Committee of Supply – Head V (Ministry of Trade and Industry)

Mr Chairman, before I begin, I declare my interest as the group managing director of Commonwealth Capital Group.

I have spoken in this House before about the importance of growing Singaporean multinational companies (MNCs) that are deeply rooted here. Ultimately, size matters. When a Singapore enterprise scales successfully, it anchors high value headquarter (HQ) functions here. It develops local managerial talent pipelines, and it contributes to economic and supply chain resilience. Singaporeans will benefit if we have more local companies crossing the $1 billion mark in annual revenues.

MTI could consider setting an ambitious target for a number of new local companies to reach that scale by 2035 so that all Government agencies can marshal their resources to achieve this.

While it remains important to help the broad base of small and medium enterprises (SMEs), as defined by those earning below $100 million of annual revenue, there are unique challenges for companies to scale beyond $100 million. At the $100 million-level, these companies are still small enterprises on the global stage.

MTI could consider adding a separate tier of companies between $100 and $200 million in annual revenue, with slightly lower support than the SME tier, so that there is a gentler cliff effect in support levels, which are typically more generous for SMEs. Today, the support levels can drop from 70% to 30%. I wonder if this is incentivising some companies to stay below the $100 million mark in annual revenues unnaturally.

This is similar to legislation passing through the European parliament last week on a new tier of small mid-cap companies. Coincidentally, this new tier was set at 200 million Euros.

Many of our larger local companies are already winners in their respective industries. They are capable and ambitious, yet few manage to break into the next tier. That is because unlike other countries, we do not have a large domestic market. So, to scale further, our firms have to internationalise when they are smaller while operating headquarters with a higher-cost base. This is a structural disadvantage and makes scaling much more difficult.

So, to be clear, when the Government supports larger local firms to scale, it is no longer about picking future winners. It is instead about doubling down on current winners, helping them win even bigger in the future and thereby bringing more benefits to Singaporeans.

To scale, firms must do two things.

First, firms must develop more products and services with market fit. The Government has no business in telling companies what to do or how to do it. That is the job of entrepreneurial enterprises. But the Government can create a conducive economic infrastructure to improve the chances of success.

MTI's efforts to sustain a dynamic and vibrant enterprise ecosystem will help. Such an ecosystem can foster broader, deeper and richer collaborations that lead to a faster cycle of product development and market testing.

We also need to consider whether our factors of production, taken holistically, are competitive. These include manpower, land, energy and capital, to name a few. I will focus only on capital today.

Firms need access to sufficiently affordable capital in order to invest in fixed assets, such as machines to increase output, as well as working capital, which can grow quite quickly as firms scale. To that end, I have no objections to the Budget announcement to improve the Enterprise Financing Scheme for trade and fixed asset loans.

But organic growth is way too slow. We should be more impatient and help firms get to the moon faster. Focus on inorganic growth through mergers and acquisitions (M&A) to turbocharge our local companies. Affordable capital is also required for M&A.

Currently, the Enterprise Financing Scheme supports domestic acquisitions undertaken by firms up to $500 million in revenue, but this support lapses in a month. This was not mentioned in the Budget Statement. The Ministry should consider extending or broadening this support.

Second, once firms have product-market fit, they need to scale through new markets. We can do this in a few ways.

We can bring those markets into Singapore through tourism. This speaks to our tourism strategy to bring more high-spending tourists who can revitalise traditionally domestic-oriented industries, like F&B and retail. More tourists also mean more GST collections.

Of course, the more conventional way is to go into new markets overseas. When our firms expand overseas, the biggest constraints are often networks, credibility and distribution channels. This has traditionally been Government-led, but strong business-led communities can complement Government efforts. They can engage regulators and partners in a more informal and commercially driven manner; facilitate peer-to-peer sharing of intelligence and experiences; and build a sustained Singapore-branded presence.

I sometimes wonder why there are not more Singaporean business chambers of commerce overseas. For example, there does not seem to be one in the United States (US) or the United Kingdom (UK). Is the Government aware of any coordination challenges preventing similar business-led platforms from forming? Does the Government see any value in playing a stronger catalytic role to address these challenges?

Mr Chairman, I hope the Ministry can consider these perspectives to strengthen our enterprise landscape. Singaporeans can look forward to a new generation of Singaporean global enterprises with pride.

Mr Chairman, I would like to declare that I have innovation studios which create and invest in technology and innovation ventures for the global market.

We are actually living in a very exciting time, with lots of disruptive innovations and technology. The question is how we in Singapore explore and exploit such opportunities.

If we look at the, let us say, air taxi market that I am involved in, you can see that there are, on NASDAC or NYSE, companies that are worth between about $8 billion and $16 billion in valuations, but they have not sold a single craft. They have pre-orders, but they have not actually sold a single craft. So, they are pre-commercialisation, but the market recognise the opportunities and fund them.

Do we have such an exchange in Singapore? I think that is the big question. For technology companies and especially new ventures, really, we need to find a different formula. If you look up north, a little bit further, in Hong Kong, they have the pre-commercialisation listing rules for biomedical under the listing 18A rules or the 18C rules, which is specialist technology companies.

We can learn a little bit from that, but they cater for a bigger market.

In Singapore, we have lots of startups, technology ventures resulting from the universities' research, and also from the Agency for Science, Technology and Research (A*STAR), from our research institutes. There are also a lot of AI innovation opportunities from the private sector. The question is always a gap, the gap between the people that are looking for money and the people looking for exit from the investment. So, they are all staring at each other. Who is going to move first? That is where the pre-commercialisation stage funding is required for all these technology ventures.

I would like to propose that we close this gap. That for technology ventures that are globally oriented and leadership driven, g-o-l-d, I will call it these gold nuggets that we have. And I believe we have a lot of gold nuggets. My doctorate is in innovation. I have trained a lot of innovative teams in the universities. So, how to bring these gold nuggets to become actually a big gold bar? I believe that our exchange can be structured for special listing rules for the technology ventures in the size of about $50 to $100 to 150 million, giving them the special access so that the —

Sir, micro and small enterprises are the backbone of our community. They provide economic stability for the nation and livelihoods for many workers. However, their economic contribution remains disproportionately low. They employ 45% of our workers but contribute only 11% of nominal value added. This productivity gap translates into lower salaries. These businesses can afford to pay their workers.

ASME has observed that the current classification of SMEs is too broad. A micro enterprise with 10 employees and $1 million in revenue, faces fundamentally different hurdles compared to a medium-sized company with 200 staff and $100 million in turnover. By grouping them together, we risk applying one size fits all solutions that may not reach the smallest players.

Would the Government adopt ASME's suggestion to delineate micro enterprises and SMEs in national policy-making and data collection? Tailoring grants and other assistance to the specific operational realities of each tier will make Government support more effective for them. ASME estimates that a 10% uplift in the value added of this segment could translate to an additional $6.5 billion dollars in annual gross domestic product (GDP), equivalent to more than one percent of growth. Focusing more on these micro and small enterprises is a significant opportunity to lift the wages of many Singaporeans.

Mr Chairman, I would like to speak on SME transformation. SMEs employ seven out of 10 workers in Singapore and form the backbone of our economy. In supporting transformation, we must recognise that many SMEs are family-run businesses facing generational succession and ownership transitions. This is not only a governance issue. It is an economic and cultural one.

Business transformation often cannot progress meaningfully until ownership structures are stabilised. Where succession is unclear or governance frameworks remain informal, it becomes difficult to invest in digitalisation, expansion or strategic pivots. Transformation requires clarity of leadership and ownership.

