Budget 2017 helps SMEs go digital

Singapore has enjoyed stable economic growth for the past several years.

However- this growth is not a given. Singapore faces several challenges- such as uncertain global economic conditions- the rise of regional competition- and an ageing workforce. As such- we now face a slowing pace of growth.

Given these challenges- the recently released Committee on the Future Economy (CFE) report emphasised the need for Singaporean companies including small and medium enterprises (SMEs) to ramp up innovation- acquire deep skills and scale up to meet global competition. A*STAR has launched several initiatives to encourage SMES to adopt the latest technology and innovate- in line with CFE’s recommendations.

One of these is the Tech Access initiative- through which SMEs can gain access to a wide range of specialised research equipment- user training and advice from technology experts in various industries. Participating companies can then decide to scale and acquire the equipment to capture new business opportunities.

A*STAR has also spearheaded the Operation and Technology Road-Mapping (OTR) programme- where trained facilitators help local companies develop a customised technology strategy and bring their research and development (R&D) projects to fruition.

Over 240 companies have successfully tapped the programme- and A*STAR recently announced new measures to scale up the programme and build its capacity to support 400 companies over the next four years. It will be partnering with trade associations and chambers such as the Singapore Manufacturing Federation and Singapore Precision Engineering and Technology Association to grow its network of trained facilitators.

The CFE report also recommended IP commercialisation via private sector involvement- more research and development (R&D) initiatives in industrial and commercial contexts- and simplified IP licensing plans to encourage collaboration between the public and private sectors.

To provide SMEs the advantage of exclusivity while they translate R&D outcomes into commercially relevant products and services- A*STAR has enhanced its Headstart programme. Under the revamped Headstart programme- local SMEs can enjoy royalty-free and exclusive licences for up to 36 months on industry solutions co-developed with A*STAR.

More SME-friendly schemes were also introduced during the 2017 Budget. For example- 70 per cent of the S$600 million funding allocated to the Wage Credit Scheme will be allocated to SMEs- while the maximum cap for the corporate income tax rebate has been increased to S$25-000 from S$20-000 in 2016.

The role of technology in shaping market forces is ever more profound- and companies need to innovate to stay afloat. With SME-friendly initiatives being introduced and implemented into the marketplace- Singaporean SMEs now have the springboard to leap into the digital age.