1. Leading the way - November 9, 2009 http://www.businesstimes.com.sg/sub/premiumstory/0,4574,358356,00.html?
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'Remember me' Do you agree that services will play a key role in driving Click on the thumbnail
economic growth in 2010? What are the implications for above for a full size view
businesses and the overall Singapore economy?
ST Index (Real-time)
2,707.60 14.22 Andrea Ross Email this article
Managing Director
Tue, Nov 10, 2009, Robert Walters Singapore Print article
18 58 Feedback
KLCI 1,274.08 +6.33 WHETHER it is
HSI 22,268.16 +60.61 services or not,
NIKKEI 9,870.73 +61.74 Singapore's
economic growth will be dependent on the
Dow 10,226.94 +203.52 external environment. Larger unresolved
Nasdaq 2,154.06 +41.62 structural issues faced by our major trade
S&P 1,093.08 +23.78 partners, price competition and the
Monday Closing
strength of the Singapore dollar all point to
challenging times ahead for the traditional
Singapore: Shares higher at manufacturing, engineering and logistics
close
US: Dow hits 2009 high
industries.
However, we do see a surge in job
Breaking News opportunities recently within the services
Print Edition Headlines industry, particularly in the financial
services and insurance, information
technology and healthcare/pharmaceutical
Hock Lock Siew sectors. We would expect this to continue
Editorial & Opinion into 2010 due to the high recruitment
activity in these sectors in the fourth
quarter.
Stocks
Stock Picks Other service-related sectors where we anticipate growth include
IPO Watch education and tourism (led by the Integrated Resorts and the staging of
global sporting events), with a focus on tailoring these offerings to the
FX/Money Markets
emerging wealth economies.
Funds/Unit Trusts
Derivatives Within financial services, there continues to be a deployment of roles into
Singapore as many firms view the location as a cost effective hub to base
Commodities
their Asian operations. However, it will not be the only industry to drive
Calendar economic growth in 2010. We foresee that the pharmaceutical, biotech,
Tools telecoms and FMCG companies will continue to hire aggressively next year
as these industries tend to be relatively more recession proof.
Biz IT The semiconductor and automobile sectors continue to remain flat and will
Property take some time to fully recover. The implications for companies in these
Executive Money sectors will include: staff morale issues, employees continuing to feel
stretched and organisations struggling to retain top talent as their people
Executive Lifestyle will look to move to more buoyant markets.
BT Living
Another key consideration is the correlation of local employment growth to
APEC Singapore 2009 economic growth. As we move into the more value-add streams and away
Enterprise 50 from the traditional manpower-reliant areas, net job loss can possibly
More
offset job creation in the shorter term and structural unemployment may
occur.
Mon Tue Wed Thu Fri Sat Sun Julien Arnaud
CEO
Edgilis
AS manufacturing demand continues to waver and shift to developing
markets, the professional service sector will play an increasingly
significant role in driving economic growth both in Singapore and
overseas.
To shine a brighter spotlight on the service sector and track industry
performance, Singapore regulators should consider adapting a tactic from
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2. Leading the way - November 9, 2009 http://www.businesstimes.com.sg/sub/premiumstory/0,4574,358356,00.html?
the UK which successfully increased the level of investments in the sector.
In early 2009, the first Professional Services Index was launched on the
London Stock Exchange, which traces the performance of UK-listed
professional firms. The index is up 23 per cent since March. A similar index
here would sharply identify the service sector as an economic priority,
giving a boost to Singapore-based companies.
Vinod Kumar
President & Chief Operating Officer
Tata Communications
SERVICES will continue to gain their share of the pie in Singapore. What I
expect is that we will see a steady shift towards higher value added
services that are more knowledge based. While sectors like tourism will
grow and contribute to the economy, the uniqueness of Singapore will be
derived from the robust presence of professional services, medical
services and innovation centres for next generation industries like biotech
and digital media.
Tata Communications realises this and hence we operate several critical
functions of our global business from Singapore. However, Singapore
needs to ensure that its economic framework is constantly evolving since
there are other cities in Asia and the Middle East trying to replicate its
model.
