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Shift to value-creating economy is the way to go: Swee Keat
THE shift to a value-creating economy is important for Singapore, as it will create good jobs and ensure the country remains as the base to grow innovative and entrepreneurial companies, said Finance Minister Heng Swee Keat on Wednesday.
Speaking at the Semi-Centennial Leadership Conference organised by the Singapore Business Federation (SBF), he emphasised that a value-creating economy focuses more on new opportunities, as well as on innovation and being different.
"If we are simply producing what the rest of the world is producing, we won't be able to command a premium or sustain our competitive edge," he told an audience of some 500 C-suite executives.
"We have to produce what the rest of the world is not producing, or at least, not much of. To do so, we have to build deep capabilities and linkages in our companies, our industries and our economy, to create new products and deliver better solutions in cost-effective and innovative ways."
Mr Heng, who also chairs the new Future Economy committee, also made the point that the foundation of a value-creating economy had to be a network of innovative and entrepreneurial companies that could continually create value that exceeds the cost of its inputs.
He added that innovative companies are led by "outstanding leaders who make the right strategic choices, execute rigorously and create opportunities" for their employees to be at their best.
In his 20-minute address, the minister reiterated the five areas that will be critical to Singapore's future economy - companies, jobs, markets, technology and resources. Some corporate leaders have already tackled these areas well and have led their respective companies to stay ahead, he said.
Saying there is "no golden formula" for creating value and staying successful, he shared lessons from success stories that he had come across, citing Boustead Singapore, a distributor of well-known brands such as Procter & Gamble, Cadbury and Johnnie Walker in the 1960s.
When many of these companies chose to set up their own offices in Singapore, Boustead took stock of its business model and moved into infrastructure-related engineering services, which paved the way for its many successes today.
The minister also hailed a programme that the UOB Group launched some years ago with the Singapore Management University to develop private bankers; the training covered a range of skills for financial advisory work.
Mr Heng also urged companies to seize opportunities to connect to regional and global markets as this would transcend the size of Singapore's domestic market and build scale.
"Singapore is already an externally-oriented economy, but we need to delve further into strategies to help our companies expand into these markets amid rising competition," he said. "Internationalisation is complex. This is why good business leadership is key, to help organise ourselves to better connect to regional and global markets."
The day-long conference at the Suntec Singapore Convention and Exhibition Centre featured three panel discussions, involving business leaders such as NTUC FairPrice chief Seah Kian Peng, Singapore Press Holdings chief executive Alan Chan, and Osim chairman and chief executive Ron Sim.