During lunch with Alvin (Karloff), we have an interesting discussion about the future of SME in Singapore.
From the macroeconomic perspective, one MNC probably creates more jobs and output (GDP) then 100 SMEs. Hence, logically, it makes more sense trying to get MNC to based in Singapore. And by some economists estimate, we probably need about 4 MNCs in Singapore moving forward.
So why are we wasting time & money promoting entrepreneurship & helping SME?
Well, the old strategy of giving incentives to oversea MNCs to based in Singapore is not working anymore. For one thing, the opening of India & China and the fact that these countries have more talents at low cost means that even without any incentives from these governments, they are more attractive then Singapore.
Hence, if we cant find MNC overseas, then hopefully we can create a few in Singapore. And all MNCs started their life as a tiny little SME.
So yes, we need to continue to help our SME. It is also likely many of these SME will not make it…but all Singapore need is one or two to make it big. And if we have four, it would be a homerun.
ps: Helping does not means we should throw money at them to keep them afloat. If they are not able to survive on their own, it probably means they should die. Survival of the fittest.