Ray Ferguson
Regional CEO, Singapore and South-east Asia
Standard Chartered Bank
THE composition of Singapore's Gross Domestic Product (GDP) is set to
shift more towards services and away from manufacturing - we think that
manufacturing may shrink to 20 per cent of GDP by 2013 from around 25
per cent in 2008.
We envisage the Singapore economy will transform into a structure similar
to developed countries like the United States (US) which has more than 80
per cent of its economy comprising of services. Nonetheless, unlike the
US, Singapore's service sector would still be reliant on external demand
due to the absence of a significant domestic consumption base.
As a financial services institution, Standard Chartered has continued to
make good progress in 2009, building on the record income and profits in
the first half of the year. We continue to benefit from the growth
opportunities across our broad and diverse franchise and our continued,
deliberate focus on capital and liquidity strength remains a source of
competitive advantage.
Annie Koh
Dean, Executive and Professional Education
Singapore Management University
THE prognosis from the MAS and other government agencies represents a
realistic picture of Singapore's value drivers, going forward. Pending the
report coming from the ESC(Economic Strategies Committee) - the writing
has been on the wall before the crisis and is even clearer after the
excesses have been corrected.
Currently, based on the ADB March 2009 figures, over 75 per cent of our
GDP is derived from the services sector and this will likely move up to
over 80 per cent in another year or two. For Hong Kong, the services
sector accounts for 92 per cent of their GDP!
This is not unusual for 'global' cities like New York City or London given the
land constraints for traditional production and the need to move up the
value chain for higher value added manufacturing.
So while Singapore will attract more pharma and bio tech, design and
media firms - there will be business-to-business services set up to ensure
that such high-end manufacturing is viable in our ecosystem. We will need
professional services support - legal, accounting, finance and shipping
services - which is targeted to meet the needs of these high value-add
industries. So the service sector needs to understand the specialised
industries they support.
I also see the need for Singapore to strengthen the quality of our human
capital and professional managers to run global companies (hence the
set-up of the Human Capital Leadership institute). We also need a good
understanding that service excellence means lining up the back end and
middle office support to ensure that higher consumer expectations are
met.
We will have more sophisticated consumers coming into the country to
visit, work, learn and play - so the greater dependence on the services
sector will mean a much higher level of talent and human capital . . .
those are also the barriers which will take longer to build and greater
difficulty to emulate.
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There will always be cheaper production workers - but it is more difficult to
get knowledgeable and educated service workers. All private, public and
academic resources will have to be aligned to make sure the service
sector creates value and adds value, as that will be our lifeline, going
forward. Singapore has no choice but to make this work.
Liu Chunlin
CEO
K&C Protective Technologies Pte Ltd
AS the developed economies overhaul their manufacturing industries
ravaged by the financial crisis, it will take some time before MNCs readily
put in more investments in countries like Singapore.
Even if they do, the BRIC (Brazil, Russia, India and China) countries will
pose a challenge in terms of manpower cost competitiveness. And with
carbon trading becoming a fixed agenda, Singapore will find it increasingly
hard to push in that direction.
We are hence squeezed between the rock of MNCs not investing in new
manufacturing yet and the hard place of the BRIC's cost-competitiveness.
What then holds opportunities for us is in the soft areas, with what we can
do with our human capital. These areas I see as innovation, aggregation
and integration.
Innovation will help us create new services and new technological and
other products to meet new demand. We are also well-positioned with our
educated population at home in both Asian and western culture.
Our investments in the bio-medical sector should hopefully bring a
harvest. In terms of aggregation and integration, I see potential in our
ability to pull and put things together, whether in project management, IT,
gaming software, multi-media productions, financial services, tourism,
MICE industry and even culinary experiences (for the last two I think of
the impending opening of the IRs and the opportunities they bring).
John Koh
Managing Director
WMRC Private Ltd
THE migration to the services industry is inevitable as Singapore
progresses towards higher income levels. This is the same phenomenon
happening in other developed countries where the GDP contribution of the
services industry increases at a much faster rate compared to traditional
industries such as manufacturing and trade.
