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Restructuring process on track: MTI

SINGAPORE — Responding to TODAY’s queries, a Ministry of Trade and Industry (MTI) spokesperson stressed that the restructuring process is on the right track.

SINGAPORE — Responding to TODAY’s queries, a Ministry of Trade and Industry (MTI) spokesperson stressed that the restructuring process is on the right track.

“We have made steady progress in our economic restructuring. The Government has put in place several schemes to encourage businesses to improve process improvements and adopt technological innovations. However, it will take time for productivity gains to materialise,” he said, adding that some sectors have already experienced solid productivity growth in recent years.

Productivity in the precision engineering industry has been growing by 7.8 per cent annually since 2009, while food services sector has achieved 3.4 per cent annual improvement over the same period, MTI data shows.

And it appears that businesses are facing the reality of the challenge: Based on engagements with SMEs and through surveys, the MTI said that mindsets have changed.

“Many businesses have accepted the reality of a tight labour market and SMEs are increasingly taking up government schemes to improve their productivity. To date, more than 17,000 companies have benefited from the various productivity initiatives under the National Productivity and Continuing Education Council”, including the Productivity and Innovation Credit scheme, with its take-up rate improving from 33 per cent in 2011 to 40 per cent last year, the spokesperson said. “The Government has taken a calibrated approach to the tightening of foreign worker policies to reduce the impact on businesses. Companies have been given time to adjust as the foreign worker measures were announced in advance and progressively implemented,” he added.

“We remain confident that the economy will be able to restructure successfully over time to be more productivity-driven. This will ensure more efficient use of labour, which will not only help to relieve labour constraint, but also support higher wages without eroding the competitiveness of our economy.” WONG WEI HAN

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