Singapore Has a 10-Year Plan to Ramp Up Manufacturing by 50%
(Bloomberg) -- Singapore aims to grow its manufacturing sector by 50% over the next 10 years to maintain its competitiveness, with the pandemic highlighting its importance to the trade-reliant city-state’s economy.
But the goal is ambitious as it will become harder to rely on foreign labor to supplement the local workforce, Trade and Industry Minister Chan Chun Sing said on Monday. To meet the aim, Singapore has to innovate and produce higher-value products rather than look to lower the cost of production or labor, he added.
The plan comes as the manufacturing industry emerged as one of Singapore’s bright spots as it underwent its worst recession on record. The pandemic has created a demand for products from sectors such as biomedical electronics and precision engineering sub-sectors, which in turn generated demand for supporting sectors such as logistics.
The city-state’s manufacturing sector contributes about 21%, or around S$106 billion ($80 billion), of total gross domestic product and accounts for about 450,000 workers, or around 12% of the workforce, according to the government figures.
“In the fight against Covid-19, securing essential supplies sometimes became a barter trade, and may continue to be so as we see global supply chains continue to be disrupted,” Chan told local media on the sidelines of a visit to a precision engineering firm.
“So whether people will sell us things or not” often depends on whether “we have things that other people value that they want to obtain, beyond just an issue of whether people are willing to pay the price for it,” Chan said.
Given that it will reduce reliance on cheap foreign labor, more locals will have to work in the sector, Chan said. Singapore also will try to attract the best global and local firms in niche areas that will ensure the city remains a critical node in global value chains, he added.
©2021 Bloomberg L.P.