In the case of Singapore, what is unique is that we have managed to
retain our traditional strength in manufacturing while building a strong
reputation and critical mass for the services industry, in particular the
financial services.
There are definitely deep implications on businesses and our society as our
economy becomes increasingly dependent on services to drive growth.
Services typically employ people who are well educated and able to work
fast and work smart. The growth of services will bring with it ancillary
services needed to augment the value chain. New business opportunities
will arise to support and complement the services industry, which
Singapore would have the potential to develop into a services hub
providing key value to businesses across this region.
Wee Piew
CEO
HG Metal Manufacturing Ltd
WITH the opening of the two IRs and the Universal Studios theme park
next year, the service industry is definitely going to play a key role in
Singapore's economic growth in 2010 and beyond.
Besides tourism, we should also see strong growth in other service
industries like the medical and education sectors as the regional
economies recover. This trend is inevitable as the Singapore economy
matures and it can no longer depend on the manufacturing industry to fuel
its growth. It also makes strategic sense for Singapore to focus on growing
the service sector as it will help provide another leg for the economy.
This is important as the manufacturing industry has not fully recovered
while its sub-sectors like the pharmaceutical industry is volatile in nature
while the tech sector is extremely dependent on the US economy.
As Singapore moves towards a more service dependent economy,
businesses will have to constantly monitor service standards in order to
ensure that service standards can be constantly maintained at a high level
and at the same time, look at ways to improve them. As a result, a larger
part of their annual budgets may need to be allocated to educate and help
improve service standards.
François Lançon
President
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Nortel Asia-Pacific
IN the technology industry, we have started to see growth in Singapore
and elsewhere in the region, with forward-looking companies making
technology investment decisions that will help them provide better service
as the rebound kicks in.
Government spending has remained strong through the downturn, but the
service sector is now showing some growth - with renewed financial
services spending on technologies that aid efficiency, reduce cost and link
communications to business processes, providing greater efficiencies and
in turn helping companies develop more robust and easy-to-manage
customer offerings.
Healthcare and education remain strong, and even in the hospitality
arena, we are starting to see a pick-up in demand, fuelled by the desire to
differentiate service and improve staff effectiveness. This trend looks set
to continue with the opening of new resorts, and the continued
improvement of regional economic prospects.
Clement Goh
Managing Director
Equinix Singapore
WITHIN the IT market, IT services will definitely be the driver for growth
as increasingly, we are seeing margins coming from IT services rather
than hardware or software.
The Singapore government has been moving in the right direction,
encouraging development in services-centric sectors like new media and
digital services. Singapore is in a good position to offer IT services, as we
have the talent pool with the right knowledge and skill sets, guided by
proven methodologies and processes.
What is important now is to ensure that there is more emphasis on soft
skills like customer service and consulting when it comes to training. This
is already happening at our local tertiary institutions, so I believe we are
well-equipped to meet the demands of a services-driven economy.
Teng Yeow Heng Michael
Managing Director
Corporate Turnaround Centre Pte Ltd
I AGREE that services will play a key role in the economy in 2010 and
even beyond. I have personally spent more than 20 years in the
manufacturing industry and have seen Singapore losing its competitive
advantage in this sector across the board in recent years with the rapid
rise of China.
Unfortunately, we still have a penchant to promote manufacturing rather
than services. Unlike the promotion of the manufacturing industry where
we need to attract foreign technology and multi-national companies, for
the services sector we need to focus on developing our own people as a
brand. We will not have a strong servicing industry especially in financial,
medical, education, consultancy, training, entertainment, professional
services and so on, if we continue to develop foreign talent who ultimately
go back home to their countries of origin.
Thus, we need to first recognise our own local talent and brands and
award them service jobs, contracts and government tenders so that they
have an opportunity to excel and flourish. If we ourselves do not value our
own brands, it is going to be difficult to convince outsiders of our
capabilities and therefore develop a thriving service industry, going
forward.