I therefore suggest that our SME transformation framework integrate succession planning and family ownership transition as core components of enterprise upgrading.

Cultural nuances also shape how ethnic family businesses approach governance and decision-making. This was evident during a Government Parliamentary Committee (GPC) of Finance, Trade and Industry engagement with the Singapore Malay Chamber of Commerce and Industry (SMCCI), where heritage businesses shared how cultural norms influence succession and continuity. Different communities may view succession and professionalisation differently, and a one-size-fits-all model may not be effective. Enterprise Singapore could deepen engagement with ethnic chambers such as the Singapore Chinese Chamber of Commerce and Industry (SCCCI), the SMCCI, and the Singapore Indian Chamber of Commerce and Industry (SICCI) to support more tailored approaches.

Enterprise Singapore could also expand support to cover family ownership transition, including grants for succession planning, governance restructuring and ownership transfers. Institutions such as Singapore Management University’s Business Families Institute can partner with chambers to develop tailored succession playbooks.

As more heritage SMEs reach generational handover points, a smooth ownership transition is critical to preserving long-established enterprises. By integrating succession support into SME transformation policies, we can strengthen long-term enterprise resilience while retaining the cultural and social value that these businesses contribute to Singapore.

Chairman, Singapore SMEs face distinct challenges alongside day‑to‑day operational constraints and pressures to transform, they must internationalise because our domestic market is limited.

Rental and manpower are among their largest cost components. Compliance burden is also a concern, and I had raised this in my cut to MOF last week.

Beyond general labour shortages, firms increasingly need digitally skilled talent who can deploy AI to raise productivity, automate routine tasks and scale operations. They also require coherent enterprise‑level AI strategies and rapid transformation to stay competitive in this AI era. The measures in Budget 2026 are therefore welcome.

I just have one question on this particular point. Learning from past experiences administering grants and credits, how will the Government ensure that financial support and eligibility criteria for tax deductions are precisely targeted, so that funds are spent effectively to create the intended impact. In Chinese, “钱用在刀口上”.

On rentals, there had been speculations that foreign capital inflows are pushing up commercial rents and crowding out local operators. Notably, based on the Parliamentary reply by Deputy Prime Minister Gan Kim Yong in January 2026, China is the second largest owner of retail businesses in Singapore. Even though Chinese owners account for only 3% of retail businesses, the perception of displacement cannot be ignored, and this can affect community sentiment and our unique Singapore “personality”.

What steps will MTI take to ensure local SMEs remain the anchor in Singapore? Can the Ministry consider targeted measures, such as rental relief schemes, tenancy support for heritage and neighbourhood retailers, incentives for landlords to prioritise local tenants or co‑investment platforms that enable local businesses to secure long‑term premises?

Finally, SMEs need help managing rising costs and reaching beyond our shores. Will MTI expand programmes to help these SMEs further optimise costs in areas, such as group procurement, energy efficiency grants, shared services, market access and trade facilitation?

Chairman, in a tighter Singapore, domestic scale alone will not sustain enterprise growth. For Singapore businesses, internationalisation is essential for long-term competitiveness and resilience.

The Middle East conflict that unfolded over the weekend reflects how quickly geopolitical conditions can shift. Energy markets react, insurance premiums adjust, shipping routes are reassessed and payment and compliance risks increase. In such an environment, uncertainty can cause firms to hesitate.

How will MTI continue to send a strong and consistent message that despite heightened geopolitical risks, Singapore firms must press on with internationalisation and that the Government will stand behind them as they do so?

At the same time, we must recognise internationalisation risk is not uniform. It varies sharply by market. Parts of Southeast Asia, the Middle East, Africa and Latin America often carry elevated political, regulatory and receivable risks. Working capital cycles are longer. Payment discipline can also be less predictable. Could MTI consider differentiating internationalisation support not only by firm size, but also by market risk profile, with enhanced working capital guarantees, political risk coverage or expanded risk-sharing mechanisms in higher-risk corridors?

Second, many overseas projects today are too large or too complex for individual SMEs. Procurement frameworks favour scale, track record and integrated capability. Encouraging consortium-led bids, enabling firms to "hunt as a pack", would allow complementary Singapore companies to pool capabilities, share risk and compete for projects none could secure alone. Could existing schemes be restructured more explicitly to support consortium-based international bids, including shared financing and coordinated market entry?

Finally, as firms from Northeast Asia and Europe increasingly view Singapore as a gateway into Southeast Asia, our ecosystem must deepen its regional fluency – regulatory expertise, multilingual advisory capability and strong in-market partnerships anchored through our trade associations and chambers. We must strengthen not just financing support, but market intelligence, corridor expertise and in-market execution platforms.

In a more uncertain world, the answer is not retreat. It is a calibrated expansion backed by credible risk-sharing and a confident ecosystem —

Thank you, Chair. Budget 2026 positions AI, alongside strategic capabilities such as quantum, advanced manufacturing and space, as critical to Singapore's ability to thrive in a changed world. The thrust is clear – upgrade firms, reskill workers and build new growth engines.

That is the right direction. But transformation will not be fully realised without our entrepreneurs.

Technological shifts do not only upgrade incumbents, they create new markets. AI lowers startup overheads. Advanced manufacturing and deep tech open new value chains. As we build capabilities within firms, we must also enable more Singaporeans to build new ventures around these emerging domains.

Let me raise three areas.

First, de-risk entrepreneurial participation. About half of new firms do not survive beyond five years. Fewer than 1% become unicorns. When people see these statistics, the instinctive response is, "It's too risky. We don't want to try."

But if too few are willing to try, the economy suffers. Innovation slows. New growth engines do not emerge. To bridge that gap, we must reduce the perception that entrepreneurship carries a permanent career penalty. Entrepreneurship should be normalised as another step in a career journey, not a make-or-break endpoint. It should be seen as part of lifelong learning – a period of experimentation, skill development and value creation.

May I ask the Ministry, beyond capital incentives, how are we strengthening pathways that allow Singaporeans – from fresh graduates to mid-career professionals – to venture into entrepreneurship and return to employment without stigma or structural disadvantage? After all, research shows that the average founder of high-growth firms are in their early to mid-40s. Experience and networks matter, especially in complex sectors. Small nations, like ours, cannot afford permanent talent loss from temporary setbacks.

Second, we can convert national missions into startup growth. As sectoral missions unlock opportunities in AI, manufacturing, connectivity and healthcare, how do we ensure Singapore-based startups are meaningfully plugged into these platforms? Can procurement pathways, pilot projects and structured partnerships be strengthened so that startups led by Singapore-based founders can validate and scale? In frontier sectors, such as quantum and space, can cross-agency sandbox models support experimentation and co-learning while accelerating deployment?

If we get this right, national missions can catalyse local venture growth and not just enterprise upgrading.

Third, we need to anchor long-term value. It is one thing to grow new ventures here, it is quite another to ensure that as they scale globally, they remain anchored in Singapore. If strategic decision-making, IP and leadership functions relocate elsewhere in pursuit of capital and customers, we risk losing gains in control, capital formation and ecosystem spillovers.

The expansion of the Startup SG Equity fund and the Equity Market Development Programme (EQDP) are all important steps, but my question is, as more Singapore companies scale globally, how do we ensure leadership, IP ownership and value creation remain anchored here so that —

Chairman, I would like to speak on three things: funding, founders and talent for our startups.

