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EVEN as a government-led panel prepares a blueprint for new ways to grow the economy, a think-tank has outlined what Singapore needs to do to remain competitive and relevant in the global marketplace.
Chief among the recommendations of the Asia Competitiveness Institute (ACI) is that businesses must address declining labour productivity levels by going beyond just getting workers to go for training to up their skills level.
Companies have to change the way they do business, redesign work pro-cesses and provide products and ser-vices with higher customer value, the ACI said in its Singapore Competitiveness Report 2009 released yesterday.
The report provides policymakers with 'options to consider while preparing Singapore for the next level of competitiveness', said a statement from the ACI, which is part of the Lee Kuan Yew School of Public Policy.
Its recommendations are directed at the Economic Strategies Committee led by Finance Minister Tharman Shanmugaratnam and tasked with finding novel ways to transform the economy. The ACI's report said Singapore should not overreact to the current economic crisis as its fundamentals are solid and there is no reason to make dramatic changes.
Said ACI director Neo Boon Siong: 'We are not falling off the cliff, so there's no need for major changes for the immediate or short term.'
But it suggested ways to boost the economy such as by improving productivity. Said Professor Neo: 'Despite the overall economic growth in the last few years, there are concerns about Singapore's ability to generate sustainable productivity growth.'
Singapore's productivity has dipped for seven straight quarters since the end of 2007. It ranks third in the world in overall competitiveness, but is 19th in labour productivity.
The gap can be narrowed by getting companies to determine how they can produce more and better-value products using technology, innovation and better work processes.
ACI also said while there has been progress in science-related innovation, success in creative and entrepreneurial activities is limited. A possible reason: The presence of government-linked and multinational companies makes it harder for local start-ups to grow and attract talent.
But if the Government worked with firms on schemes that allow local managers to create business spin-offs, it would sow the seeds 'for more locally rooted entrepreneurship and ultimately innovation'.
Singapore could also develop its public services expertise into an export industry and provide consultancy services in areas like governance and managing operations like airports.
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