Speech by Mrs Lim Hwee Hua, Minister of State for Ministry of Finance and Transport at ''The Essentials for Business Seminar'', 2 August 200502 Aug 2005
Distinguished guests, Ladies and gentlemen
I am pleased to join you for the inaugural seminar organized by ACRA on the "Essentials for Business".
Partnership between Government and Businesses
2. To succeed, the businessman needs a business-friendly environment, the relevant skills, knowledge and instincts, and a dose of good fortune ? which may be large in some cases and small in others. The Government is committed to helping entrepreneurs succeed by maintaining a pro-business environment. Combined with the individual ability and effort of entrepreneurs, opportunities can take root and flourish. Let me speak a little today on the roles of the Government and business in this partnership.
Creating the best environment for business
3. The Government has, over the years, sought to create a conducive environment for business by putting in place various measures to help entrepreneurs start a business, obtain financing and source for business opportunities.
4. Starting a business. First, to help entrepreneurs start up, ACRA made it possible to register a company or a business not in terms of days but in terms of hours or minutes. The fee for incorporating a company has gone down from a sliding rate starting from $1200 to a fixed rate of $300, while that for registering a business has gone down from $100 to $50. The Companies Act was amended last year to make it possible for anyone to set up a company on his own, without having to find another director.
5. MOF recently introduced a new business structure known as the limited liability partnerships (LLP). This gives businessmen another option in setting up their business, in addition to the traditional sole proprietorship, general partnership and limited liability company. The LLP can be particularly useful for budding entrepreneurs as it provides limited liability while retaining the flexibility of partnerships.
6. For small and medium enterprises (SMEs), SPRING has its SME First Stop, which strives to help SMEs identify areas for business improvement, and match their needs to the appropriate programmes.
7. Financing your business. Financing and cashflow are often a problem for new businesses. To help budding enterprises, there are several financing schemes such as the Enterprise Investment Incentive Scheme under SPRING, and the Start-up Enterprise Development Scheme or SEEDS by EDB. To facilitate external capital raising, the Companies Act was amended last year to allow private companies to conduct public offerings without having to convert to public companies. To help companies with their cashflow, MOF announced earlier this year a one-year loss carry back facility. Under this arrangement, a company suffering losses can be partially refunded the taxes it paid in the previous year to alleviate its cashflow.
8. Access to business opportunities. Access to business opportunities can also be an issue for new businesses without an established record. To help businesses, the Government did away with the track record requirement at the end of last year. Today, new businesses can pre-register with MOF and bid for government tenders.
Educating businesses on the regulatory environment
9. The second key thrust in the Government's efforts is to equip the business community with information on the regulatory issues involved in running a business. This seminar is an example of the public education seminars that ACRA has started conducting, in collaboration with organisations such as the Law Society of Singapore and Enterprise Promotion Centres Pte Ltd.
10. Since its inception, ACRA has also made an active effort to increase public awareness of regulations by publishing regular practice directions and quarterly issues of legal digest. The aim is to educate and update professionals and the business community on legal reforms, and new policy initiatives.
Role of Businesses
11. The Government will do what it can to create a `Best for Business' environment. However, the success of the particular business depends ultimately on the businessman's own vision, drive, capability and resourcefulness. Nothing can substitute for business acumen and instincts, but you can position yourself better by building up your knowledge and reputation. For this, I make two suggestions for your consideration.
Invest in your capability
12. First, build up your capabilities and know-how. Know your environment and how it works. Just as a fruit farmer needs to know which fruits thrive in different soils and weather, an entrepreneur must understand the market and its regulatory environment.
13. Learn about the market ? what works and what does not ? and how to run businesses efficiently. There are countless books and tools for this. But business instincts are ultimately honed through keen observation, sharp ears and an inquisitive mind?and, yes, there is no substitute for learning from experience. There is more than a grain of truth in the story about someone asking a successful businessman, "How do you avoid making mistakes?". He replies, "Experience". "And how do you gain experience?" The boss replies, "By making mistakes."
14. Businesses should also put in time and effort to know the regulations involved in running a business, and the various programmes the Government has put in place to help businesses. You should not unwittingly be breaking the law. And it is good that you are using opportunities like this seminar to build up your knowledge. I urge businesses and the public to keep suggesting to ACRA and other public agencies how they can improve and expand on their public education efforts.
Invest in your credibility
15. Next, a successful business must be one that is credible and trusted by its partners, investors and customers. Integrity adds value to a business. Once lost, it takes a lot of time and effort to regain it. One thing businesses can do to enhance their credibility is to adopt best practices in corporate governance and disclosure. While the Code of Corporate Governance is targeted at listed companies, other companies and businesses should adopt the spirit behind the Code, even if they do not adopt the Code itself. Fundamentally, the spirit is about accountability, transparency and honesty.
17. The Government wants, as much as you, to see local enterprises thrive and prosper. Each should do its part. The Government will help with a favourable regulatory environment, assistance for start-ups, public education programmes, and a listening ear. You can help yourself by building up your knowledge and experience, credibility and reputation.
18. I wish you a most interesting and fruitful seminar.