SINGAPORE: The Singapore economy is "in for a tough period that will last for a while", said Deputy Prime Minister Tharman Shanmugaratnam on Wednesday (Sep 28).
Speaking to reporters at the launch of the Wong Fong Industries headquarters in Joo Koon, Mr Tharman noted that for 2016, "we've had some growth at the start but the second half will be weaker; in the lower half of the 1 per cent to 2 per cent range".
Private sector economists surveyed by the Monetary Authority of Singapore have said they expect Singapore's economy to grow by 1.8 per cent this year.
"First, structurally, we are now in the new mode of growth. We can't keep growing by increasing manpower. We have to get productivity up. But even if things go well in Singapore, structurally we are talking about normal growth being 2 to 3 per cent – which is relatively good if we go by the standards of most developed economies," said Mr Tharman.
"We are currently growing below the normal growth and that's because of the cyclical winds that are affecting us. It's partly because of the general slowdown of the global economy, partly because of the restructuring in China, but it's also some sector-specific factors," he said, adding that Singapore has to prepare for growth "below 2 per cent for a couple of years".
GOVT'S PRIORITY TO HELP SMEs INNOVATE: THARMAN
"Now is the time for SMEs to retool during these tough times ... We also have to monitor our unemployment to ensure it doesn't become structural. We want to quickly match displaced workers with jobs, help people get back in as soon as possible. We will work with private placement providers, give incentives to match people to jobs," he said.
Mr Tharman said it remains the Government's priority to help innovation-minded SMEs: "We want to help SMEs to commercialise their capabilities beyond Singapore to take advantage of the growing regional opportunities."
Wong Fong Industries in particular, is looking to take electric vehicles right to the cutting edge with Singapore's first electric supercar that it is developing with Williams Advanced Engineering.
In recent years, the transport engineering firm has shifted gears to be more innovation-driven, moving into higher value areas such as military, specialised vehicles and electric vehicles.
"The first 50 years is about survival and profits, but going forward we feel innovation and research and development will be key," said Mr Eric Lew, executive director, Wong Fong Industries.
The firm's new S$30 million corporate headquarters is twice the size of its previous office and houses its new Wong Fong Research and Innovation Centre.
"With this new headquarters, we have expanded our service capability, we have expanded our Wong Fong Academy capacity and our research and development facilities. With that we are able to double the activities in the group," said Mr Lew.
At the launch event, Mr Tharman also called for closer partnerships between research institutes and local firms, which would help focus R&D resources towards commercialisation.