TL;DR

Who: Singapore, trade war and National Wages Council

Weekly Business Brief | 2019 Week 22

Wrapping up the week's business news and announcements.

SBO Singapore Weekly Business Brief
Published:   |   Updated:   |   Posted in

Singapore overtakes US, Hong Kong to be world’s most competitive economy

Singapore’s return to the top spot… was due to an advanced technological infrastructure, the availability of skilled labour, favourable immigration laws and efficient ways to set up new businesses…

Singapore is the world’s most competitive economy in a yearly ranking of 63 economies released on Wednesday (May 29) by Switzerland-based research group IMD World Competitiveness Centre.

Singapore’s return to the top spot – its first time since 2010 – was due to an advanced technological infrastructure, the availability of skilled labour, favourable immigration laws and efficient ways to set up new businesses, the report said.

Out of the four key categories that were assessed, Singapore made it to the top five for three of them, namely economic performance (5th), government efficiency (3rd) and business efficiency (5th). For the final category of infrastructure, it was ranked sixth.

Hong Kong – the only other Asian economy in the overall top 10 – held on to the second spot due to a benign tax and business policy environment, as well as access to business finance.

The United States, which was last year’s leader, slipped to the third position.

For this year’s ranking of 63 countries, ranked using 235 indicators, Asian economies “emerged as a beacon for competitiveness” with 11 out of 14 economies either moving up the charts or holding on to their positions, the report said.

Read more in this Channel NewsAsia report.

Singapore prepared for negative consequences of trade war: DPM Heng

Singapore must also ensure that its talent pool remains strong and are well exposed to developments in China and around the world.

Besides having monetary and fiscal policy to counter any cyclical downturn, he stressed that Singapore needs to ensure that its economic transformation takes place “at an even faster pace”.

“This is of utmost importance and we must focus our minds and our energies on this,” said Mr Heng. “I hope that corporate leaders in Singapore take this very seriously because this is also an opportunity for us to turn adversity into strength.”

“One strong characteristic of the Chinese system is that the political leaders, as well as the business leaders, think in (the) long term … as well as how they can scale these operations beyond just China,” said Mr Heng.

“That provides many areas for us to cooperate (in), for us to work together. In the same way, we must take a more strategic view of the future development and position ourselves well.”

This means Singapore companies have to step up their transformation, said Mr Heng, who noted that Chinese companies have grown significantly in their capabilities.

Singapore must also ensure that its talent pool remains strong and are well exposed to developments in China and around the world.

Read more in this Channel NewsAsia report.

National Wages Council suggests S$50-S$70 pay hike, one-off payment for low-wage workers

… [NWC] is also increasing the basic wage threshold for low-wage workers by S$100 to S$1,400.

The National Wages Council (NWC) on Thursday (May 30) recommended that low-wage workers receive a pay increase of S$50 to S$70 per month, with a further recommendation that employers which achieved productivity gains give employees a one-off payment.

At the same time, it is also increasing the basic wage threshold for low-wage workers by S$100 to S$1,400.

Explaining the need for the increase, it said: “The proportion of full-time resident employees earning a basic monthly wage of up to S$1,300 is estimated to have decreased from 9.2 per cent in 2017 to 7.9 per cent in 2018.”

As part of its latest recommendations, NWC also said that employers that achieved productivity gains in 2018 should provide a one-off payment of S$200 to S$360 to low-wage workers earning a basic monthly wage of up to S$1,400.

At the same time, employers could grant low-wage workers earning more than S$1,400 a “reasonable wage increase and/or a one-off lump sum based on skills and productivity”.

Read more in this Channel NewsAsia report.


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