Tim Hird
Managing Director
Robert Half Singapore
SINGAPORE'S finance sector is expected to play an important role in
driving economic growth as the city-state seeks to reinforce its position as
a regional financial hub in the wake of the recent crisis. Demand for
high-quality financial services and finance professionals, particularly for
business critical roles such as risk and control, is expected to rise sharply.
As business confidence returns, it is important that organisations not only
drive growth in their businesses, but also answer to the call for greater
accountability and transparency by strengthening their corporate
governance practices. This will augur well for the long-term sustainability
of the island's economic recovery and future growth.
Stephen Lockley
Managing Director
Sodexo Singapore
GIVEN the resource constraints in Singapore, it is imperative that
Singapore continually moves towards being an established service-
oriented economy. Therefore, it is natural that the service industry has
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been earmarked to lead economic growth indicators as we move into the
new year.
At Sodexo, our value-added outsourcing service provides companies with
an attractive option to streamline their non-core business operations and
costs. This allows us to fare well even in the downturn, and we are
well-placed to continue contributing to Singapore's economic growth into
2010 and beyond.
Growth in the service sector will provide a much needed uplift to the
overall economy, which will have a spill-over effect in improving the
sentiment and demand in other industries like manufacturing.
So while the immediate outlook remains less than optimistic in certain
economic quarters, we believe that sustained traction in the areas that
recover faster during the upswing lends itself to improving economic
fundamentals. This will be a key factor in ensuring a holistic and steady
growth for the Singapore economy.
Andrew Tay
President
Zebra Technologies of Asia-Pacific
IN a small country with limited resources but big ambitions like ours, the
progression towards a more services oriented economy is natural.
However, the fight to stay relevant is just as competitive.
For example, in the global healthcare sector, the struggle for healthcare
dollars is increasingly fierce with more and more players entering the
field. The development of new hospitals and training of healthcare
professionals is a 'hygiene factor' for this industry; our real differentiator
will be in the use of technology to enhance a patient's medical experience.
RFID and barcode labelling, for example, can be used by healthcare
professionals to provide better patient care and identification.
I also think it's important to note that manufacturing continues to be one
of the cornerstones of the Singaporean economy, and that continued
investment is necessary to keep this industry competitive in an
increasingly 'flat' world.
Recent signs of economic recovery have manufacturers grappling with
inventory management as government programmes stimulate consumer
demand yet general economic weakness is seen. When speaking to
customers in this sector, we advise the consideration of technologies that
help manage and track assets and which increase visibility into the supply
chain to monitor production, factory management, and supplier networks
to help keep customers competitive.
All the things which made Singapore great - efficiency, transparency and a
great well trained workforce are assets that will continue to serve us well
in an increasingly services oriented global economy.
Teresa Lim
Managing Director
IBM Singapore
GLOBALISATION is changing the world of work and how we operate in a
globally integrated enterprise of the 21st Century. Many decades ago,
global economic growth was heavily dependent on the manufacturing
sector and modestly dependent on services. But the world is becoming a
giant service system, comprising six billion people, millions of businesses,
and millions of technology products connected into service networks.
In Singapore, the services industry accounts for more than half of our
gross domestic product and this figure continues to grow. The Monetary
Authority of Singapore also expects services to fuel growth in 2010. In
order to position ourselves for the further growth, it is imperative that our
workforce is enabled with the appropriate skills and able to reinvent itself
to remain viable and stay ahead of competition.
In our view, to win and lead in this new global marketplace, the 21st
Century worker will need to bring to the table a strong mix of business,
technical, and people skills.
At IBM, as we look at this landscape, we envision the ideal individual to be
a 'T-shaped' persona - someone who has a deep proficiency in one area,
engineering for instance, but are also conversant and comfortable
interacting in a profitable way with other departments, such as marketing,
industrial design, and finance, for example. To this end, we are working
with universities around the world to help create this emerging discipline
that we call services science.
Working with academia, we aim to equip students with an integrated mix
of business, technology and people skills.
We term this new academic field Service Science, Management and
Engineering (SSME) where it is about bringing science to the art of services
and vice versa - bringing creativity into the sciences.
