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The 1980s |
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The 1980s: The era of knowledge-intensive industries
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The 80s saw Singapore embark on what the government called the "Second Industrial Revolution", a move into knowledge-intensive activities such as R&D, engineering design, and computer software services.
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In his 1981 Budget speech, the then Minister of Trade and Industry, Mr Goh Chok Tong, said, "The prime objective of the plan is to develop Singapore into a modern industrial economy based on science, technology, skills and knowledge."
To meet the specialised manpower needs of high-technology industries, EDB established institutions of technology jointly with the governments of Japan, Germany and France. These trained Singaporeans for specialised jobs in electronics and engineering. EDB also took on the task of administering the Skills Development Fund to encourage the right kind of manpower training.
The Science Park was set up next to the National University of Singapore to stimulate R&D activities by the private sector. Low-cost financing and technical consultancy under the government's Robot Leasing Scheme helped manufacturers automate their operations.
The government adopted a high wage policy to accelerate the move away from labour-intensive industries and the attraction to high-technology industries. But wage bills swelled as the world slipped into an economic slowdown, and Singapore slid into a recession.
An Economic Committee led by the then Minister for Trade and Industry, Mr Lee Hsien Loong, took a long hard look at what was needed to restore Singapore's competitiveness. The Committee's most far-reaching recommendation was the introduction of a flexi-wage system where pay hikes would be relative to a company's profitability.
Another call the Committee made was for EDB to promote all aspects of economic activity. With the new goal of selling Singapore as a Total Business Centre, EDB set out to attract international service corporations in the financial, educational, lifestyle, medical, IT and software sectors.
The economy was to be supported by twin engines of growth: manufacturing and services. The promotion of local enterprises also became increasingly important. EDB set up the Small Enterprise Bureau in 1986 and shaped a range of assistance schemes to help small local enterprises grow.
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