Full transcript of Second Minister for Finance Jeffrey Siow’s speech in response to WP’s motion on Singapore’s future economy (5 August 2026):
Mr Speaker,
Let me begin by thanking Members on both sides of the House for a thoughtful, wide-ranging and constructive debate on our economy.
Many have observed that our world has changed; constraints are tighter; and our economic future could be more uncertain.
I am glad Members across the House recognise that Singapore must refresh our economic strategy. That is precisely why we started the Economic Strategy Review (ESR) a year ago.
The ESR was one of the most extensive reviews in recent years. Five ESR Committees engaged more than 7,700 people over nine months. These included:
Business leaders of large and small companies.
Trade associations and chambers representing SMEs.
Unionists supporting and championing workers’ interests.
And experts with decades of experience – including academics, venture capitalists, senior civil servants, and global CEOs.
Many of these people are on the economic frontline, making decisions today that will shape the direction of our future economy.
The ESR was a collective endeavour by all of these Singaporeans. This is how we were able to produce a comprehensive blueprint grounded in experience and reality.
Today, we have heard several speeches from the Workers’ Party (WP). Sifting through the issues raised, nevertheless, I found agreement with quite a few of the Workers’ Party’s proposals.
For instance, there were suggestions on how to better support our SMEs and startups, and build a stronger base of local companies. These goals are not in dispute, and the ESR report set out specific recommendations, whether on more broad-based support for overseas expansion, or nurturing the next generation of Singapore Global Enterprises.
While we can debate the details, it is clear that the suggestions from the Workers’ Party are not so much a “different economic playbook”, but instead, very much in line with the direction of the ESR.
So, we have considerable common ground. We do want an economy with dynamic local enterprises and good jobs for Singaporeans. There are some differences over the means of achieving these goals. But there is no need to overstate these differences.
However, there is one significant difference we need to address. This is in how we understand Singapore’s economic model. From the speeches I have heard, the Workers’ Party appears to believe that Singapore’s economic model is imbalanced, and needs to be fundamentally re-oriented. They have portrayed Singapore as a place where MNCs create wealth, and there is some Faustian bargain where SMEs are held down and Singaporeans receive the benefits through redistribution.
I disagree with this characterisation.
This is not an academic disagreement, but one that is crucial to the policies that we will pursue. If the original diagnosis or assumption is wrong, the proposed remedy will send us in the wrong direction. The wrong medication may cause us even more harm than good.
For example, Mr Kenneth Tiong referred to the Government having a universal land pricing model. This is simply untrue. Our framework is already differentiated. Land is priced differently, at fair market value, based on its intended use – which could be residential, commercial, industrial, community, educational, or religious. Now, we can debate whether there is sufficient flexibility in the current framework and whether there could be and should be further differentiation, but this is quite different from suggesting that the current framework is fundamentally flawed. On the contrary, our clear and transparent framework ensures responsible stewardship of our limited land resources.
I want to emphasise that the PAP Government’s economic strategy has always been built around Singaporeans, whether as workers, professionals, investors, entrepreneurs or business owners. Our people, not companies, are at the centre of everything we do.
Economic growth has never been an end in itself. It is a means to an end – to create better jobs, higher incomes, and better lives for Singaporeans. And by that measure, Singapore’s economic model has delivered, for generation after generation of Singaporeans.
MNCs and local SMEs
The WP’s view is that MNCs and local firms are competitors for a fixed pie. Associate Professor Jamus Lim suggested that the Government is not supporting our own SMEs as much as we do for MNCs, and that we must pivot from MNCs to SMEs.
But as my colleague, Mr Edward Chia, has already pointed out, this is a false choice.
For our economy to thrive, we need both MNCs and SMEs in Singapore to succeed.
In a more difficult global environment, we have to compete harder for foreign investments. We must also work harder to support our local companies.
We are not in a zero-sum situation. In fact, the growth of our local companies and our MNCs mutually reinforce each other.
SMEs are critical to our economy.
They employ the majority of our workforce.
Many enterprising Singaporeans start their own businesses to forge their own paths, and strive for their hopes and dreams.
Senior Minister of State Low Yen Ling has spoken in detail about the robust support ecosystem for SMEs. Minister of State Dinesh Vasu Dash shared how we have built up our startup ecosystem over the years. I will not repeat what they have already covered.
But very few countries support local companies like we do here in Singapore. Every year, the Government provides nearly two billion dollars in direct grants and loans to our local SMEs, to build stronger capabilities, embark on new projects and compete successfully in global markets.
Not all of these schemes are fully utilised today. We will do more to help more companies make fuller use of the support available. And if demand for these schemes grows because more companies are stepping up and making use of them, let me state for the record that the Ministry of Finance stands ready in support with more resources.
Of course, if this was just about spending more money, we would already have many more world-class companies.
But many of us understand that building a company is very hard.
Mr Mark Lee and Mr Azhar Othman have spoken passionately about their experience, as business leaders themselves, and also in their roles now supporting SMEs. Building a business requires many factors: stronger leadership, deep technological capabilities, access to capital and talent, and the confidence to venture overseas.
That is why in 2018, we reorganised agencies in the then-Ministry of Trade and Industry to form Enterprise Singapore – a new Statutory Board with a clear mission to support our local companies end-to-end – start-up, capability building, innovation, financing, talent, internationalisation.
I had the privilege to serve as the first Managing Director of Enterprise Singapore.
My colleagues and I were deeply motivated by our mission. We made it a point to use Singapore-made products in the office: locally made coffee and tea; chairs and cushions; even the snacks in our vending machines, as a small reminder every day that our mission was to support and champion our local enterprises.