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In Singapore, IBM has collaborated with the National University of
Singapore, Nanyang Technological University, Singapore Management
University and Institute of Systems Science, together with industry
partners, to include SSME into their curricula. There is a lot more to be
done in developing our services talents to give us the competitive edge
and place Singapore on the frontier of the explosive global services
economy.
It is my hope that the government and businesses continue to recognise
the importance of and place an emphasis on investing and upgrading the
skill sets of our workforce, starting with our students in the education
institutes, right up to the professionals in the workplace.
Charles Reed
CEO
DOCOMO interTouch
THE numbers speak for themselves - Singapore alongside other regions
like the Americas and Europe, continue to recognise this great potential as
the services sector consistently expands across the board, and enterprises
start reversing their downsizing measures.
Services still make up the bulk of the world's economic activity and
continues to be a key component of a country's economic structure.
And why is Singapore so successful in the services sector? Singapore is a
wonderful place to work; rule of law and political stability are just some of
the reasons.
The main criteria for success is Singapore's resource pool - its people.
Hard working, diligent and service orientated. Singapore leads the world
with some of its services and is starting to export these.
The services sector will remain an important part of Singapore's business
growth because at the heart of services is the people of Singapore.
Dhirendra Shantilal
Senior Vice-President, Asia-Pacific
Kelly Services
ALTHOUGH the services sector has been more resilient and weathered the
current global economic crisis better compared to other sectors such as
manufacturing, the goods and services sectors will remain vitally
complementary in Singapore.
While services will play a key role in driving the future growth in industries
such as banking and finance, and information and communication,
organisations providing services should also identify what will differentiate
their offerings and look at diversifying their business portfolio.
The continued and robust expansion of the services sector will add another
dimension of stability to Singapore's GDP growth.
In addition, producing services tends to entail relatively more human
capital.
As a result, there will be a greater demand for a more educated, skilled
and multi-faceted workforce, which may prompt a higher investment in
education and human capital development that will ultimately benefit
businesses.
From this perspective, organisations in the services sector should look at
preparing for the renewed and increased demand with continued training
and education, in order to equip their talent with the right skill sets and
competencies for the upturn ahead.
Benedict Soh
Executive Chairman
Kingsmen Creatives Ltd
WITH no natural resources, Singapore is dependent on the talent and
integrity of its people, as well as the country's reputation.
Its focus on value-added services for financial, infocomm, engineering,
architecture and design, is beginning to pay dividends.
Many service providers in these sectors are already world-class; therefore
it is not surprising that services will power the growth of Singapore in the
future.
Using knowledge and professional services to expand our market
penetration across the globe can only be positive for Singapore's future, as
in the Internet age, quality in production alone brings little differentiation.
'Soft power' offerings such as appropriate branding, quality product
delivery and after-sales will boost Singapore's manufacturing capabilities.
Jansen B Ek
Vice-President and General Manager - A-Pac
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Intermec
THE recession has spurred the Singapore economy's natural evolution
towards one that is more knowledge-based and focused on services.
With one of the best educated workforces in South-east Asia, and through
government initiatives such as the Spur (Skills Programme for Upgrading
and Resilience); we have slowly but surely nurtured a talent pool that we
can capitalise in 2010.
Not only can we expect to see growth in areas such as business services;
but across the board, companies are increasingly seeing service provision
as a key differentiator and growth driver.
One implication is that IT companies will rely even more heavily on quality
services to compete and add value for customers.
Joshua Yim
CEO
ACHIEVE Group
AS a human capital solutions provider, we have already experienced an
increasing demand for workers in the services sector over the past two
quarters.
Defined by lifestyle, healthcare, hospitality, finance and professional
services, the services sector is always a key economic propeller in mature
economies such as Tokyo, London and New York.
Correspondingly, it will be the eventual direction Singapore would head
towards next year and beyond. In contrast, demand in the manufacturing
area tends to be weaker except for high innovation areas such as R&D.
This is inevitable as Singapore has become too expensive in terms of
labour cost.