With the additional $1 billion injection into our Startup SG Equity, I would like to ask MTI what specific gap we are trying to close? Is the constraint today early-stage formation or is it at the growth stage, where companies have product-market fit but struggle to scale regionally? Is it a shortage of later-stage capital or is it a lack of sector depth in areas, such as deep tech and industrial solutions?

I would appreciate clarity on how MTI has diagnosed this gap and how the capital will be deployed? Are we crowding in experienced regional and global growth funds? Are we co-investing alongside operators who can help companies to expand beyond Singapore? We should also avoid concentrating public funds within the same small pool of startups. Co-investment should widen participation, deepen sector capabilities and bring in new founders and new markets.

Beyond funding, I would like to check on the Startup SG Founder scheme. I heard that one of the founders must be a first-time founder to get this scheme. But we know that startups fail due to a myriad of reasons. In the spirit of supporting and encouraging entrepreneurship, I would like to check if this criterion can be reviewed?

On talents, hiring a full-time chief AI officer can be costly for early-stage firms. This is distinct from the chief technology officer (CTO) advisory schemes. A CTO builds the product. A chief AI officer shapes data strategy, model development and responsible AI use across the organisation. Could we explore a chief AI officer as a service model, allowing experienced AI leaders to support multiple startups so that they can deploy AI properly and scale with confidently?

Funding, talents and founders help companies to grow.

Mr Chairman, let me thank all Members who have spoken on MTI's COS.

Last year, Singapore's economy grew by 5%, performing better than expected despite a challenging global environment. At the same time, we must be clear-eyed. Singapore is entering a new phase in our economic journey. The rules that allowed Singapore to prosper for decades have fundamentally changed. We face a more complex global environment, marked by heightened great-power competition, rising protectionism and a more fragmented global order.

The United States (US) Supreme Court has struck down the reciprocal tariffs that were imposed last year and the US Administration has since replaced it with a new Section 122 tariff of 10% for up to 150 days. President Trump has also announced that he intends to raise it to 15%. The details are not there yet. There is still considerable uncertainty about how the tariff will evolve over time.

We are working with the Singapore Economic Resilience Taskforce (SERT) tripartite members to provide information to and gather feedback from businesses and workers to help them navigate these uncertainties.

These developments exemplify the unpredictable and uncertain global trading environment that we must now navigate. That is not all. Over the weekend, the conflict in the Middle East escalated, with the US and Israel launching an attack on Iran, and Iran retaliating by counterattacking Israel and US' bases in the region. The Strait of Hormuz, which is a key shipping route for crude oil and liquefied natural gas (LNG), has been closed.

In the near term, this could result in an increase in global energy prices. Depending on how protracted the conflict is, higher energy prices could lead to higher costs for businesses and consumers and weigh on the global and Singapore economies. We are monitoring the developments closely and will reassess our GDP and inflation forecasts if necessary.

Major structural forces are also reshaping industries, businesses and jobs.

AI and automation are transforming how value is created and how work is organised. The global push to decarbonisation is also changing industrial processes, influencing investment patterns and impacting relative competitiveness.

Together with our demographic constraints that I spoke about last week, sustaining growth and creating good jobs will become more challenging. Yet even in this more difficult environment, there are good opportunities for Singapore as a trusted, knowledge-driven and connected hub.

This is why the Government set up the Economic Strategy Review (ESR) to take a hard, honest look at how Singapore must reset our economic strategy. We will have to work harder and smarter, be creative and take calculated risks, and explore bold solutions to reach the higher end of our GDP trend-growth of 2% to 3% per annum, on average, over the next decade and create good jobs.

Let me outline broadly five strategic thrusts and my colleagues in MTI will elaborate later. First, we will establish and deepen our leadership in key growth sectors, while pushing the frontier into new areas of growth. As our economy matures, growth and good jobs can no longer come from scale alone. Growth must increasingly come from depth – by establishing and deepening global leadership in sectors where Singapore already has strong foundations.

Mr Saktiandi Supaat asked about our plans for the advanced manufacturing, trust-based services and frontier sectors. Singapore is already a global node in advanced manufacturing sectors, such as semiconductors, medical products, specialty chemicals and aerospace, which contribute significantly to our economy and provide good jobs.

We want to secure and extend our leadership in these sectors – we will step up investments in AI, automation and digital technologies to raise productivity, improve quality and reliability, and become more flexible and resilient. As factories become more automated and data-driven, demand will grow for skilled jobs, such as automation and robotics engineers, process engineers, data specialists and advanced equipment technicians, that command higher wages.

We will also focus research and development (R&D) resources to sharpen our technological edge, shorten innovation cycles and help firms move ideas faster – from the lab to the factory floor and into the market. In parallel, we will accelerate the adoption of low-carbon and resource-efficient technologies, so that our industries remain competitive as the world transitions to a low-carbon future. By reinforcing these strengths, we will build deep, competitive ecosystems that anchor high-value activities here and support good, skilled jobs for Singaporeans.

Beyond manufacturing, we are also extending our lead in modern services. In this volatile and uncertain world, trust has become the most sought-after asset. Our trust premium has enabled us to establish ourselves as a global hub for finance, capital and IP. We will build on this to develop Singapore as a global hub for trust-based services, such as risk advisory, cybersecurity, AI assurance and Testing, Inspection and Certification. This will create new opportunities in modern services.

Even as we deepen our existing strengths in advanced manufacturing and modern services, we must also push the frontier into new areas of growth, such as quantum, decarbonisation technologies and space-related industries. As these industries grow, they will open up new career opportunities for Singaporeans.

Taken together, these will deepen what we already do well in advanced manufacturing and modern services, while creating new engines and expand Singapore's growth frontier, and secure high-quality jobs for Singaporeans.

Second, we must sustain a dynamic and vibrant enterprise ecosystem, spanning multinational corporations, high-growth companies and a vibrant start-up community. Leading MNCs, both local and foreign, will continue to be a core pillar of our economy. They bring scale, advanced technologies, global networks and high-quality jobs. We will continue to work with MNCs to anchor high-value activities here, including R&D, advanced manufacturing, regional and global headquarters functions, and strategic roles.

At the same time, the next phase of growth will increasingly come from a new generation of emerging enterprises – growth-stage companies that have yet to establish themselves as a leading MNC but have demonstrated both the potential and ambition to become future industry leaders.

We must be prepared to take some risks to support such promising enterprises by providing them with a trusted base to operate from, and scale to international markets. One such company is Workato, an enterprise software firm that helps businesses automate workflows and integrate systems across their operations. Workato's Asia Pacific revenue has increased 10-fold over the past five years, with a customer base of more than 12,000 companies across sectors, such as manufacturing, financial services and healthcare.

Singapore can serve as a strategic base for Workato's global expansion, anchoring product development, AI innovation and regional leadership here, while creating high-value opportunities for Singaporeans and strengthening our talent pipeline.

I agree with Assoc Prof Kenneth Goh that anchoring and partnering companies, like Workato, in Singapore at an early stage of their growth is important as it would allow us to shape where strategic HQ decisions are made, where core capabilities are built and where long-term value is created. As these companies grow from Singapore, they will create new roles here in areas, such as R&D, product management, marketing and business development.

EDB will step up efforts to identify and anchor such companies, working closely with leading venture capital and private equity partners. We will provide bespoke, end-to-end support, such as market access assistance, regulatory facilitation and access to ready-to-use facilities, to help these companies anchor in Singapore and grow their presence here.

