Economic Opportunities

Charting our next phase of economic growth

Our Singapore Economy 2030 vision charts our next phase of growth towards a vibrant and resilient economy with opportunities for all. It aims to establish Singapore as a global hub for advanced manufacturing, business and tourism, enhance our global economic connectivity, and build a vibrant ecosystem of future-ready enterprises.

To achieve this vision, we pursued four key approaches: Grow, Unlock, Transform, and Connect.

Growing our economy (“Grow”)

Seizing opportunities in Manufacturing, Services and Trade

Our Manufacturing sector has achieved good progress towards our Manufacturing 2030 goal of increasing the sector’s value-add by 50% in the next decade.

• Despite economic headwinds, manufacturing value-added increased by almost 20% from 2019 to 2023, while total employment in 2023 recovered to around pre-COVID-19 pandemic levels in 2019.

• Singapore remains well-positioned to capture growth opportunities and attract investments from industry leaders.

Feature Story: Siltronic’s new 300mm silicon wafer manufacturing facility in Singapore

In June 2024, Germany’s Siltronic opened its new 300mm silicon wafer manufacturing facility at Tampines Wafer Fab Park. The new facility represents the largest investment in Siltronic’s history, with $3 billion invested as at end-2024. The wafers manufactured will be used to support complex applications such as high- performance computing and high-speed mobile processors.

This investment is expected to create 600 new jobs by 2028.

To enhance Singapore’s attractiveness for investments, we sharpened our investment promotion toolkit to support high-value and substantive economic activities:

• Extended the Pioneer Certificate, Development and Expansion Incentive, and Investment Allowance tax incentives [PDF, 721 KB] up till 2028.

• Further topped up $6 billion to the National Productivity Fund in 2023 and 2024, with its scope expanded to support investment promotion.

• Introduced the Refundable Investment Credit scheme in 2024.

Read more: Economy and Labour Market | Business Environment

Our diverse Services sector similarly made progress towards our Service 2030 goal.

• Between 2019 and 2023, the Modern Services cluster’s value-added expanded by about 20% and employment increased by 85,000.

• Singapore’s connectivity and favourable location attracted significant Headquarters and Professional Services projects from businesses keen to access growth opportunities in Asia, especially in the Information and Communications Technology sector. These projects comprised 67% of total business expenditure ($6 billion out of $9 billion) secured in 2023 and are expected to create over 10,000 jobs when completed over the next five years.

• Our tourism sector showed strong recovery from the COVID-19 pandemic. In 2023, we welcomed 13.6 million international visitors and generated $27.2 billion in tourism receipts, marking an almost full recovery to the performance in 2019. We rejuvenated and refreshed local experiences and offerings, including attractions such as the Bird Paradise in Mandai. The strong performance was also bolstered by the Taylor Swift and Coldplay concerts in 2024, and blockbuster events such as Formula One Singapore Airlines Singapore Grand Prix. Our Meetings, Incentives, Conventions, and Exhibitions industry performed well as Singapore continued to host prominent global conferences and exhibitions such as the Asia Tech x Singapore and Gastech.

We made good progress towards our Trade 2030 goal, which aims to deepen and widen trade, to embed Singapore more deeply in global supply chains.

• We are home to about 400 global traders, trading in all major classes of commodities from agri-commodities to metals and energy products. These companies continued to grow their business in Singapore. For example, European energy trading company Vitol set up its carbon trading desk in Singapore in the first half of 2022 and recently consolidated its global shipping activities in Singapore.

• Increasingly, global traders are choosing to deepen key activities in digitalisation, innovation and sustainability in Singapore. For example, Norwegian crop nutrition giant Yara opened its innovation hub in Singapore in May 2024 to pioneer solutions to address food security challenges in Asia and Africa.

• In 2023, these global traders generated about $50 billion in local business spending and created 16,000 jobs, while helping our local companies scale and access new markets. For example, in 2022, Singapore businesses Teo Garments and Browzwear were better able to access the European market through their partnership with Lidl & Kaufland Asia, a food and retail industry leader in Europe.

Doubling down on key growth sectors and new growth opportunities

To better position Singapore for future growth, we sought to establish our competitive edge early in key growth areas, including artificial intelligence (AI) and Sustainability.

Artificial intelligence

• We launched the first National AI Strategy in 2019 [PDF, 9 MB] and refreshed it in 2023 (NAIS 2.0) [PDF, 6.1 MB] to further harness AI's transformative potential for our people, businesses, and economy.

• To strengthen the competitiveness of key economic sectors, we established our first sectoral Centre of Excellence (CoE) to tackle sector-wide use cases and build domain-specific capabilities.

Feature Story: Sectoral AI CoE

The Government has been working with industry to set up sectoral-based CoEs to address sector-wide use cases and build domain-specific capabilities in key economic sectors.

One example is the AI in Manufacturing CoE (AIMfg), launched in September 2024.

