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Growth of over 2.5% expected despite global risks: PM Lee

02 May, 2018

NOTWITHSTANDING global risks stemming from trade tensions, Singapore is likely to have "another good year" ahead, said Prime Minister Lee Hsien Loong yesterday.

Economic growth this year is expected to be 1.5 to 3.5 per cent "and if all goes well, we should do better than 2.5 per cent," he said at the labour movement's May Day Rally.

This comes after last year's better-than-expected growth of 3.6 per cent, with more new jobs, rising average wages and the highest productivity growth in seven years.

Yet, Mr Lee cautioned that Singapore's performance depends on the external environment.

Major economies such as the US, Europe and China "should be all right this year", but US-China trade tensions pose longer-term risks to the open, rules-based international trading system and global stability.v

On the world stage, as a small country, all Singapore can do is to speak up against such worrying trends; at home, Singapore can strengthen its economy, he said.

He reiterated the need for firms and workers to transform and adapt in a time of technological disruption, citing examples in three areas.

First, in transport, the taxi industry has been adapting to ride-hailing apps such as Grab.

Self-driving public transport may be the next step, said Mr Lee, citing current work by China transport player Didi Chuxing. But he reassured bus captains that driverless buses will not hit the roads any time soon - and their eventual advent will help bus captains, not do away with the need for manpower altogether.

Second, banking has seen waves of change, from ATMs in the 1980s to internet and mobile banking, with fintech as the latest wave.

As mobile banking expands, banks will need to reskill and redeploy frontline staff such as bank tellers. Mr Lee noted that this is underway with Professional Conversation Programmes developed by the Monetary Authority of Singapore, Workforce Singapore, the unions and the banks.

Third, e-commerce is changing retail and logistics. Brick-and-mortar stores have to compete with online retailers. Logistics firms are innovating in delivery and warehousing - for instance, using drones for stock-taking.

The rise of e-commerce also requires collaboration across the two sectors: retailers partner logistics providers to deliver products, and logistics providers have to integrate their systems with those of retailers.

Technological change must be embraced by firms and workers alike, concluded Mr Lee, adding that the 23 Industry Transformation Maps provide guidance to workers on what skills are needed in each area, with a range of programmes available.

The prime minister also highlighted the labour movement's upcoming leadership change. Chan Chun Sing, National Trades Union Congress (NTUC) secretary-general since 2015, is now Minister for Trade and Industry. Former Minister for Education (Schools) and Second Minister for Transport Ng Chee Meng will take over as labour chief.

In MTI, Mr Chan's experience in the labour movement will prove valuable, said Mr Lee. "He has now got first-hand experience of the labour movement, of workers' concerns, of dealing with the tripartite partners."

His move also means that the labour movement will now have "a special friend in MTI", just as it has in the Manpower Ministry with former labour chief and outgoing Manpower Minister Lim Swee Say and current Manpower Minister Josephine Teo.

Meanwhile, Mr Ng himself "is no stranger to the labour movement", having worked closely with the teacher and public transport unions in his previous portfolios.

"I am confident that he will build on Chun Sing's good work and lead NTUC well, (and) together with Poh Koon, with Brother Chee How, with Sister Mary, take the labour movement to greater heights," said Mr Lee, referring to NTUC deputy secetaries-general Koh Poh Koon - Senior Minister of State for Trade and Industry - and Heng Chee How, who is Senior Minister of State for Defence, as well as NTUC president Mary Liew.

These changes are part of Singapore's leadership transition, he said, with the fourth generation political leadership learning on the job, taking on more responsibilities, and preparing for succession.

With a new generation of union leaders also being groomed, Mr Lee called on the "younger leaders" of both sides to "renew the trust between the government and the NTUC, and renew their commitment to the tripartite relationship."

Adapted from The Business Times, May 2nd 2018.