Done well, this will allow us to capture long-term economic value, strengthen our pipeline of leading enterprises and reinforce Singapore's position as a trusted base for globally leading companies to be here and to scale. We will not just be a landing pad, but also a launching pad for potential global companies.

Alongside this, we will continue to sustain the vibrancy of our start-up community and foster an entrepreneurial culture where people dare to dream and take risks. Minister of State Alvin Tan will share more on our plans for our startups. By sustaining dynamic and vibrant enterprise ecosystems, we will reinforce Singapore's position as a trusted and connected base for global business and ensure that our economy remains at the forefront of innovation and growth.

For our enterprises to raise productivity, upgrade capabilities and scale innovation faster than before, AI is the critical enabler. Our third thrust is therefore to establish Singapore as an AI leader, as well as an AI-empowered economy. We want to empower our companies to harness AI end-to-end, by redesigning business processes, embedding AI into core operations, developing proprietary applications, transforming workflows and upgrading jobs and skills.

To date, we have supported over 60 companies to establish AI Centres of Excellence. These are in-house teams focussed on developing and deploying AI solutions. We will take this further by launching a "Champions of AI" programme later this year. Under this programme, we will target a select group of Singapore-based companies with the ambition and commitment to make AI a core driver of productivity, innovation and growth. We will partner these companies to transform their businesses, by embedding AI across core operations, organisational processes and workforce practices.

This includes leadership and workforce training, as well as support to develop and execute AI transformation projects with clear and measurable business impact. These companies will also invest in retraining and upskilling their employees, enabling their workers to take on high-value AI-enabled job roles.

Let me give DBS as an example. AI has been embedded throughout the bank's operations, from customer engagement to risk management and operational efficiency. For instance, through personalised AI-driven nudges, DBS guides retail customers to make better investment and financial decisions. These customers saved twice as much, invested five times more and had nearly three times higher insurance coverage than those who did not.

In risk management, AI analyses millions of transactions daily to detect unusual patterns and intercept suspicious activity in real-time to better protect its customers. DBS has also deployed AI in institutional banking, reducing processing times for trade documentation by 60%. This helps businesses move faster, with greater certainty, especially in cross-border transactions.

DBS is equipping all 40,000 of its employees with foundational understanding and practical exposure to AI. It is also reskilling employees into new job roles that are being created through the integration of AI – for example, from customer service officers into AI agent monitoring managers and GenAI evaluators. AI has also provided some employees with the opportunity to move into new career pathways – for instance, from customer service roles into relationship management roles.

DBS' journey demonstrates how companies can deploy AI to enhance business value while strengthening their workforce. In 2025, DBS reported that economic value from its data analytics, AI and Machine Learning initiatives achieved a record of approximately $1 billion. AI champions are pathfinders. We will learn from their experiences, show the way forward and give other firms the confidence to move faster and deeper in their own AI journeys.

We also want to be an AI leader in the development, testing, deployment and scaling of AI. We will drive AI transformation at the sector level through AI Missions, starting with advanced manufacturing, connectivity, finance and healthcare – sectors where Singapore already has strong foundations.

For each Mission, we will work with the industry to define sharp, sector-specific problem statements in areas where AI can drive breakthrough transformations. Around each Mission, we will build full-stack ecosystems, including datasets, computing resources, regulatory sandboxes and solution providers. This will shorten the path from development to deployment and from testing to scale.

These Missions will generate demand for new skills, creating clusters of expertise anchored in Singapore. AI Missions serve as rallying flags to attract global AI talent and companies focused on real-world applications, mobilise whole-of-nation efforts across the Government and industry, and concentrate investments and enablers for greater impact.

We will also establish an AI Park as a focal point where talent, problem owners, researchers and resources can come together to create synergy and nurture a deep ecosystem. We already have Lorong AI; and we will now also build an entire "Kampong" – Kampong AI at One-North. "Kampong AI" will accelerate collaboration and serve as a centre of gravity for AI excellence.

These efforts – "Champions of AI", AI Missions and "Kampong AI" – will position Singapore as a place where AI solutions are built, proven and scaled, empowering firms across the economy and establishing AI leadership in key sectors.

Even as we grow our economy, our competitiveness will depend not only on innovation, but also on the ability of our businesses to adapt, reposition and transform. Firms will increasingly face the need to relook at how they operate. Business models that once worked well may no longer be viable under the current and future environment. In response, firms may need to pursue different pathways, transforming their business models, restructuring their operations or, where necessary, scale down or even exit specific products, services or parts of their operations.

Our next thrust is therefore to support our businesses to proactively and confidently navigate these transitions. Such adjustments are a normal and necessary part of economic renewal. But we recognise that the process can be difficult, challenging and sometimes, painful.

We will work closely with trade associations and chambers, enterprises and the Labour Movement to support firms as they go through these transitions, helping them assess their options early, restructure responsibly, pursue new growth opportunities, including exploring overseas markets and manage change in a way that strengthens long-term competitiveness and supports workers through the transition.

I agree with Mr Shawn Loh that with our small domestic economy, many growth opportunities lie beyond Singapore's shores. We want to help our companies to not only export their products and services, but also to expand and invest internationally. This will allow them to benefit from the growth of the global economy, while anchoring value, capabilities and leadership functions here in Singapore.

We will step up support for leading companies pursuing significant overseas ventures that may involve higher risks and capital outlay, especially in developing and emerging markets, but which give them a real and lasting foothold in key markets and value chains. In addition to growing their revenue and profits from overseas, these companies will bring value back to Singapore through better jobs, stronger demand for local capabilities and deeper integration into global growth opportunities.

I agree with Ms Elysa Chen and Mr Victor Lye on the importance of supporting and preparing our entrepreneurs and workers embarking on internationalisation. The Ministry of Manpower will share more on this.

We will also safeguard and expand our international economic space. Minister of State Ms Gan Siow Hwang will elaborate more on our plans to deepen and diversify our economic links with our trading partners.

Mr Chairman, the global environment will remain uncertain. The road ahead will not be easy. But Singapore has succeeded so far not by waiting for certainty, but by planning long term, acting early and moving ahead decisively.

The ESR has outlined our strategy going forward. Our five strategic thrusts build on our strengths, embrace new opportunities, harness technology, keep Singapore open and connected and support our people through change, every step of the way.

We will ensure growth must translate into good jobs for Singaporeans. Above all, our strategy is to give workers the confidence to adapt, businesses the ability to compete and every Singaporean a share in our progress and a stake in our future. If we continue to stay united, remain agile and nimble and keep investing in our people, Singapore will not just navigate change – we will shape it. [Applause.]

Mr Chairman, as the Deputy Prime Minister has highlighted, the rules that allowed Singapore to prosper have fundamentally changed. Technologies, especially AI, are rapidly disrupting industries. Climate change continues to accelerate, and its impact is affecting our way of life. How do we therefore seize opportunities in spite of all these challenges?

We will leverage science and technology to establish leadership in key growth sectors and push the frontier into new growth areas. We will also strive to establish Singapore as an AI leader, transforming our advanced manufacturing industry. Powering these efforts, at the core, is energy, which must be sustainable, secure, reliable and affordable.

To extend our lead in advanced manufacturing, we will continue to direct national-level R&D resources towards our key growth sectors.