The AIMfg has worked with industry partners to enhance the manufacturing value chain (in areas like quality assurance and predictive maintenance) through the use of technologies such as Generative AI and Machine Learning.

As of the launch, at least 10 companies have signed agreements to co-innovate with the AIMfg.

Sustainability

• To seize new opportunities in emerging green growth sectors, we have built up our carbon trading and services ecosystem to serve regional and international markets. Leading companies such as The Nature Conservancy and South Pole established their regional headquarters in Singapore, and local traders like Agrocorp set up new carbon trading and origination functions in Singapore.

• To ensure that Singapore has sufficient talent to support the growth in carbon services and trading, we qualified carbon-related roles such as “carbon trader” under MOM’s Shortage Occupation List [PDF, 123 KB].

• We built on the foundations of Singapore’s Energy and Chemicals sector to diversify into and capture the rising demand for greener fuels and chemicals.

• Starting April 2023, Singapore has been home to the world’s biggest renewable diesel refinery, capable of producing 1 million tonnes of sustainable aviation fuel, per year.

Supported the growth of our enterprises

In line with our Enterprise 2030 vision, we sustained a vibrant ecosystem for our enterprises to thrive and scale internationally.

• In 2023, more than 18,000 enterprises were supported in growing their revenue and cost-competitiveness. Of these, 3,000 enterprises embarked on transformative projects which are expected to boost their annual revenue by $16.4 billion and create 21,500 skilled jobs. In addition, 15,000 companies were supported in their capability development and market exploration projects to establish their growth on the local and global stage.

• Since 2010, the Government has set aside $150 million to support the Partnerships for Capability Transformation (PACT) [PDF, 152 KB] scheme, which has benefitted more than 2,500 Singapore-based firms as at Q1 2024. We aim to facilitate 100 new PACT partnerships over the next five years to provide opportunities for small and medium enterprises (SMEs) to level up capabilities and access global and regional value chains for internationalisation and corporate venturing.

Read more: Economy and Labour Market | Business Environment

Unlocking our resource potential (“Unlock”)

To overcome domestic resource constraints, we optimised our scarce resources and invested in alternatives.

Energy

To achieve our net-zero ambitions by 2050, we continued to invest in clean energy sources, such as solar power and pursue all viable decarbonisation pathways, while maintaining energy security and ensuring cost-competitiveness.

We have also continued to explore alternative sources of low-carbon energy while balancing sustainability, security, and cost-competitiveness.

• In 2024, we commenced a nationwide non-invasive geophysical study to assess Singapore’s deep geothermal resource potential for power generation.

• Although we have not made a decision on nuclear energy, we signed a civil nuclear cooperation agreement with the United States in July 2024 that supports our efforts to understand advanced nuclear energy technologies, should viable options emerge.

Read more: Environment and Sustainability

Land

We rejuvenated our industrial estates and infrastructure in a smart and sustainable manner to maximise the productive use of land. This included building innovation and ecosystem-centred hubs, where the full value chain of activities would be within easy reach for businesses. Through the rejuvenation, businesses would be able to access a more vibrant and greener work environment with improved connectivity.

Feature Story: Thriving Industrial Districts

With the new Jurong Innovation District (JID) serving as Singapore’s next-generation advanced manufacturing hub, prospective businesses can plug into a thriving ecosystem of over 100 industry players across the full manufacturing value chain. Businesses can also look forward to more efficient transportation of goods and cargo, with a first-of-its-kind Underground District Logistics Network embedded within the district. There is also a car-free Sky Corridor linked to green connectors, where people can enjoy walks and cycle.

When completed, the investments anchored within JID are expected to create about 95,000 jobs in advanced manufacturing and innovation.

Similarly, the Punggol Digital District (PDD), opening in phases from Q3 2024, will be Singapore’s first smart and sustainable business district. The investments anchored within PDD are expected to create 28,000 jobs in key growing technology sectors such as cybersecurity, fintech, robotics, AI, and smart living. It also houses the Singapore Institute of Technology, bringing industry and academia together through shared spaces and facilities.

PDD will be conveniently accessible with the upcoming Punggol Coast MRT station, bus interchange, and new bus stops. Vehicular access roads and other service driveways within PDD will also be located underground to reduce vehicular traffic.

Transforming our businesses (“Transform”)

The Government has supported businesses in upgrading and transforming for greater productivity and adapting to changing consumer preferences. Specifically, demand from businesses for digital services remained strong as they increasingly leverage these productivity-boosting solutions.

• We supported the revitalisation and transformation of heartland enterprises to leverage technology to adapt to changing consumer preferences. As at Q2 2024, more than nine in 10 (over 17,000) heartland shops have adopted e-payment solutions, while about two-thirds of shops (over 12,000) have had an online presence.

