How SMEs can fight uncertain economic conditions

BEING an open economy depending heavily on trade, Singapore is now facing considerable challenges ahead. With the continued slowdown in the major markets, Singapore experienced decreased demand for its goods and services. Its economic growth is forecast to remain around 1-3 per cent this year. The situation is further aggravated by weak results in major industries including the manufacturing, banking and shipping sectors.

On the domestic front, high operating costs made Singapore less competitive in the global market. Against this backdrop, businesses - including small and medium-sized enterprises (SMEs) - are hesitant to make bold decisions that are necessary for the future. Many SMEs have also voiced the need for measures to help restructure and to ensure survival and continued growth in such uncertain times.

SMEs form a significant part of Singapore's economy - they contribute to more than half of gross domestic product (GDP) while employing 70 per cent of the workforce. Given their importance and acknowledging the difficulties faced by SMEs, Finance Minister Heng Swee Keat has clearly heard their cries for help and announced various measures in Budget 2016 to help SMEs ride through the economic uncertainties.