Henry Kwek (Nee Soon GRC) at 2018 Budget Debate
I rise in support of the Budget.
General Pointers on Budget
1. First, I would like to make three general points on the budget.
2. One. We must be wary of dipping too much into our reserve income.
a. We can argue about the precise percentage of NIRC, but we must continue to grow our reserves.
b. If our reserves do not grow, it may not continue to anchor the stability of our growing economy.
c. As a small city-state, Singapore has been described as a small ship in a big ocean.
d. During the last big storm, the 2008 Global Financial Crisis, our reserves served as an anchor, thereby providing us with much needed stability.
e. Recently, some have commented that our reserves are already large and sufficient, so we can afford to spend a lot more of our reserve income.
f. However, because our economy is still growing, we are actually a small ship that continues to grow in size.
g. With geopolitical uncertainty, and the rolling back of financial regulations in US, the only certainty is that more and bigger financial storms will eventually come our way.
h. If our reserves fail to keep up with our growing economy, maybe not at the next crisis, but a few crises down the road, our reserve might not be sizable enough to anchor the bigger Singapore economy then.
i. If Singapore flounders, who will save us? IMF? World Bank? Even if they do, at what cost, especially for the Singaporean on the street?
j. Therefore, we must be wary of the serious implications of not growing our reserve.
3. Two. Our government must actively help our seniors to monetise their assets, to pay for their retirement.
a. Because retirees have no income, they are more impact by GST than other Singaporeans.
b. Some retirees, even those living in private estates, are asset rich and cash poor.
c. To help them manage the cost of living, I hope our government can put urgency to help them monetise their assets.
d. I have spoke about this issue in depth during the recent Feb parliamentary motion on seniors’ policy.
e. I hope the government can actively ensure that such options exist in Singapore – either through reverse mortgage of larger flats and private estates to do reverse mortgage, or through specialised reverse mortgage funds done in France.
4. Three. We must recognise that ITM is a long-term economic transformation, and not rush for immediate results, especially in terms of economic output numbers.
a. Recently, some commentators spoke about the effectiveness of the ITMs.
b. But any major economic transformation needs at least 3-5 years before it fully flows into the economic output numbers.
c. Let me illustrate. For example, the government launches a new program to encourage businesses to use Artificial Intelligence in year 1.
i. Major businesses, with their budgetary process, will need up to a year to make major shifts to take advantage of the program. The efforts of the businesses will need time to impact the bottom line.
ii. After the impact is made, it would still take many months, even 1-2 years, before the improvements are reflected in any company’s audited accounts.
iii. And then more time is needed before the numbers are finally submitted to ACRA and to our Department of Statistics.
iv. That is why we need 3-5 years before we can fully comment on effectiveness of programs in terms of economic output numbers, whether it is GDP or Value Added per worker, or productivity numbers.
d. In the meantime, we should focus on our discussion on input indicators of economic transformation. By which I mean the quality and accessibility of our transformation programs, for our businesses and workers. And not be fixated on immediate economic output indicators.
5. Let me touch on my key point for today’s speech – getting Singaporeans to think ASEAN.
6. I agree with Minister Heng that Singapore must be a Global-Asian Node of technology, innovation and enterprise. By and large, we are making good progress.
7. However, I think we can do more to grow with rising ASEAN.
8. I am glad that our economic policies keeping up with rising ASEAN.
a. Beyond the Asia Economic Community, we are:
i. Setting up the Infrastructure Office, which will contribute to more infrastructure development within ASEAN,
ii. Extending the Global Innovative Alliance into the ASEAN Innovation Network, and
iii. Pushing for the creation of an ASEAN E-Commerce platform
b. Beyond the announced measures, I would further suggest that as ASEAN chair this year, Singapore should encourage other major ASEAN economies to increase funding for the ASEAN secretariat.
i. A stronger secretariat will improve ASEAN’s ability to track and execute various commitments, so as to unlock the full potential of agreed measures.
ii. For example, a stronger secretariat will be able to help us better coordinate action responding to non-tariff protectionist measures within the AEC.
c. I am also heartened to see the strengthening of our talent development program. This includes PCP for SEA ready-talent, SkillsFuture ASEAN Leadership Program, Go SEA Award, Young Talent Program, and Infrastructure Development Internship. I hope that if these programs prove successful, the government can quickly scale them up.
d. The creation of Enterprise Singapore, as well as the rollout of more programs to support companies internationalise, will strengthen our efforts.
9. Our businesses are already awaking to the possibilities of ASEAN, and are going regional. However, I strongly feel that much more work is needed for Singaporeans to Think ASEAN.
a. Today, there is a divergence between tremendous opportunities offered by ASEAN, and the perception of ASEAN by everyday Singaporean.
i. Many Singaporeans associate our neighbouring countries with affordable holiday destinations, or places where we go abroad to do community service.
ii. In fact, many Singaporeans assume that many parts of ASEANs are backwater regions, and will stay so for a long time.
b. But many parts of ASEAN are growing quickly, and these assumptions are no longer true.
c. As such, it is very important for us to change the mind-set, especially among our youths.
i. After all, while our government and our companies be more involved in ASEAN, the full benefits can only be unlocked if Singaporeans are prepared to be personally involved in the opportunities within ASEAN.
10. Therefore, I would like to propose five ways to encourage our people, especially our youth and our PMETS, to see the possibilities in ASEAN.
a. One. We should shift the balance of tertiary education internships, study trips, and exchange programs towards developing countries, especially ASEAN.
i. And when they go abroad, we should ensure that our youth see the bright spots and centre of innovations within ASEAN.
b. Two. Promoting exchanges between student leaders.
i. As a young Singaporean studying in US, I was deeply involved in the largest student leader exchange between US and China.
ii. That allowed me to understand the life-long friendships that can be forged over time, if the programs are properly executed.
iii. There is scope to do such a program linking the future leaders of Singapore with our other ASEAN countries.
c. Three. We should encourage more interaction between our students and officials from ASEAN countries who are studying in Singapore.
i. Today, many ASEAN officials spent short training stints in Singapore. They are here because they are slated for greater things back in their home country.
ii. There is a scope for us to network our students with them, so that our students can benefit from their in-depth insight and experiences that is not frequently publicised.
d. Four. We should encourage the teaching of ASEAN knowledge. By that I mean getting our tertiary institutes to teach ASEAN languages, business culture, and political culture, and through both formal courses and guest speaker series.
i. Singapore has deep expertise in the region through many excellent institutions, such as LKY School of Public Policy, RSIS, ACI, and ISEAS. Multilateral institutions such as World Bank, also have deep presence here.
ii. Our leading bankers, lawyers, and management consultants have tremendous experience working in ASEAN.
iii. We can tap on these institutions and our experts to open up course and talks to our students and entrepreneurs.
e. Five. Create an annual BusinessASEAN conference, much like the excellent BusinessChina Conference, which will put an annual spotlight on the exciting developments within ASEAN.
11. The end goal of all of this is to get our people to think ASEAN. If we can use our year ASEAN chair to start this mind-set shift, the opportunities for Singapore and Singaporeans will naturally follow.
12. With that, Mr. Speaker, I support the budget. Thank you.