Finance Minister outlines strategies for achieving sustainable growth through productivity improvements and workforce development
In a round-up speech on the final day of the Budget 2024 debate, Finance Minister Lawrence Wong emphasized that transformation is key for Singapore to meet its ambitious productivity growth targets. The country aims for annual growth of 2 to 3 percent over the next decade, with 1 to 2 percentage points coming from productivity improvements.
Wong outlined the need for continual transformation, including the adoption of new business models, upskilling the workforce, and fostering new industries to replace declining ones. He emphasized that growth must be driven by productivity, and one strategy to achieve this is attracting high-quality investments in cutting-edge technologies. Wong also highlighted the government’s commitment to research and development, with an additional S$3 billion allocated to the Research, Innovation, and Enterprise 2025 plan in Budget 2024.
Wong also acknowledged concerns about a potential divide between large multinational companies and small- and medium-sized enterprises (SMEs). He clarified that while outward-oriented businesses are naturally more productive due to global competition, there is a need to support domestic-oriented businesses to restructure and boost productivity.
Moreover, Wong addressed concerns over inflation, noting that the best way to handle it is through real growth in businesses and wages. He reassured that Singapore’s GST increase, implemented in two steps to 9 percent, will be sufficient to cover the government’s spending needs up to 2030.