Our Research, Innovation and Enterprise (RIE) 2025 investments have boosted the R&D capability and capacity of our economy as well as created good jobs. For manufacturing, the annual private sector R&D expenditure in 2023 was $4.3 billion, which is a 54% increase from 2016. Industry R&D jobs grew by 36% between 2016 and 2023 to more than 30,000, of which more than 70% were filled by locals.

One key growth sector is semiconductors. We have built strong R&D capabilities through past RIE investments, and we have anchored a total of more than $30 billion in investments from semiconductor companies, over the past four years. We will further invest $800 million to establish the RIE Flagship in Semiconductors, focusing on high-impact technology areas, such as Advanced Packaging and Advanced Photonics, which boost chip performance while cutting power use.

The Flagship will translate research into products and encourage more advanced R&D and manufacturing activities, creating good jobs in Singapore.

The Flagship will also bring together efforts under the National Semiconductor Translation and Innovation Centre (NSTIC). Since its launch in RIE2025, NSTIC has achieved several breakthroughs, including in high-speed data transmission and metalens fabrication. It has since attracted over 10 industry partners and has built a strong commercialisation pipeline.

Last year, the Deputy Prime Minister announced our investment in NSTIC (R&D Fab), which is our semiconductor R&D fabrication facility. It is on track to commence operations by 2027, and companies have shown strong interest in the facility’s collaboration space.

We will also invest $60 million in NSTIC (Power Electronics) to strengthen Singapore’s competitiveness in next-generation power electronics. Within a year, we aim to double the carrier mobility of silicon carbide technologies, enabling the potential development of smaller, but more efficient power systems. Use cases include extending the driving ranges of electric vehicles (EVs).

Another key growth sector is biomedical, which remains robust despite its inherent volatility. To boost sector growth, we announced two R&D translational platforms in 2024, namely the Nucleic Acid Therapeutics Initiative (NATi) and MedTech Catapult. These platforms are attracting global partners, they are uplifting local enterprises, and training talents to anchor high-value R&D activities and jobs in Singapore.

For example, MedTech Catapult is working with a local startup, Vivo Surgical, to develop its verification prototype to be ready for clinical studies, and has onboarded the company onto its venture acceleration programme.

Given the good progress of these platforms, we intend to scale them further under RIE2030.

Besides public sector efforts, the private sector also plays a crucial role in our innovation ecosystem. Through our Research and Innovation Scheme for Companies (RIS(C)), we have attracted substantive private research and innovation investments, building capabilities and creating high-value jobs for locals.

In the past five years, companies have committed more than $14 billion to research and innovation investments here; and it has created more than 12,000 jobs in research, development, and innovation roles. Again, with locals filling more than 70% of these positions. Some examples. Grab's Artificial Intelligence Centre of Excellence has hired around 50 people, while Evonik, the German chemicals giant, has hired over 100 researchers for its Asia Research Hub in Singapore.

Building on this, we will invest more than $3 billion in RIS(C) in RIE2030.

Beyond existing growth sectors, we will boldly pursue emerging technologies that can drive breakthroughs across our economy. One example is space technology, the “final frontier”, which is rapidly moving from science fiction to real-world applications.

Space technology is already used in our daily lives, powering navigation and connectivity. As technologies advance, as costs fall, smaller countries like Singapore can capture opportunities in the growing space economy. This can create good jobs for Singaporeans in areas such as engineering and data science, while enabling businesses to capture value from space-enabled services and applications.

One such opportunity is space-based Earth observation, which can be used in industries such as maritime, sustainability and finance. A local startup, Arkadiah Technology, is using satellite data in its partnership with a global agribusiness company – Golden Agri-Resources – to support digital measurement, reporting and verification. This enables more accurate carbon accounting of tropical forests.

To advance our ambitions, we will be establishing the National Space Agency of Singapore (NSAS), which I announced last month. From the initial 30 officers from the Office for Space Technology and Industry (OSTIn), NSAS is expected to double in size over the next three years.

As we develop our growth sectors, we will continue to partner firms to equip Singaporeans with in-demand and emerging skills.

Earlier, the Deputy Prime Minister shared our vision to establish Singapore as an AI leader, with an AI-empowered economy, through the development and execution of AI Missions across four priority sectors. One priority sector is Advanced Manufacturing. We will work with industry partners to further develop the AI Missions and we will provide an update later.

These preliminarily will be anchored on three thrusts. First, we will leverage AI and robotics to transform our manufacturing facilities to achieve best-in-class outcomes that can become more agile, more resilient and more efficient. Second, we will harness AI to create first-in-the-world solutions, by enhancing product designs and accelerating development cycles. Third, we will drive broad-based sectoral transformation, by helping companies adopt AI in key operations to accelerate the deployment of solutions across the ecosystem.

To support these efforts, we will strengthen two key enablers. First, A*STAR's Sectoral AI Centre of Excellence in Manufacturing (AIMfg). Launched about a year and a half ago, AIMfg has supported close to 30 firms in developing and adopting AI-enabled solutions.

For example, Sunningdale, which is a large local manufacturer of precision-engineered plastic components, is partnering AIMfg to develop an AI-powered defect detection system. Early trials are promising, with expected annual cost savings of more than $150,000 for each product.

AIMfg has also developed a set of common AI models that address typical business needs, such as a predictive maintenance model for rotary devices. This reduces resources and time needed to develop custom solutions from scratch.

Moving forward, AIMfg will further drive AI-led transformation with partners and expand the suite of common AI models.

Second, we will build capabilities in Embodied AI. Embodied AI brings AI into our physical world – robots that can sense their surroundings, that can reason independently and they can act with purpose in unfamiliar environments.

We will invest in R&D to address complex problems faced by our companies and provide shared infrastructure for researchers and companies to test new Embodied AI technologies. Such infrastructure can accelerate deployment of technologies in frontier sectors, which is something that Assoc Prof Kenneth Goh talked about. We will begin with the Advanced Manufacturing, Aviation and Maritime sectors. This can seed new growth areas, by attracting next-generation Embodied AI startups as well as grooming local champions.

To fully unlock AI’s potential for businesses, we will also contemporaneously build an AI-ready workforce through education and training, and support companies in job redesign and workforce transformation. I will elaborate on these efforts in my Ministry of Manpower speech tomorrow.

Mr Chairman, given these shifts, our economy is becoming more digital and innovation-driven. As pointed out by Ms Tin Pei Ling and Mr Edward Chia, energy powers all these efforts. For our economy and our way of life, energy is existential. As demand grows and as we decarbonise, the Government will continue to strike a pragmatic balance between energy sustainability, security and affordability. Decarbonisation will come with costs, but it cannot and it will not be at all costs.

Let me illustrate this using an example, which will also address Ms Nadia Samdin’s earlier question on carbon tax. We will regularly review the transitory allowances, which only cover a portion of companies’ emissions, for us to strike the right balance between maintaining a price signal to encourage investments in low-carbon solutions and managing the rising costs.

As we pursue a diversified portfolio of renewable energy pathways, we will also focus on scalable and cost-effective solutions. As with Singapore’s Water Story, we will first prioritise pathways that support our self-sufficiency and resilience, by maximising our indigenous sources.

Solar remains our most viable option in the near term. We have made remarkable progress. Last year, we reached our 2030 target of two gigawatt-peak (GWp) of installed solar capacity, five years ahead of schedule. We are therefore raising the target to three GWp – an increase of 50% – by 2030, and we aspire to double last year’s achievement within the second half of the 2030s.

However, even with widespread deployment, solar will only supply, at best, about 10% of our future electricity needs, due to land constraints and climate conditions. So, while solar energy is important, it is insufficient. That is why we are currently studying our geothermal resource potential.

