Singapore attracted S$11.8 billion of investments in 2021; more than 17,000 new jobs expected in next 5 years

SINGAPORE: Singapore attracted S$11.8 billion in fixed asset investments in 2021, commitments that are expected to create more than 17,000 jobs over the next five years, said the Economic Development Board (EDB) on Wednesday (Jan 26).

The figure was a sharp fall from the S$17.2 billion committed in 2020, which EDB described as an "exceptional performance" that it did not expect to repeat in 2021.

Last year's figures were in line with EDB's goals of having S$8 to S$10 billion in investments committed annually over the medium to long term.

Fixed asset investments refer to a company’s incremental capital investment in facilities, equipment and machinery.

In its annual year-in-review report released on Wednesday, EDB said a successful vaccination rollout and the reopening of travel in the second half of last year gave companies the confidence to invest and expand here.

"The strong 2021 investment commitment numbers are testament to Singapore’s reputation as a strategic hub and critical supply chain node for companies to do business in Asia and for the world," said EDB Chairman Beh Swan Gin.

“As economies reopen and connectivity is restored, our reputation for reliability and neutrality, our vibrant innovation and tech ecosystem as well as our growing talent base will stand us in good stead to capture more economic opportunities for Singapore,” said Dr Beh.

STRONG INVESTMENTS BY ELECTRONICS, BIOMED MANUFACTURING FIRMS

Electronics and biomedical manufacturing were the top two sources of investments last year, with nearly S$5 billion and S$1.8 billion secured respectively.

They accounted for more than half of the investments committed last year.

There were also new investments across sectors such as agri-food, chemicals and materials, and electronics.

By region, as in 2020, the bulk of investments commitments in 2021 came from the United States (67.1 per cent) and Europe (13.1 per cent). 

Total business expenditure per annum, which refers to companies’ incremental operating expenditure including wages and rental, was S$5.2 billion last year, falling from $6.8 billion in 2020.

EDB's medium to long term target is S$5 billion to S$7 billion per year.

When the new projects that were committed in 2021 are fully implemented, EDB expects 17,376 new jobs to be created in the next five years, contributing S$16.8 billion in value-added per year.

Around 35 per cent of these jobs will be in production, which include roles in the manufacturing, engineering, supply chain and logistics industries.

This is followed by business and commercial services roles which will account for another 32 per cent.

Speaking at a press conference, EDB managing director Jacqueline Poh said 70 per cent of these new jobs will be professional, managerial, executive, and technical (PMET) roles.

She added that the majority of these jobs are expected to be for locals.

“The jobs that we've created are definitely, on one hand, very much high value, but on the other hand, also bring with them a range of other roles that are very accessible to the man on the street,” she said.

DIGITAL ECONOMY

EDB said the growth of the digital economy contributed significantly to total business expenditure commitments in 2021, as digitalisation picked up pace across all sectors.

Over the past decade, the digital sector has almost doubled its share of total jobs created through EDB-related investments, it added.

Besides this, EDB said companies also capitalised on Singapore’s thriving research and innovation ecosystem to undertake more research and development, and innovation activities.

This included the establishment of new R&D centres, innovation platforms and partnerships with Institutes of Higher Learning and public research institutions.

"These activities not only served to enhance their existing products, but helped spawn entirely new products and businesses, strengthening Singapore’s innovation capabilities and creating new job opportunities for Singaporeans," said EDB.

In May last year, EDB launched a S$10 million pilot programme to help large companies venture into new growth areas beyond their existing core businesses. 

UNCERTAINTY OVER INFLATION 

Responding to a question from the media about the impact of inflation on investments, Dr Beh said a lot will depend on how aggressively central banks are able to act to dampen the effects of inflation.

However, he noted that the uncertainty could potentially have an impact on the appetite for investments and demand.

On Monday, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) said that "significant uncertainty" surrounds the outlook for inflation in the near term, including from the costs of air travel and commodity prices such as food and oil. 

They added that global inflation remains elevated and is likely to persist “for some time” before easing gradually towards the end of the year.

SINGAPORE MUST REMAIN OPEN AND CONNECTED: EDB

While the global economic and investment climate remains uncertain in 2022, EDB said it will continue to focus on high-growth and high value-added sectors to offer Singaporeans "exciting" job opportunities and entrepreneurial career pathways.

With Asia expected to contribute to around 60 per cent of global growth by 2030, EDB said it expects Singapore to remain attractive to global companies seeking to invest in Asia as well as Asian companies looking to expand globally.

“Digitalisation and the digital industry will remain a vibrant source of new concepts and business models,” said EDB. “The need to find healthcare solutions for an ageing population and resilience for infectious diseases will also propel investments in biotech and medtech.”

It added that the push for sustainable solutions to combat climate change will also give rise to new business opportunities in decarbonising existing industries, and growing new types of enterprises for the green economy such as in carbon services.

To emerge stronger and seize these opportunities, EDB said Singapore must stay open and connected to the world, and especially Southeast Asia.

It said that the country must also step up efforts to develop an “entrepreneurial and innovation-led” economy, and ensure that its workforce has competitive and relevant skillsets.