Dennis Choo
Managing Director, Asia-Pacific
Premiere Global Services
IN a services-driven economy, the most important assets a company has
are its people and the technology that supports them. As emphasis shifts
from manufacturing to services, business leaders need to develop
strategies and infrastructure that are cost effective and sustainable in the
long term.
Technologies like Web conferencing and digital notifications reduce
operating expenses, improve cash flow and increase productivity, giving
employees time not just to execute day-to-day operations but also to
innovate.
The Singapore government has anticipated the changes ahead and has
begun executing plans to support those changes with the Infocomm
Development Authority of Singapore (IDA) leading the way through its
Intelligent Nation 2015 plan.
Intelligent Nation 2015 (iN2015) is a 10-year plan that incorporates ideas
and views from individuals in the private and public sector, guiding
Singapore in its development as a global city, recognised as a synthesis of
technology, infrastructure and talent. It is a living plan intended to give
every individual seamless access to intelligent technology - and with it -
the freedom and ability to connect, innovate, personalise and create.
Choe Peng Sum
CEO
Frasers Hospitality Pte Ltd
IF our own growth story at Frasers Hospitality Pte Ltd over the past years
is any indication, the services sector looks set to play an increasingly
dominant role both in the context of the Singapore economy, and driving
the development of Singapore companies internationally.
The challenge of course, for Singapore, will be managing our human
capital. The rapid growth of the services sector across Asia and the
resulting drain on expertise from Singapore, underscores more than ever
the need for the development of strategic human capital practices here at
home base.
Lim Soon Hock
Managing Director
PLAN-B ICAG Pte Ltd
SO long as global unemployment persists, which invariably causes global
consumer demand to remain weak, the manufacturing sector will languish
in the doldrums. In this scenario, we can expect services, without all the
concomitant carrying costs of inventory, capital expenditure, etc, to play a
key role in driving economic growth in 2010. It is a fait accompli.
The current financial crisis highlights the vulnerability of Singapore's
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over-dependence on manufacturing. Countries in the region, for some
years now, offer manufacturing capabilities and capacities, at lower costs
with the same quality, if not better. China has evolved to become the
manufacturing centre of the world. It is increasingly more difficult for
Singapore to compete in this space
I expect the services sector to evolve to become the mainstream GNP
contributor in the future. It is a natural evolution for Singapore, when you
consider that our only assets are human capital and financial capital. Our
strategy must be to exploit both these assets to the fullest, to drive our
future economic growth.
According to the Bloomberg Global Poll, Singapore is now the world's
second financial centre, after New York. There is no reason why we cannot
be the first, much like what we have achieved for our port and airport and
in the process, make services play a key role to fuel our economic growth.
Apart from financial services, we can exploit our human capital in R&D,
our high IT literacy, education know-how and our government's expertise
in infrastructure development.
While we rightsize our manufacturing sector, Singapore can move
upstream and concentrate on R&D, leveraging off the infrastructure which
our government has put in place. Singapore can serve as an R&D centre
for both MNCs and local companies, to support their global network of
manufacturing plants, especially in China and other countries in the region.
In the field of IT, businesses can also learn from the experience of India;
again there is no reason why we cannot tap on our high IT literacy rate, to
excel to become a software centre. In my opinion, we have missed out on
this opportunity, more than a decade ago, when India started out.
Arising out of the financial crisis and increasing competition of countries as
attractive manufacturing bases, the economics of doing business will
compel many companies, both MNCs and local companies across
multifarious industries, to diversify and concentrate on services, taking
advantage of the comparative advantages of Singapore in management
talents, R&D expertise, etc, and the lower costs of manufacturing in
countries in the region. Businesses have no choice but to adapt if we are to
continue to be successful and to stay ahead of the game.
R Dhinakaran
Managing Director
Jay Gee Enterprises Pte Ltd
SINGAPORE with its limited natural resources and high cost factors of
production has been gradually moving towards the services sector from a
manufacturing-sector-dominated economy. With the demand in the
Western world yet to pick up strongly, growth in manufacturing-led
exports in the immediate future is constrained. The services sector is more
diversified with greater avenues for growth.