Besides indigenous sources, we are also pursuing other low-carbon pathways. Electricity imports from the region can diversify and decarbonise our energy mix. To date, we have awarded around 8.4 gigawatts (GW) of Conditional Approvals to promising projects. Of which, three GW have advanced to Conditional Licences. We are working closely with project developers to secure the necessary regulatory approvals to commence construction soon.

Through close collaboration and cooperation with our neighbours, which is essential, as we strive towards our regional vision of the ASEAN power grid, our first wave of electricity import projects will likely come from Indonesia and Peninsular Malaysia. To prepare for imports from Indonesia, we have identified suitable subsea cable connection routes and landing sites. We are also conducting a full feasibility study on a second interconnector between Singapore and Malaysia. If this is developed, this could provide up to two GW of bilateral interconnection capacity, on top of the one GW of capacity from our existing interconnector.

Beyond this, we are also exploring other low-carbon solutions. As I have said before in this House, no option is off the table. First, we are exploring biomethane as a viable low-carbon fuel through a regulatory sandbox of up to 300 megawatts (MW). Its compatibility with existing infrastructure minimises the need for costly asset upgrades. Since last year, we have seen strong industry interest. We are currently evaluating proposals for the sandbox, and we expect to appoint demand-supply aggregators soon.

Second, we are studying the potential of low-carbon hydrogen, including its derivatives, or its carriers, such as ammonia. Last October, we appointed a consortium led by Keppel to conduct Front-End Engineering Design (FEED) studies for the next phase of the ammonia pilot project for power generation and bunkering.

Third, we are also studying the potential of carbon capture, utilisation and storage solutions to decarbonise hard-to-abate sectors. We will continue working with countries that have suitable geological sites for carbon storage, such as Australia, Indonesia and Malaysia, on bilateral agreements to offer the private sector greater investment certainty. We are also studying ways to store captured carbon permanently in products such as building materials.

Based on the results, we will assess how these pathways can be scaled up, the type of mix possible, to achieve our decarbonisation ambitions.

Let us be real. Even as we pursue all of these options, we must remain clear-eyed about their inherent challenges. Imported electricity comes with significant geopolitical risks and uncertainties. Other low-carbon solutions are not yet ready for deployment at scale, either due to technological nascency or under-developed supply chains.

Thus, while we have not made a decision – and let me reiterate this, we have not made a decision – we are seriously studying the potential deployment of advanced nuclear energy technologies, such as small modular reactors.

Nuclear energy has the potential to be a safe, reliable and cost-competitive option. Its high fuel density is especially attractive for land-scarce Singapore. Just think about it. Five one-inch-tall pellets, which are each smaller than my thumb, can generate the same amount of energy as one Olympic-sized swimming pool of natural gas. We are intensifying our capability building, especially in nuclear safety and technology assessment.

We will do so in line with the International Atomic Energy Agency's Milestones Approach, and we will partner international leaders such as the US, France and the Republic of Korea. In fact, just this morning, this is one of the few moments I come in with a tie, this morning, the Energy Market Authority (EMA) just signed a Memorandum of Understanding (MOU) with the Korea Hydro and Nuclear Power Company, which operates South Korea's entire fleet of 26 nuclear energy reactors, on the sidelines of the President's visit from the Republic of Korea.

Public trust will be essential. We will work closely with partners on raising awareness, not just for nuclear, but more fundamentally, the existential nature of energy.

As Mr Edward Chia and Mr Ng Shi Xuan have pointed out, we must continue to ensure the continued reliability of the grid, as Singapore moves to a heterogeneous mix of energy.

Last year, EMA and SP Group launched the Future Grid Capabilities Roadmap to set clear directions for capability building in areas, such as system inertia and flexibility technologies. EMA is also piloting a Virtual Power Plant regulatory sandbox with industry partners and assessing whether more energy storage systems are required, to address challenges such as intermittency.

Underpinning all these efforts is science and technology as the key enabler. We are launching a new $800 million Decarbonisation Grand Challenge under RIE2030, in support of our 2035 abatement targets and 2050 net-zero ambitions. Building on past efforts, we are significantly increasing investments in promising solutions to reduce power sector and industry emissions and, at the same time, to ensure a reliable and resilient power system.

Under this Grand Challenge, we are launching a new programme, Singapore Pilots for Energy and Enterprise Decarbonisation (SPEED). Speeding is an offence for the Land Transport Authority. But this SPEED is essential. This supports local translational Research, Development and Demonstration activities and it catalyses private investments, to scale up promising yet nascent technologies.

Mr Chairman, innovation and technology will continue to push and propel Singapore to greater heights, and it will create good jobs for generations to come.

As the Deputy Prime Minister pointed out earlier, we are a climate realist. As we strive towards our net-zero ambition, we have to constantly remain mindful of the challenges, such as the geographical constraints and rising decarbonisation costs to businesses and households.

But that said, we will do our utmost best to secure a clean and green future, because this is for our future generations, with a stable and reliable flow of energy, which is existential for our economy and our way of life. [Applause.]

Mr Chairman, Deputy Prime Minister Gan Kim Yong spoke about how Singapore is now entering a new phase in our economic journey.

We are committed to empowering businesses to succeed and thrive in this new landscape. We will continue to nurture a dynamic and vibrant enterprise ecosystem, where enterprises confidently navigate change and succeed.

Businesses today face increasing pressure to adapt in an uncertain world. We have gained keen insights from our engagements with SMEs and the trade associations and chambers (TACs), including the Singapore Business Federation about the challenges on the ground.

Several Members have raised similar concerns, particularly in relation to our SMEs – Mr Saktiandi Supaat, Mr Mark Lee, Mr Lee Hong Chuang, Mr Shawn Loh, Ms Tin Pei Ling, Mr Ng Shi Xuan and Ms Denise Phua. I want to assure them that the Government is leaving no stone unturned to support and to journey alongside our enterprises as they adapt, transform and innovate to overcome the challenges faced.

I am pleased to share that the Government has tailored a "Business Refresh Package" that comprises a suite of enhancements to existing schemes, to enable, equip and empower our enterprises at every step of their journey to stay resilient, grow and thrive by: one, enhancing their productivity and cost efficiency; two, growing their revenue and helping them capture fresh opportunities at home and abroad; and three, fostering a pro-enterprise and trusted business environment.

We will also enable our businesses to proactively navigate transitions, while continuing to strengthen our consumer protection framework.

Let me now elaborate on each thrust of the "Business Refresh Package".

First, enhancing productivity and cost efficiency. Over the years, the Government has rolled out a range of schemes to support companies in capability building, productivity and efficiency improvements. Businesses that can do more with less and respond quickly to changes are best positioned to stay competitive. Structural changes brought about by AI and decarbonisation will mean that businesses have to adapt to stay relevant. But these changes also present opportunities for businesses to transform and to grow.

I want to assure Mr Saktiandi Supaat, Mr Ng Shi Xuan and Ms Denise Phua that we will continue to enable and empower enterprises across all sectors to optimise production processes and to reduce business costs, especially through technology and automation.

For example, enterprises with warehousing operations are increasingly adopting automated logistics solutions to enhance operational efficiency. They can tap on schemes, such as the Enterprise Development Grant (EDG) for funds, and advisory support from industry partners, like the Republic Polytechnic's Centre of Innovation for Supply Chain Management (COI-SCM).

