AN innovation-led economy - one that is based on a society that is not risk-averse - will help Singapore navigate new challenges effectively.
In delivering his keynote speech at The Business Times Leaders' Forum 2016 on Tuesday morning to 300 business leaders, Minister for Industry S Iswaran spoke of the need for private- and public-sector stakeholders here to work together as Singapore looks to transition its economy.
Standard Chartered Bank is the presenting sponsor of the forum.
But as the economy restructures, there will be stumbles along the way, and businesses and workers must be prepared to accept these hiccups, noted Mr Iswaran. "Perhaps even more fundamental is the need to nurture a society that has a greater tolerance of risk and acceptance of failure, because - as all of us know - innovation and enterprise cannot always succeed."
Mr Iswaran is also co-chair of the Committee on the Future Economy (CFE) that was tasked to chart the way forward for Singapore's economy. It has met up with more than 2,000 stakeholders through close to 60 face-to-face sessions since January.
Mr Iswaran was recently made co-chair of the CFE after chairman Heng Swee Keat was hospitalised on May 12 after a stroke. Mr Heng, who is also finance minister, is now recovering well and lucid, said Prime Minister Lee Hsien Loong on Monday night.
Mr Iswaran has said that there will be no change to the timeline of the CFE's work. It is due to issue a report by year-end.
Innovation has frequently come up as a key factor for Singapore's future economic success in discussions the CFE has held. This is because Singapore's economy is at a crossroads, as it faces structural and cyclical challenges.
Domestically, Singapore faces demographic challenges, while externally, structural issues like rising labour costs in emerging economies and reconfiguration of global value chains have impacted the island's trade-reliant economy. Added to the mix are cyclical challenges as the global economic outlook remains uncertain. Growth is slower and more volatile all around the world.
These changes will result in industrial activity, business models and jobs being "reshaped, redefined or even completely displaced", said the minister.
"The change, whether evolutionary or revolutionary, causes uncertainty and compels difficult choices. Our best response to this uncertainty is to be prepared and adaptable in the face of these new economic realities," Mr Iswaran added.