With Asian economies already recovering well, economic activities in the
region including visitor traffic is steadily increasing, leading to increased
opportunities for the service industry in the travel, retail and leisure
segments. Singapore's strength to continue attracting investments in the
financial sector will remain its advantage as services dominate the
recovery path in Singapore.
Eric Hoh
Vice-President, Asia South Region
Symantec
OVER the past decade, the government has made a concerted effort to
reduce our dependence on exports and manufacturing, and this has
sheltered us from the worst of the economic downturn.
As the Singapore economy gears itself for post-recession growth, it is
important for us to continue to diversify our growth areas, and identify
new industries and markets for future expansion.
I agree that modern services such as financial intermediation, business
services and information and communications can be key economic
differentiators for Singapore, enhancing our competitiveness and
strengthening our economy in the long term. The information,
communications and technology sectors, in particular, have great potential
as businesses look to make efficient use of ICT to maximise their
resources, automate key business processes and increase their
competitiveness, thereby benefiting from an optimised environment.
We at Symantec are poised to help organisations use technology to better
secure and manage their information and infrastructure, improve
productivity and reduce costs, ultimately emerging stronger from the
downturn.
Deb Dutta
Vice-President
Brocade - Asia Pacific
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SINGAPORE'S services sector has been resilient in the current downturn
compared to the export of goods and trade-related services. Over the
years, several ministries have catalytic measures for Singapore to become
a regional hub for healthcare, logistics, business outsourcing, digital media
development and education.
However, I doubt the intrinsic capabilities of broad-base services to
assume a key role in driving economic growth next year. Besides, the
maturity of the services delivery capability is also dependent on the
propensity of Singapore's global partners to engage Singapore. We have
no control over this demand.
I do feel the need to bolster its quality of service in addition to maintaining
the current volume from the manufacturing sector. The quality has
definitely dipped in recent times. Besides sectoral risk mitigation, capital
formation, job creation and workforce retraining, the sector-specific
service knowledge-base once quickly built, can become a national
intellectual property. The IRs might be a good starting point.
David Leong
Managing Director
PeopleWorldwide Consulting Pte Ltd
FOR any sustainable growth in Singapore, a service-oriented infrastructure
empowering the service economy must evolve in a flexible and
dependable way. This will include financial intermediation, business
services and information & communications and lifestyle services.
There is demonstrable growth and continued strength in the services
industries.The service industry was the major contributor to growth in the
last three quarters of the year. Singapore needs to preemptively alter its
economic DNA by not relying exclusively on the manufacturing sector.
While exports of manufactured goods in chemical, pharmaceutical,
biotechnology, electronics and oil refinery products remain key export
indicators, other sources of growth must be nurtured.
Such diversification will help reduce the vulnerability of growth to large
swings during crises and minimise the economy's dependence on a few
correlated sectors. However, in the near term, it is unlikely that services
will take over the mantle from manufacturing as Singapore's growth
engine as it moves into its post-recession gears.
Singapore, despite our size, attracted global attention when it successfully
hosted the world's first-ever Formula One night race. Singapore playing
host to the Asia-Pacific Economic Cooperation (APEC) meeting and hosting
of the Youth Olympics simply means that Singapore will want to be a hub
for such exciting activities and these events will surely reap significant
economic spin-offs for various trades for the country, in the form of
increased tourist influx and swelling patronage for side entertainment and
other associated events.
Come 2010, our two integrated resorts (IR) namely, Marina Bay Sands
and Resorts World in Sentosa, will be launched. The IRs will position
Singapore as a must stop-over destination in Asia offering a wide range of
entertainment experiences for the leisure and business visitors, thus
enhancing tourism receipts.
The resorts will promote Singapore's status as a convention hub in Asia
and thereby positively impact the supporting industries, such as
hospitality, healthcare, entertainment, F&B, transport & communications
etc, apart from attracting huge investments and opening up employment
opportunities directly and indirectly.
Singapore is very advantageously located in the Asian region which, is
home to the burgeoning middle class demanding quality lifestyle products
and services including wealth management services enticing the growing
high net worth individuals in Asia.
