30.

To meet these competitive challenges, the Committee on Singapore's Competitiveness (CSC) has mapped out a comprehensive set of long term economic strategies. These strategies have been adopted by the Government as the blueprint for developing Singapore into an advanced and globally competitive knowledge-based economy within this decade. The Government is actively pursuing these strategies, which address both the hardware and software aspects of our competitiveness.

31.

In hardware, Singapore already has a competitive edge. We have invested heavily in many key economic and business infrastructure and international surveys have consistently ranked us highly on infrastructure, citing our world-class sea and air ports, modern telecommunications facilities, and advanced IT infrastructure. Private sector investments have also been strong.

32.

Some observers and analysts have commented that Singapore has over-invested and become inefficient in our use of capital. MTI has studied this in detail and has found that this is untrue. Except for the period in mid-80s, our investment rates are not disproportionately high compared to the regional Incremental Capital Output Ratio (ICOR), a measure of the additional unit of capital required to produce each additional unit of output, also show that we have not been using capital inefficiently. MTI will be releasing details of its findings in due course.

33.

Physical infrastructure, however, can be easily replicated. In fact, latecomers can often leapfrog ahead using state-of-the-art technology. The challenge is for Singapore to differentiate ourselves by finding creative ways to add value to our infrastructure.

34.

The Jurong Island project is one such example. Amalgamated from 7 offshore islands, Jurong Island aims to become a world-class integrated chemical hub, the first of its kind in the region. Through clustering and the sharing of common facilities, it will generate significant synergistic linkages across a wide spectrum of petrochemical industries. For example, the provision of centralised logistics and common corridors for material flows will significantly reduce feedstock transportation and handling cost. With the recent launch of the JurongIsland.com internet portal, companies on the island can now be easily linked up with one another on the island, and with Government agencies on the mainland. When the masterplan to dot-com Jurong Island is fully completed, companies on Jurong Island will be able to conduct business electronically and reduce product cycle time and costs. Jurong Island will truly be an intelligent island.

35.

On the software aspect of our competitiveness, the quality of our people will be key. The New Economy is about exploiting knowledge as the source of competitive advantage. As a small country, every Singaporean matters. The key is for everyone to consciously improve their skills and look for new ways to do the job better. The more well trained and educated our workforce, the better our chances are in achieving this goal.

36.

Currently, about 65 per cent of our yearly cohort of students enter universities and polytechnics - a First World standard. However, if we look at the total stock of our workforce, less than half of Singaporeans above the age of 40 have secondary and higher education. We need to level up this group of workers, numbering some 834,000 or 42 per cent of our workforce, through training and retraining to help them cope with the new economy. A key priority of the Government will therefore be manpower training. The Ministry of Manpower will press ahead with its various initiatives under the Manpower 21 programme to upgrade the skill level of our people.

37.

However, training our indigenous workforce alone will not be enough. Even with a highly educated workforce, our small population size would limit the talent pool in Singapore. We will need to augment both the quantity and quality of our workforce by actively attracting foreign talent. In the knowledge age, top talents make a big difference and contribute disproportionately to the economy. With a larger pool of talent, we can enlarge our economic pie, create more jobs and bring higher wages for all.

38.

However, training our indigenous workforce alone will not be enough. Even with a highly educated workforce, our small population size would limit the talent pool in Singapore. We will need to augment both the quantity and quality of our workforce by actively attracting foreign talent. In the knowledge age, top talents make a big difference and contribute disproportionately to the economy. With a larger pool of talent, we can enlarge our economic pie, create more jobs and bring higher wages for all.