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New opportunities abound: Tharman (Amended)

Don't buy the pessimism, get set for change instead, he says

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Pessimism must therefore be set aside and effort put into getting domestic politics right; people need to be prepared for future changes so no one is left behind by the forces shaping the global economy, he said.


Pessimism must therefore be set aside and effort put into getting domestic politics right; people need to be prepared for future changes so no one is left behind by the forces shaping the global economy, he said.

Speaking to about 400 guests from 36 countries at a dinner marking the opening of the Singapore Summit, he noted that the global economy now seems to be "in a funk", but that there are grounds for optimism, as there are still ways to ensure that people do not "lose out to trade and technology".

The two-day summit is organised by inter-agency initiative Global-Asia Programme Office, and co-led by the Singapore Economic Development Board and the Monetary Authority of Singapore. Global markets around the world have been recently roiled by China's slowdown, a fall in commodity prices and the shock decision of the United Kingdom to exit from the European Union.

Added to this mix are political and security woes, such as those arising from terrorism and anti-immigration movements.

Mr Tharman advised against letting pessimism over this state of affairs coming out from advanced economies paralyse domestic politics. This is because there are still reasons to be hopeful, as evidenced by the experiences of economies and societies in Asia.

For instance, growth of global trade still exceeds economic growth. The World Trade Organization expects growth in world merchandise trade volume for this year to be at 2.8 per cent; the World Bank forecasts this year's global economic growth to come in at 2.4 per cent.

Therefore, there is no need for economies to disengage from global trade. "Globalisation is still an overwhelmingly positive thing," said Mr Tharman.

Governments and societies should instead turn their pessimism into a catalyst for unity, so that better policies can be drafted to resolve these problems.

"It is not difficult for politics - whether on the left or right - to talk about ethnic issues, to talk about immigration, to talk about China, to talk about threats outside, but (discussions should) be more focused on the central issues of domestic-policy responses for the real world," he said.

With technology now making its disruptive effects felt across multiple sectors, there is now an even greater urgency to take the right approaches to overcome the prevalent pessimism.

For example, ride-sharing platform Uber is upending the taxi sector, leading to anger from drivers from around the world.

But at the same time, new possibilities have opened up, and it would be important for all to "remain as resilient as possible when the unthinkable happens", he said.

For workers, attaining new skills and upgrading one's skill sets would be crucial. Noting that the over-emphasis on graduate degrees has been at the expense of attention on attaining the right job skills, Mr Tharman called for students to be put on "paths of advancement" for skills in dealing with real-world situations.

"The whole mantra of college education - of trying to make it as easy as possible for everyone to get a college education - is a big mistake," he said.

On a larger scale, economies, especially younger ones, should get plugged into global value chains as soon as possible.

This is because if they don't "get into the game" in the next five to 10 years, opportunities to move these workers from labour-intensive jobs to more skills-focused ones will be lost, said Mr Tharman, who is also Coordinating Minister for Economic and Social Policies.

In this sense, Asean remains a bright spot in the region, as its focus on trade and investment to foster regional integration takes it away from being hijacked by political concerns, as has happened in the European Union.

He said Asean should now focus on trade in services, and a deeper integration with India to generate more growth.

But even as economies are struggling with disruptive forces, Singapore has to embrace them as its labour supply is tight, he said.

Thus, the government not only cooperates with employers and trade agencies to help those displaced to find new jobs, it also works hard at nurturing the sense that one can be "optimistic even in the world of technological change".

"Don't let the perceptions or the narrative have their own dynamic - they're overplayed and over-stated. The future depends on us and what we do," he said.

Amendment note: An earlier version of this story had quoted Mr Tharman as saying that the "perceptions or narratives" are "over blatant". He had in fact said that they are "overplayed". The story has been amended to reflect that.