• In 2024, 15 enterprises were supported in their transformation efforts through the inaugural run of the Heartland Innovation and Transformation (HIT) Programme, which offers curated training, networking opportunities, and access to spaces for testing and scaling ideas.

Feature Story: Adding vibrancy to our heartlands

Project Enigma is known for its innovative puzzles and toys to designed to improve people’s learning and well-being. Under the HIT Programme, Project Enigma set up a pop-up kiosk, to showcase its edutainment offerings and workshops to customers.

Through this and networking opportunities, Project Enigma gathered market sentiments on its product and services, as well as developed collaboration opportunities with corporate partners and other participants in the HIT programme. Project Enigma has since scaled up to introduce a puzzle museum and library at Henderson Community Club and is running community workshops.

We supported businesses in the green transition to decarbonise and improve energy efficiency, to remain competitive in a low-carbon economy. These efforts better position businesses to capture new growth opportunities.

• Through the Enterprise Sustainability Programme (ESP), SMEs were supported in all stages of their sustainability capability development. As at end-2023, close to $350 million in green loans have been catalysed under the Enterprise Financing Scheme - Green, and about 1,500 businesses have benefitted from the ESP, which provided an estimated $14 million in funding support for capability building courses, programmes and grants.

• Across all support schemes available since 2019, the manufacturing and data centre sectors have collectively reduced emissions by more than 1 million tonnes of carbon dioxide equivalent (akin to about 2.7 million cars taken off the road every year). One scheme example is the Resource Efficiency Grant for Emissions which supports large enterprises to improve their facilities’ energy efficiency and adopt emissions reduction effort. This includes switching from carbon intensive energy sources or process gases with higher global warming potential.

Connecting to capture growth opportunities (“Connect”)

Singapore’s network of 27 Free Trade Agreements (FTAs) is testament to our strong economic ties with markets around the world. These FTAs have allowed companies access to global markets by lowering tariff and non-tariff barriers for Singapore’s goods, reducing restrictions for our services sectors, and enhancing protection for investments. They have also improved efficiency and helped reduce business costs of trade with Singapore’s FTA partners.

To help companies use these FTAs, we worked closely with the Singapore Business Federation to conduct outreach and provide customised advisory support for Singapore companies that require assistance in tapping FTAs for exports and internationalisation. In 2023, more than 1,600 companies benefitted from such outreach efforts.

We diversified our partnerships worldwide, tapping on opportunities in Southeast Asia, the Middle East, Latin America and beyond. For example:

• Singapore and Malaysia are working towards an Agreement on the Johor-Singapore Special Economic Zone [PDF, 150 KB]. This will facilitate the cross-border flow of goods and movement of people and strengthen the overall value proposition of the Singapore-Johor Region to better compete for global investments together.

• Singapore and India are stepping up bilateral cooperation through the India-Singapore Ministerial Roundtable held in August 2024, in areas such as advanced manufacturing, trade and investment, digitalisation, the green economy and skills development.

• We signed several agreements with Saudi Arabia and the United Arab Emirates in October 2023, including Memorandum of Understandings on recognition of halal certifications. This will benefit local businesses seeking to export halal food products to both countries.

• In December 2023, Singapore signed the MERCOSUR-Singapore FTA. When ratified, this will facilitate greater trade flows with South America and business opportunities in infrastructure development, agrifood trade, oil and gas, and advanced manufacturing.
  

To complement our FTAs, we have made strides in pioneering new agreements in the digital economy and green economy.

• As at October 2024, we have four Digital Economy Agreements (DEAs). Our DEAs have supported the growth of Singapore’s digital economy by easing cross-border data flows and enhancing interoperability between governance frameworks to support businesses engaging in digital trade and electronic commerce in overseas markets. Our digital economy has grown from a gross merchandise value of US$12 billion in 2019 to US$22 billion in 2023, and is projected to grow further to US$29 billion in 2025.

• We also developed Green Economy Agreements (GEAs) to support emissions reduction while spurring economic growth and job creation in the green economy. For example, our GEA with Australia has catalysed collaborations in scientific research, green shipping corridors, and co-innovation programmes for SMEs. We also signed the Clean Economy agreement under the Indo-Pacific Economic Framework for Prosperity (IPEF). The IPEF Clean Economy Investor Forum, held in Singapore in June 2024, was a tangible outcome of this regional cooperation and demonstrated our commitment to tackle climate change.

Singapore also has an extensive network of 93 comprehensive Avoidance of Double Taxation Agreements as at October 2024. These agreements help promote bilateral trade and investments, by lowering tax barriers on certain types of cross-border income and providing greater certainty for Singapore companies operating in these markets.

Seizing opportunities ahead

To seize opportunities and fuel our next bound of growth, we must continue to push for higher value-added growth, double down on established and new growth sectors, maintain a strong core of local enterprises, and connect with our region and beyond.

At the same time, we must unlock our resource potential to broaden our growth pathways and transform for greater productivity gains and value-add.

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