One quick example is the company Frosts Food & Beverage, which operates facilities totalling 75,000 square feet in Bedok and Tuas for the storage and distribution of food products. In partnership with COI-SCM, Frosts conceptualised and rolled out a four-way shuttle automated storage and retrieval system at its Bedok facility. This has led to manpower efficiency improvements of over 30% and approximately $100,000 in annual cost savings for the company.

Beyond productivity improvements, we are continuing to help our enterprises move towards a low-carbon future. We have heard from Minister Tan See Leng earlier.

In 2024, we extended the Enterprise Financing Scheme (EFS)-Green for two years and expanded the scope to cover companies adopting green solutions, in addition to green technology developers. We will extend the EFS-Green for another five years. This will facilitate continued access to financing for companies seeking to build green capabilities and capture new opportunities in the green economy. In addition, to help companies manage rising energy costs and reduce their environmental footprint, we will extend the Energy Efficiency Grant (EEG) for one year. This will provide continued support for investments in energy-efficient equipment.

The second thrust of our package helps the businesses grow revenue by capturing opportunities at home and abroad.

We will help our businesses seize opportunities from the shifting international business environment. I want to assure Mr Shawn Loh that we will continue to strengthen access to financing through schemes like the EFS. In fact, launched in 2019, the EFS has supported thousands of enterprises in securing financing for a wide range of business activities.

We will enhance the EFS in two ways. To allow lenders greater flexibility in structuring loan facilities, we will remove the facility-level sub-caps of $20 million and $30 million per borrower group for the EFS-Trade Loan and the EFS-Fixed Assets Loan respectively, while retaining the overall cap of $50 million. This means that our enterprises can obtain loan facilities that best meet their needs, whether is it fulfilling their contracts, executing projects, or undertaking capital investments. In addition, we will permanently expand the scope of the EFS-Mergers and Acquisitions (M&A) to support companies in securing financing for both domestic and overseas acquisitions.

As global supply chains reconfigure and our domestic market matures, our enterprises are increasingly looking to seize opportunities beyond our shores. Our approach has always been to lower the barriers to entry, to strengthen access to markets and to provide calibrated support. However, like what Members have said, we recognise that expanding businesses overseas now comes with increased risks and uncertainty, like what Mr Mark Lee has mentioned.

Mr Mark Lee and Mr Azhar Othman will be glad to hear that we are indeed stepping up our efforts to help our businesses as they embark on their internationalisation journeys.

First, we will increase the support levels for grant schemes that help businesses venture abroad, from 50% to 70% for SMEs, and 30% to 50% for non-SMEs. This includes schemes like the Market Readiness Assistance (MRA) grant, the Business Adaptation Grant and the Global Innovation Alliance.

Second, we will further enhance the MRA grant. Members will remember at MTI's COS debate last year, I announced an extension of the $100,000 grant cap to 31 March 2026.

This year, in addition to extending the $100,000 grant cap, we will remove new markets criteria and will extend grant support to all local businesses, including both SMEs and non-SMEs. I think this is a point that Mr Shawn Loh will appreciate. This will not only support businesses in accessing new markets but also enable them to deepen their presence in existing markets.

Next, we will enhance the Double Tax Deduction for Internationalisation (DTDi) scheme. To help the companies seize overseas opportunities with greater speed and certainty, we will increase the expenditure cap for automatic DTDi-qualifying activities from $150,000 to $400,000 and make existing qualifying activities eligible for automatic deductions.

Lastly, the Global Innovation Alliance will have a refreshed strategy which supports startups' market expansion across two tracks, "Launch" and "Grow". Startups new to the market will be supported through "Launch" programmes focused on market discovery and familiarisation, shorter market sprints and early customer and partner discovery. Startups and SMEs requiring more tailored support can tap on "Grow" pathways to access specialised partnerships to support expansion, deeper market penetration and accelerate technology maturation.

Mr Chairman, no discussion of our enterprises will be complete without mentioning our heartland shops. Heartland shops intersect closely with the lives of everyday Singaporeans, contributing to the character and the vibrancy of our communities.

Helping our heartland enterprises also entails enabling their adaptation and renewal for the future. Over the years, the Government has supported heartland enterprises in refreshing their product offerings, adopting novel concepts and creating experiences that draw footfall and in fact, increasingly, online orders as well, and also strengthening community ties.

To encourage the rejuvenation of our heartland shops, we will enhance the support levels of our heartland schemes, the Enhanced Visual Merchandising Programme and the Heartland Enterprise Placemaking Grant, from 50% to 70%. We encourage our heartland shops to take this opportunity to refresh their stores and conceive exciting placemaking activities.

Many of our heartland shops are small and micro enterprises, which, as Mr Gerald Giam has mentioned earlier, play a fundamental role in the local economy. The Government certainly recognise the unique challenges faced by firms of different sizes, including micro-SMEs. We have developed targeted assistance to address specific needs and support their long-term growth.

For example, enterprises in sectors with high concentrations of micro-SMEs, such as F&B and Personal Services, are benefiting from sector-specific support to tackle operational challenges, raise productivity and thereby, improving their top line and bottom line.

We understand, many of the F&B establishment face structural cost pressures and capability gaps, as mentioned by some of the Members, including Ms Denise Phua, earlier. And this was also indicated in the recently launched Food Services Productivity Report commissioned by Enterprise Singapore and the Singapore Productivity Centre. This, in turn, leads to compressed margins and limited ability to scale sustainably. However, the same report also revealed that the top F&B performers were able to generate close to three times more sales per man-hour, compared to those at the bottom.

When we look closely at it, the top performing F&B establishments observed five key practices: number one, generally, they embraced and adopted digitalisation and automation; number two, implemented strategic menu design; number three, streamlined workflows and space layouts; number four, outsourced labour-intensive preparation work; and number five, adopted effective workforce management.

Mr Chairman, MTI and Enterprise Singapore will continue to do our utmost to enable and to equip our F&B establishments to gain these critical capabilities.

To help our businesses adopt such best practices, during the Food Services Forum held months ago, we launched three new initiatives to support the food sector to: one, optimise operations through the F&B Process Optimisation programme (POP); two, to strengthen their supply chains through the FoodX Programme, which then supports the F&B companies in centralising their food preparation; three, to accelerate the digital transformation.

Besides all these sector-specific schemes, micro-SMEs looking to build their core capabilities and scale up can also tap on schemes, such as the EDG and Productivity Solutions Grant (PSG), for customised support. So, we encourage them to approach any of our 10 SME Centres for tailored advice and guidance.

Mr Chairman, underpinning our efforts to help businesses enhance productivity and efficiency and grow is a pro-enterprise and trusted business environment. This is the focus of the third thrust of the Business Refresh Package. Beyond enhancing enterprise support, the Government will streamline grant processes to make it easier for our businesses to access the full suite of available measures.

I am pleased to announce a new grant, EDGE, which will provide a single shopfront for Government grants, merging the MRA grant, PSG and EDG. We will simplify the grant application process by combining Enterprise Singapore's three flagship grants, and businesses will find it easier to navigate and apply for funding as they only need to submit a single application under the combined grant framework.

The new EDGE grant will support up to $100,000 per year for eligible activities. Businesses that require more support for customised projects can certainly continue to apply to Enterprise Singapore. Businesses will always have the flexibility to embark on projects aligned to their specific needs. Enterprise Singapore will launch EDGE in the second half of 2026. And once launched, the enhancements to the MRA grant that I just mentioned earlier will come under EDGE.

