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This year, our economic outlook is improving but mixed, both internationally and in Singapore.
Internationally, we are seeing an upswing in America, Europe, Japan and the emerging economies. The US markets have reacted optimistically to the election of President Trump. But on the downside, prospects for international trade are uncertain. The US attitude has changed. It has pulled out of the Trans-Pacific Partnership, and prefers bilateral deals instead. When the G20 Finance Ministers met recently, they were unable to renew their standard pledge to keep global trade free and open, because the US objected. We will have to watch how other countries react to this US stance. If they too adopt win-lose approaches to trade, the result will be more protectionism, which will hurt everybody.
In Singapore, the good news is that our economy is picking up, and we may do better than last year. Our total employment is expanding, but we are also seeing more retrenchments, and unemployment is creeping up. The mixed picture shows an economy in transition. Businesses are turning over and restructuring to adapt to changing conditions. Some existing jobs are being lost, even while we are creating more new jobs.
Our response should be to work hard to keep up our growth. Our economy can no longer grow at 5-7 per cent but we can still achieve 2-3 per cent growth by improving our productivity. 2-3 per cent is a good growth rate for our current stage of development. It will mean we can continue creating new jobs and improving our lives.
We must also work harder to help workers stay employed, and find replacement jobs if they become unemployed. Other developed countries have unemployment rates of 5 per cent or higher. Our rate is currently lower at 2.2 per cent, but as our economy matures, I expect that to creep up.
This has to be a tripartite effort. Our businesses must be willing to transform, adopt new technologies, expand overseas and seize the opportunities out there. Our workers must be adaptable, keen to upgrade and reskill themselves, when necessary changing careers to secure good jobs. The Government will take the lead, and give full support to employers and workers. SkillsFuture and “Adapt and Grow” offer concrete help to workers. Workers who have lost their jobs can turn to job-matching and Professional Conversion Courses. We are paying close attention to PMEs, who worry about being displaced. The Government is always on the side of workers, but we make sure we are business-friendly and support our businesses to grow so that we have jobs for all.
This is what Tripartism is about – everyone doing their part, working together, and progressing together. This spirit of Tripartism has helped us overcome many challenges. I am confident that it will carry us through this next stage of transformation.
Happy May Day!
