member of Parliament Jamus Lim (Sengkang) made the case for strengthening Singapore’s small and medium-sized enterprises (SMEs), which he believes is vital to the future of the city-state’s economy.
The MP, who is an Associate Professor of Economics at ESSEC Business School, spoke on the party’s perspectives on economic policy in Parliament on Aug 5. He and fellow WP MP Kenneth Tiong (Aljunied) had tabled a motion calling for an economy of the future that would benefit all Singaporeans.
However, Assoc Prof Lim and Mr Tiong’s policy proposals later came under fire and were debated online, though both MPs countered the arguments that had been posted.
On Tuesday, Assoc Prof Lim opened his post this way: “Have you ever been in a bad relationship for so long, that you can’t possibly imagine what it’d be like if you weren’t together? There was justifiable reason that you guys got together, but it’s now time to move on.”
He used the challenge of moving on from a bad relationship as an allusion to Singapore’s dependence on multinational corporations (MNCs) and Government-Linked Companies (GLCs) in the past, adding that while they’re still important to the economy, Singapore “must now foster an environment where SMEs are better positioned to succeed. This is crucial if we want to see the next generation of homegrown SMEs become the MNCs of tomorrow.”
While there are many programs that support start-up firms, these are usually only available at the beginning, while in Singapore’s business environment, land and labour costs are among the highest in the world. The difference in salaries offered between SMEs and MNCs also makes retaining talent difficult, and these factors mean an uphill climb for SMEs to succeed in the local market, let alone globally.
Assoc Prof Lim then went on to explain what can be done to support Singapore’s SMEs, including expanding tax credits for R&D activities, offering grants that would balance the wage gap, and easing requirements for internship programs such as GRIT.
As for high business costs, rental rates could be better managed, he argued, in a similar way as this is done in other developed economies. Additionally, the quotas for foreign hiring can be loosened for sectors that most Singaporeans do not wish to pursue.
The MP posted a link to the draft of his speech, where his proposals may be viewed in full. A summary may be found here.
Assoc Prof Lim explained again that the WP is not rejecting MNCs, writing, “Indeed, the lack of imagination by the PAP in taking on our arguments without resorting to misrepresentation makes me wonder if they have any other strategy in their tired economic playbook.”
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Returning to the allusion of leaving a longtime relationship, the MP wrote that two people who grow apart don’t necessarily cut ties completely.
“But it does mean recognising that one can be independent, grow wings, and find one’s unique identity and selling point. It means devoting a disproportionate amount of attention to nourishing the part that has fallen between the gaps. For the #workersparty, that means weaning ourselves off an economy wholly reliant on giant corporations, and evolving to one where small and medium companies can flourish and thrive,” he added. /TISG