With such prospects over the horizon, it will be a new dawn for Singapore.
Dora Hoan
Group CEO
Best World International Ltd
SINGAPORE'S Integrated Resorts projects, expected to be in full swing by
2010 are intended to be distinctive world-class developments that will no
doubt boost the growth of the service sector. This will be propped up by
amenities and infrastructure support services through hotels, convention
facilities, themed attractions, luxury retail, fine dining and casino gaming.
However, Singapore should be able to realise the expected influx of
tourists and business visitors to really profit from this development,
otherwise, the apprehension is that there may not be a broad enough
consumer base to support the huge investment.
Indeed, it's a gloomy outlook for manufacturing, as the economic climate
improves gradually but may take some time to fully bounce back.
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Those in the manufacturing sector will be compelled to either seek
opportunities overseas or prepare themselves for a new set of skills for a
change of career path.
The outlook for Singapore with the expected boost from the service sector
of the economy is positive on the whole.
However, we must take a closer look at the complications being felt
particularly by smaller enterprises owing to rising business costs - higher
costs of supplies, continuing surge in office rents, among others, are really
affecting operating costs and making smaller companies barely able to
compete on a level playing field in many aspects and unable to offer better
compensation for their employees.
To make matters worse, rising household costs on the other hand means
falling consumer demand and should also be factored into the list of
concerns. Unless all these are addressed as a whole, the service sector
alone may not be able to sustain the post-recession economic growth and
recovery at the pace and manner we have envisioned.
Gavin Selkirk
Corporate Senior Vice-President & General Manager
CA Asia-Pacific & Japan
ALL signs are that the services sector will be the spearhead of Singapore's
thrust back into growth, following two buoyant quarters. Armed with the
wisdom of hindsight, enterprises in the services sector will now be seeking
to cut waste, reduce cost, boost productivity and mitigate risk like never
before.
The good news is that today's IT sophistication is enabling businesses to
achieve unprecedented efficiency, especially in terms of trends such as
software-as-a-service (SaaS). CA On Demand solutions, for example, offer
full functionality with faster implementation, so that organisations can
duck hefty upfront investment and avoid the time-lag associated with
on-premises deployment.
I'm pleased to say that news of CA's prowess in technologies such as
SaaS, virtualisation and cloud computing, are hitting the headlines at a
time when CIOs are starting to feel the confidence to peer further into the
future - and not just on IT issues promising immediate payback.
David Ang,
Executive Director of SHRI
There is a gradual change in the world economy from agrarian to industrial
to the present knowledge economy and services sectors are important
elements in this contemporary knowledge economy. It is an
environmental consequence of the economic progress.
The services sector has played an important role in cushioning the
negative external impacts on Singapore during the economic downturn.
From a sectoral perspective, Services will definitely feature very strongly
next year, especially with the opening of the two Integrated Resorts and
thereby strengthening Singapore further as a tourism hub in SE Asia. This
will further create economic growth in other sectors as well, thereby
pushing the overall economic growth for Singapore.
Businesses in the services sector will prosper provided the regional and
global economic recovery is sustained and broad-based. At the same time,
Singapore will continue to re-position and strengthen itself in the
manufacturing sector, eg in the higher value and knowledge-based mfg,
including R&D, and creation of new products and establishment of new
manufacturing facilities. The Manufacturing industry and Services industry
are regarded as twin engines of Singapore economic growth, with the
former contributes 25% of Singapore's annual GDP. There has to be an
integrated approach to balance the two. Singapore needs to relook at the
prospect of integrating them and making the development sustainable.
With the Services sector gains economic momentum, human capital
becomes an important determinant of the services sector output. The
economic growth also contributes to higher demand for services and hence
it has implications for the services sector output. Because of increased
competition from countries like China and India, it is imperative that
Singapore further develops and increases its human capital competencies
and skills set. Increased availability of human capital through increased
spending on advanced education and training will open up more
opportunities for Singapore to continue to attract foreign investment,
which is vital for its manufacturing sector.
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