: Companies should be aggressive in going abroad despite global uncertainty: EnterpriseSG chairman
DESPITE deglobalisation and geopolitical uncertainty, Singapore companies should double down on going abroad for growth, said Enterprise Singapore (EnterpriseSG) outgoing chairman Peter Ong in an interview with local media.
EnterpriseSG will continue to support this, he said, as part of its two key strategies: developing growth industries and grooming local enterprises. Beyond providing grants to companies that need help, the statutory board’s focus is on nurturing potential winners.
Granted, the volatile economic environment makes it more challenging for businesses – especially smaller ones – to internationalise, said Ong.
But he stresesd that globally, Singapore companies are still seen as favourable partners that are neutral and of a high quality.
EnterpriseSG, along with its overseas partners, will continue to “demystify and smoothen the path for companies” to go abroad, he said. “If you’re prepared to take the plunge and go overseas, especially to a frontier market, it’s our job to help you as much as we can.”
“I would encourage Singapore companies – be aggressive and go out.”
Looking back
In his final interview as EnterpriseSG chairman, Ong looked back at the agency’s key achievements and laid out its strategies for the future.
After more than 30 years helming key ministries, the career civil servant became EnterpriseSG’s founding chairman on Apr 1, 2018. He will step down at the end of March and be succeeded by EnterpriseSG chief executive Lee Chuan Teck, who will be redesignated as executive chairman.
EnterpriseSG was formed in a merger of statutory boards Spring Singapore – which helped small and medium-sized enterprises (SMEs) build capabilities – and IE Singapore, which encouraged enterprises to go abroad.
At the time, Singapore faced significant economic headwinds and the government wanted to provide a “full suite of end-to-end solutions” to support local enterprises to grow, said Ong.
Under him, the agency focused on helping companies pursue productivity, innovation and internationalisation.
Its efforts include the Scale-Up programme, which identifies and accelerates the growth of high-potential enterprises, and the Global Innovation Alliance (GIA), which supports businesses to expand abroad.
The outcomes have been promising, said Ong. The first three cohorts of the Scale-Up programme recorded a 68 per cent rise in revenue growth, on average, within two years of joining the initiative.
Meanwhile, the GIA nodes in Bangalore and Mumbai have helped nearly 350 Singapore startups enter India.
For SMEs, the Start Digital programme was launched in 2019. Said Ong: ”We knew we had to find ways to uplift productivity, and we knew that digitalisation will be a key driver.”
From its original focus on enterprise development, EnterpriseSG had to turn its attention to enterprise resilience when Covid-19 hit in 2020. Now that Singapore has emerged from the pandemic, the agency is in its third phase: focusing on enterprise growth.
Said Ong: “Once Covid restrictions were lifted in Singapore, we told our companies to go out and make up for lost time. Go for growth, go to whichever markets are open.”
Companies heeded the call. In 2023, the number of companies venturing to new markets for the first time was 66 per cent higher than in pre-pandemic 2019.
New strategies
The schemes introduced in the last six years have “planted the seeds”, and EnterpriseSG will continue with this work, said Ong. But the agency also has two new strategies.
One is to grow a new generation of Singaporean companies into “global champions”, through the Singapore Global Enterprises initiative.
“We are looking for Singapore companies that are able to produce globally competitive, innovative goods and services that the world will want and where we can be a leader,” said Ong, citing Singapore Airlines and PSA International as examples of leaders in their respective fields.
EnterpriseSG hopes the initiative can complement and build on the groundwork laid by the Scale-Up programme, which has gone through nine cycles so far with a total of 92 participating companies.
“Each (company) we hope will be characterised by founders and owners who have fire in the belly and ability to bring in top talent… to implement and execute the growth strategies that they are looking at,” said Ong.
The second strategy is developing industry clusters with growth potential or where Singapore has existing capabilities. Two industries have been identified so far: offshore wind and precision medicine.
With these twin strategies, alongside existing schemes, Ong hopes to see “many more Singapore companies take their place on the global marketplace” in the next 10 years.
This will not just help Singapore to make its mark internationally, but also create better jobs for locals, he added.
Ong flagged artificial intelligence (AI) and climate change as major trends that both pose challenges and provide opportunities.
“AI will not spare any industry,” he warned. But he is optimistic that Singapore is in a good position to ride the trend, as a highly connected and digitalised nation with a skilled talent pool.
On the climate front, Singapore’s ability to harness renewable energy is limited, but it can be a centre for research and development and green financing. The Republic also has the engineering expertise to develop decarbonising initiatives for each industry, be it manufacturing, aviation or maritime.
Supporting small businesses
Asked if businesses might have become reliant on support, and if EnterpriseSG will taper this down to focus on its new goals, Ong replied: “I don’t foresee a day when we say that small companies will not get any help.”
“For us, the key is not size per se, it is willingness,” he said. “Are you willing to do some upgrades, do some transformation, do some reskilling? I think if you are, we are prepared to help you.”
Support for SMEs was cranked up during Covid to help them stay afloat, he noted.
In the main pandemic years of 2020 and 2021, EnterpriseSG supported more than S$26 billion in approved loans for 27,000 enterprises, compared to just S$2.2 billion for over 7,900 businesses in pre-pandemic 2019.
Funding support levels were raised for the existing Productivity Solutions Grant and Market Readiness Assistance schemes, to a maximum of 80 per cent.
“But after Covid, we’ve brought them down to more ‘peace-time’ rates. We think that for peace time, that’s the right solution and that’s the right level to peg at,” he added. Support levels have been lowered to 50 per cent since April 2023.
That said, not all of EnterpriseSG’s schemes are meant for all firms, said Ong. The agency is more selective when it comes to schemes which are more ‘bespoke’, such as the Scale-Up programme.
Regardless, firms who wish to access any schemes and grants must show that they have upgraded as a result of the help received, he added. “Because if you’re just here for a handout, then we are not that interested.”
Source: The Business Times © Singapore Press Holdings Limited. Reproduced with permission.
