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MTI details comprehensive support for SMEs

By Wong Wei Han

By Wong Wei Han

SINGAPORE--Small and medium enterprises (SMEs) can expect greater support to help them recruit talented local staff, access global opportunities and improve productivity as a result of the detailed measures unveiled by the Ministry of Trade and Industry (MTI) to help businesses flourish during the process of economic restructuring.

The plans were fleshed out yesterday by various Ministers during MTI’s Committee of Supply Debate.

One of the key new measures is the SME Talent Programme, designed to help businesses source high-quality local employees from the Polytechnics and Institutes of Technical Educational. Participating SMEs will receive up to 70 per cent funding support covering tuition fees and monthly allowances for students, who will then be bonded to the sponsoring company for two years after graduation. The programme aims to match over 3,000 students with SMEs over five years.

SMEs will also receive be able to tap the Market Readiness Assistance (MRA) grant to help them expand overseas, said Senior Minister of State for Trade and Industry Lee Yi Shyan.

“International Enterprise Singapore will co-fund up to 50 per cent of eligible costs associated with foreign market assessment and market entry, including legal advice, tax advisory and consultancy services, up to a maximum of $20,000 per company per year,” said Mr Lee.

Meanwhile, Minister of State for Trade and Industry Teo Ser Luck announced the Collaborative Industry Projects (CIPs), targeting six priority sectors such as food manufacturing, furniture and retail. Under this initiative, a consortium formed by at least three SMEs can receive up to 70 per cent funding support for projects aimed at improving productivity.

Similar initiatives have already yielded results, with businesses coming together to get funding from the Infocomm Development Authority, said Mr Teo.

“(With the funding) Bugis Street Development implemented an integrated Point of Sale, Inventory Control and Cashless Payment system for 800 retail shops at Bugis Street. This allowed the retailers to decrease the cost of technology adoption.”

During the debate, Mr Teo also addressed MPs’ concerns about the accessibility of government support schemes.

He said that to help ensure that initiatives reach their intended target, the various financial support schemes offered by SPRING have been consolidated into one main grant, and the bureaucratic process of applying for help has been simplified.

Another initiative will be the enhancement of the existing Partnerships for Capability Transformation scheme, which encourages SMEs’ to work in partnership with large enterprises for productivity upgrading.

As more details emerged about the Government’s assistance programmes, the business community had mixed reactions.

Sterling Engineering’s business development manager Marc Sim welcomed the SME Talent programme, which should help the steel construction company in its search for quality local employees.

“But there are still a lot of SMEs which simply don’t have the financial capability to expand abroad yet, despite the MRA programme,” he said.

Wafflicious Café’s owner Darren Lee thinks it is premature to judge the success of the schemes.

“I think there is still not enough help for micro-SMEs, with most schemes more applicable to mid- and large-scale SMEs, and I hope there can be more targeted schemes for us.”

Singapore Business Federation’s chief operating officer Victor Tay is particularly upbeat about the “limitless possibilities” of the CIPs. “With this platform to catalyze consortium formation, businesses will band together to leverage on innovative solutions and technologies that companies couldn’t access individually without scale.”

But as most of the initiatives are co-funding schemes, Mr Tay believes their effectiveness may be of limited value for smaller, cash-strapped SMEs that cannot commit to initial investments.

“Overall, this year’s business-related budget has been described as somewhat Darwinian – a process where some businesses may not survive. I don’t necessarily disagree,” said Mr Tay.

The issues faced by SMEs were highlighted by Minister Lim Hng Kiang as he responded to MP Tan Su Shan’s queries.

“Indeed, we recognize that SMEs will face more difficulties coping with these changes. The government is committed to help SMEs through this difficult transition period, and many of the assistance measures introduced this year have been weighted to benefit SMEs more. This was done consciously and deliberately because we want to help them,” said Mr Lim.

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