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1.46 Fourthly, we must promote manufacturing
and services as twin engines of growth. Manufacturing
will remain a mainstay of our economy. Our strong
manufacturing base generates 80% of our exports,
sustains many domestic support industries and
provides good jobs for Singaporeans. We must continue
to strengthen and upgrade this key economic sector.
1.47 Other countries too are relying on manufacturing
to spur their economic development. Competition
is fierce, especially from emerging players like
China. They do not just rely on their low costs.
They are also upgrading their technical know-how,
and moving into higher value-added activities.
We have no choice but to upgrade our own manufacturing
technology, or else see our manufacturing sector
hollowed out.
1.48 To strengthen the manufacturing sector,
we must acquire new technologies and capabilities.
Research and development (R&D), coupled with
enhanced protection for intellectual property,
are critical elements. We must help Singaporeans
to continually improve their skills and acquire
new ones in order to push our manufacturing sector
further up the value chain.
1.49 To diversify our economy, we must complement
manufacturing with a robust services sector. Services
already make up about two-thirds of our GDP and
overall employment. However we must promote our
services sector more actively. Exportable services
offer good growth potential, because the growing
middle classes in China and India will demand
many services which we can provide.
1.50 We are already a key hub for seaport and
airport services, logistics, trading, info-communications
technology, financial services and tourism. We
will continue to invest in these areas and use
our strong position to meet the competition from
other countries. At the same time, we will grow
new services industries like healthcare, education
and the creative industries.
1.51 Even in the services sector, the trend
worldwide is to outsource semi-skilled jobs to
countries with cheap and abundant labour. Many
US MNCs have outsourced their back-end call centre
operations to the Philippines and India, lured
by low wages and an ample supply of English-speakers.
Part of the training for call operators is to
watch American TV serials, so that they can discuss
the latest episodes in the proper American accents,
and make the callers think they are talking to
people in the US. So in services, as in manufacturing,
we need to upgrade our workers’ skills for
higher-value jobs, and train enough workers in
the skills that these new services industries
need. Ultimately, our human capital drives our
competitiveness.
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