Every success by a Singapore company – a new product, a new market, a new investment – was a success that we celebrated together.
Our officers worked hand in hand with the SMEs. Our companies know that we walk this journey with them side by side.
Because when Singapore enterprises thrive, they create more jobs and opportunities for Singaporeans. We all have a stake in their success.
In a more fragmented global economy, it has indeed become more difficult for SMEs to venture overseas.
Tariffs have gone up.
Industrial policies are now back in fashion.
The path from local company to global enterprise seems much steeper than before.
But that does not mean that we should turn inward.
The WP asserts that if external markets become more uncertain, we should retreat, and rely more on domestic demand.
This is unrealistic. Our domestic market is simply too small. Mr Mark Lee, who leads the Singapore Business Federation, pointed out that domestic demand cannot be our primary engine for growth, and I cannot agree more.
The answer is not to turn inward. It is the reverse: to strengthen our companies to compete more effectively in more overseas markets, with greater resilience.
This is why following the US Liberation Day tariffs last year, we set up the Singapore Economic Resilience Taskforce, chaired by Deputy Prime Minister Gan Kim Yong, to help our businesses adapt.
Many companies have benefited from our efforts. For example, Castlery, an online furniture company with 70% of its revenue from the US, has diversified its manufacturing base, with Enterprise Singapore’s support. In fact, Castlery has pivoted so well that it has recently opened up its first brick-and-mortar store in New York City, which I hope to visit soon.
Even as we redouble our efforts to support our local companies, we must not forget that MNCs remain important to our economy.
MNCs are attracted to Singapore not just because of the incentives we give, but because of our entire ecosystem – our capabilities, our workers, our SMEs.
Mr Saktiandi Supaat spoke in detail about how in turn, MNCs generate positive spillovers for the economy. When global companies set up deep capability here – a research centre, a regional headquarters, an advanced manufacturing line – they do not simply occupy space that local companies might otherwise have filled.
But they bring in resources, capabilities and technology we do not yet have. This includes artificial intelligence (AI) capabilities, which would take us years to develop on our own.
Many of our local companies grow and succeed because of their relationships with MNCs, not in spite of them.
For example, Sunningdale Tech is a Singapore precision engineering company which started off as a small-scale manufacturer of plastic products. It has grown to be a large company, alongside its blue-chip clients like HP, Illumina and Dyson.
When I attended a major industrial trade fair last year, I was proud to see many more local manufacturers – smaller than Sunningdale, but ready to grow, showcasing their innovations and products to a global audience.
Just as importantly, global companies create good jobs – high-skilled, high-paying jobs.
More than two-thirds of senior management positions in MNCs in Singapore today are held by Singaporeans.
These often have regional or even global responsibilities, which means Singapore can have a greater influence in economic decisions beyond our small size and population.
Many jobs are generated for young Singaporeans too.
I visited Applied Materials last year. Applied is an American company producing high-end equipment for semiconductor manufacturers such as TSMC, Samsung and Micron. Mr Saktiandi mentioned that Applied Materials had invested in building a second campus at Tampines; they told me about it with great excitement when I visited their first facility at Upper Changi.
At Upper Changi, I met Ms Chua Khai Shuen. Khai Shuen had interned at Applied while studying mechanical engineering in NUS. She was very happy to be hired upon her graduation, so she could continue with the projects she started.
Khai Shuen’s story is not unique. There are many like her, building their budding careers in global companies based in Singapore.
During our house visits, I am sure many of us would have met parents who proudly tell us that their son or daughter is working in Google or Microsoft, Blackrock or JP Morgan, Micron or GlobalFoundries, Boeing or Rolls Royce.
It would be much harder for a Singaporean to work in any of these companies, if the companies were not based here in Singapore.
The support we provide to attract foreign investment and the support we provide to local enterprises are complementary and mutually reinforcing. The resources we commit to attracting investments do not come at the expense of supporting local enterprises.
The converse is also true. If we reduce the resources that we commit to supporting this ecosystem we have built, then not only would we risk MNCs leaving Singapore, even local companies would think about operating in other jurisdictions.
At a time when countries are spending more than ever to attract and reshore strategic investments, our response surely cannot be to do less. Giving up these investments would mean fewer high-quality jobs and fewer opportunities for Singaporeans. This cannot be our approach.
Conclusion
Mr Speaker, let me conclude:
The ESR began with a simple but urgent premise.
The world is changing, and Singapore must reinvent ourselves.
But as we do so, we should be clear about what needs to change, and what should stay the same.
Our task is not to discard what has made Singapore successful, but to renew and strengthen our formula for a changed world.
We are not choosing between SMEs and MNCs. We need both.
We are not choosing between domestic demand and external markets. We need both.
This is why I fully support the amendments to the motion as proposed by Mr Edward Chia, which reflect our economic strategy holistically.
Mr Speaker, our enterprises have ambitions that extend far beyond our shores, further than perhaps what the Workers’ Party think they are capable of. Our job is to help our companies realise their ambitions, and not hold them back.
Ultimately, the ESR is not going to be judged by the number of schemes we create, or the amount of money that we spend. It will be judged by its outcomes: better jobs, higher incomes, more social mobility and greater resilience. And whether Singaporeans have the confidence that they can build better lives for themselves and for their children.
This is why it is so important that the ESR is a whole of society effort, led by a new generation of business, union, society, and government leaders, who will collectively own these outcomes.
Mr Speaker, throughout our history, whenever the world has changed, Singapore has adapted.
We have stayed open. We have continued to build our capabilities. And we have always invested in our people.
This is how we earned our place in the world. And this is how we will continue creating opportunities for ourselves.
Mr Speaker, I support the amended motion. Thank you.
