and implementation of its industrial policy initiatives and in particular the sectoral policy interventions – productivity roadmaps between 2010 and 2014 and industry transformation maps since 2016. It is interesting to note the change of the composition and structure of cooperation bodies. In terms of composition it started with more limited representation with up to 2 representatives from unions and employers’ side and a small selection of companies, with an over-representation of construction, infrastructure and heavy manufacturing sectors, moving later to extend the size of the membership and include more representatives from advanced manufacturing, business and personal services sectors. The complexity of the coordination framework also increased substantially, especially since 2017 with the launch of FEC which includes not only national, but also cluster-level and sector-level coordination bodies.
3.6. The status of industrial, skills, innovation and trade policies As discussed earlier in the report, a number of different policy areas have (sometimes a substantial) influence on industrial performance and modernisation. With the reference to earlier mentioned approach to classify industrial policy interventions using the growth accounting framework, major policy areas that could be distinguish are those regulating product markets (notably competition policy, exchange rate policy), capital market (notably fiscal and monetary policy), labour markets (education, training and labour market policies), technology markets (intellectual property, research and innovation) and other. In this analysis it is not possible to review the context of all the relevant policy fields in Singapore, however it is worthwhile to look into those fields that have stronger links to the Industry Transformation Programme, which, as analysed in more detail below, focus on four key pillars: productivity, skills, innovation and trade. 3.6.1.Productivity promotion Singapore has a long tradition in pursuing efforts to promote productivity growth. The early efforts can be traced to the first years of independence, with the set-up first of a “productivity unit” under the purview of the EDB was set-up in 1964, promoting it to a national productivity centre in 1967 and finally setting-up a dedicated national productivity board in 1972 1. As already mentioned in a concise manner in previous chapters, there has been at least two major efforts that were notable in public communication – the productivity promotion effort in early-1980s, with the effort to curb the growth of immigrant labour and increase productivity of local enterprises, that later coincided with (but also likely made it worse) the first post-independence recession of 1985 that forced the government to promptly reverse prior decisions to increase labour costs and introduce immigrant labour quotas (Auyong, 2016). The second more notable episode appeared in 1994 with the publication of the article in Foreign Affairs by the notable economist P. Krugman (who later was awarded a Nobel prize in economics) highlighting the lack of productivity growth in East Asian economies, notably Singapore (Krugman, P., 1994). In this article it was argued that growth in East Asian economies were driven primarily by factor accumulation, similar like in the Communist countries, without corresponding increase in productivity and innovation, therefore due to diminishing returns of such input accumulation being not a sustainable growth path in the long term. The government of Singapore, while dismissing the critique, 1
http://eresources.nlb.gov.sg/history/events/1322f7a8-b6d8-4d0f-89cb-0c712119b7a5, accessed 2018.01.20
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