Around $4.6 billion will be invested to boost businesses and support Singaporean workers over the next three years.
Of this, $3.6 billion will be earmarked to assist workers during industrial disruptions, while $1 billion will enable firms to grow their deep enterprise capabilities.
"But let me emphasise that supporting companies and supporting workers are mutually reinforcing," Finance Minister Heng Swee Keat said yesterday. "Stronger companies provide better jobs and pay for workers, and highly skilled workers make companies stronger."
Start-ups and small and medium-sized enterprises will also get help:
• A Scale-up SG programme by trade promotion agency Enterprise Singapore (ESG) that aims to help high-growth local firms innovate, grow and venture overseas.
• A two-year pilot where firms can get advice on innovation opportunities and ways to commercialise technology from "Innovation Agents" - industry veterans with expertise in technology and business.
• An additional $100 million for a new SME Co-Investment Fund III to help companies draw in "smart, patient capital that attracts investors with the expertise and the right time horizon". The fund is expected to bring in another $200 million for SMEs during fund-raising.
• An Enterprise Financing Scheme, to be launched in October, that will combine ESG's eight financing programmes covering trade, working capital, fixed assets, venture debt, mergers and acquisitions, and project financing.
• The Government will take on up to 70 per cent of the risk for bank loans, up from 50 per cent in most existing schemes, made by firms that have been incorporated for less than five years.
• The extension of the existing SME Working Capital Loan scheme until March 2021.
• Trade associations and chambers will develop five-year plans to map out how they can help their industries transform. The Government is also working with partners on the secure exchange of electronic trade documents to lift productivity.
Our ultimate goal is to enable our people to continue to have good jobs and opportunities, and to be at their best. Hence, the second thrust of our economic transformation is to deepen the capabilities of our workers.
FINANCE MINISTER HENG SWEE KEAT
Government assistance will also be available in a tiered manner to help firms build deep enterprise capabilities, said Mr Heng. Large firms will get customised support from the Economic Development Board, ESG and other agencies, while SMEs will be supported through "scalable solutions".
These measures come amid an expected moderation of global economic growth this year. Singapore's economy grew by 3.2 per cent in 2018 compared with 3.9 per cent in 2017. "Our efforts to transform our economy are bearing fruit," said Mr Heng, who cited the 23 Industry Transformation Roadmaps that were launched in the 2016 Budget. Productivity has grown by 3.6 per cent a year since 2016, up from 1.6 per cent a year recorded in the preceding three years, he noted.
Part of the productivity boosts arise from the Government's support of SMEs, many of which would otherwise be hard-pressed for resources to beat industrial disruption, said business owners.
"Young companies face a constant challenge of being resource-or capital-constrained, which potentially limits growth and the speed to scale," said e-commerce platform Shopmatic's CEO Anurag Avula, adding that the measures to support SMEs are "very encouraging".
Food manufacturer Golden Bridge had tapped the Lean Enterprise Development Scheme and partnered local institutes to help automate production and raise efficiency.
These have enabled it to be competitive against other manufacturers in Europe, where it is now seeking to expand, said operations director Ong Chew Yong.
While the manufacturing industry has performed strongly, Mr Heng said the construction and some service sectors continue to show weaker productivity growth.
"There is much more we can do, especially in sectors like domestic services. We must press on."