Mr Chairman, last year, the Government set up the Small and Medium-Sized Enterprises Pro-Enterprise Office (SME PEO). The SME PEO supports businesses by addressing regulatory feedback that spans multiple public agencies, as well as issues arising in new or emerging sectors where regulations may be unclear.

Building on the work of the Alliance for Action on Business Competitiveness in 2024, we also announced three Statements of Commitments under the Inter-Ministerial Committee on Pro-Enterprise Rules Review, to enhance regulatory agility and to reduce compliance burden for businesses. The SME PEO has been working with agencies to implement these commitments.

First, to publish clear service standards for regulatory applications, with a target of 30 working days where possible. I am pleased to share that agencies have published service standards for 93% of their business regulatory applications, with 80% of these applications processed within 30 working days. This helps make our processes more transparent and predictable for businesses.

Second, to extend the validity of business licences to at least three years, and up to five years where we can. Today, 45% of all business licences have a validity period of at least three years. And in three years' time, by 2029, this will increase to 80%, with agencies actively reviewing their policies.

Lastly, to streamline processes to reduce sequential approvals and repeated requests for information. We have simplified multi-agency processes to shorten administrative timelines and to reduce back-and-forth with approving authorities. For example, companies required to undergo Quantitative Risk Assessments (QRA) are expected to save more than 40 days per application following the streamlining of processes by the relevant agencies.

We will also continue to work with agencies to simplify internal processes across domains. One such area is the industrial lease assignments or the transfer of industrial land sites in the secondary market. Currently, all assignment applications are subject to JTC's comprehensive assessment of the buyer's business plan and economic contributions, regardless of the land area or the remaining tenure of the site.

Moving forward, the assignment assessment process will be streamlined for small sites of up to 1.5 hectares, with short remaining lease tenure of no more than 15 years. The proposed uses must support manufacturing activities and there must also be sufficient infrastructure capacity at the sites. JTC will exempt these cases from the full assessment process and will only carry out requisite checks to ensure that assignees comply with prevailing policy and land use guidelines. The revised workflow could reduce the processing time for eligible assignment applications to within one month from the date of the full application. JTC will release more details on this initiative in the first half of this year.

Even as we support firms in pursuing their growth ambition and simplify the processes, we must be prepared to proactively navigate transitions. Companies shared that with the ESR that understanding their business health and future options were vital in navigating transitions.

As Deputy Prime Minister Gan Kim Yong highlighted, businesses will need to adapt to shifting global trade flows, technological disruptions and in fact, tighter resource constraints amid steep changes in the global landscape. This may entail reinventing operating models, as Mr Edward Chia has mentioned earlier, for family and heritage businesses, managing generational transitions to safeguard their legacies.

Businesses can reposition and transform by moving into higher value-added activities, optimising operations, offshoring where appropriate or pivoting towards more viable opportunities to redeploy resources more productively.

The creation, the growth and the consolidation of businesses are all part of a very healthy, vibrant and dynamic enterprise ecosystem. We will journey with our companies every step of the way as they navigate transitions and be their support to help them adapt and emerge stronger. The ESR Committee will share more details in time to come.

Chairman, our trusted business environment is underpinned by consumers' confidence in our businesses and market. I agree with Mr Melvin Yong and Mr Andre Low on the need for robust deterrence and enforcement against unfair trade practices.

The Competition and Consumer Commission of Singapore (CCS) has stepped up its enforcement efforts and secured undertakings from businesses to cease unfair practices. Where necessary, CCS has sought Court injunctions against egregious businesses. However, such actions require careful investigation and due legal process. I thank Mr Melvin Yong for his suggestions to enhance the efficiency of CCS' enforcement actions. MTI and CCS will certainly consider this, as part of the Government's regular review of the remedies under the CPFTA.

On Mr Andre Low's suggestion to strengthen deterrence against egregious companies, we would like to assure you that the Government is monitoring this very closely and stands prepared to take on a whole-of-Government view to enhance our consumer protection regime to safeguard the emerging risks as well as the need to give our enforcement agencies more teeth.

To ensure that our consumer protection regime is up to date, the Government convened an independent Consumer Protection Review Panel last year in March. The Panel will put forward recommendations to address key consumer concerns, including pressure sales tactics and emerging digital harms, such as undisclosed advertisements. The Panel will submit its findings to the Government later this year for a thorough review.

Mr Chairman, the years ahead will be defined by the steps we take today. Through our efforts to raise productivity, support growth and internationalisation, as well as to foster a pro-enterprise environment, we are laying the groundwork for a more resilient, dynamic and competitive enterprise ecosystem.

By working closely with our businesses and trade associations, we will build new capabilities that allow our businesses to respond decisively to uncertainty and to seize opportunities. With these foundations in place, we are confident that our enterprises will not only weather the uncertainty ahead, but continue to grow with strength, resilience and purpose to adapt, transform and succeed. [Applause.]

Mr Chairman, Senior Minister of State Low Yen Ling spoke of how we are helping businesses weather uncertainty. To do so, we must stay relevant in two ways: first, remain attractive to visitors; second, build a vibrant startup ecosystem that is attractive to founders, here and beyond.

Let us start with how we are making Singapore more attractive to visitors. Mr Saktiandi Supaat asked for updates on Tourism 2040. Tourism 2040 is our long-term roadmap that is anchored on quality tourism. We are expanding our reach in segments and markets that can drive higher tourism returns and working with our industry to create more exciting and distinctive experiences.

Our 2025 performance reflects this shift. Last year, we welcomed 16.9 million international visitors, a 2.3% increase from 2024. Importantly, our tourism receipts reached $23.9 billion in the first three quarters of 2025, a 6.5% increase compared to the same period in 2024.

There are a few reasons for this good performance. Last year, we continued to deliver world-class events, including concerts by Lady Gaga and the World Aquatics Championships 2025. We also hosted major meetings, incentives, conferences and exhibitions (MICE) events and opened major attractions, such as Rainforest Wild and Illumination's Minion Land.

Building on this momentum, we expect international visitor arrivals to reach between 17 million and 18 million this year, bringing in approximately $31 billion to $32.5 billion in tourism receipts. To remain attractive to visitors, we will strengthen our stage, our people and our show.

Let me start with our stage. These are our precincts and infrastructure. One of our key tourism precincts is Sentosa. In 2019, then-Prime Minister Lee talked about building the Greater Southern Waterfront, including developing Pulau Brani together with Sentosa. I am pleased to update that we have commenced the first phase of our Greater Sentosa Master Plan.

In Phase One, we will upgrade Sentosa's infrastructure. We will add a new transport hub to link Sentosa and Brani, which are collectively known as Greater Sentosa. It will also house lifestyle and hospitality developments. We also plan to replace the Sentosa Express to improve connectivity. We will also rejuvenate our beaches and add coastal protection measures, so visitors can enjoy a day on the beach, even as we protect Sentosa from rising sea levels. We will also create new icons in Sentosa, like Imbiah Canopy, which will become a beacon atop Mount Imbiah that leads visitors to heritage buildings and nature trails. We will share more details about our Greater Sentosa Master Plan later this year and I invite the public to share your ideas with us as we continue to reimagine and shape Greater Sentosa.

I would also like to update Singaporeans on our progress to refresh Orchard Road. The historic Emerald Hill will be part of this refresh. We will launch a tender in the coming months to transform 37 Emerald Hill, site of the former Singapore Chinese Girls' School. This will be a mixed-use development featuring unique hotel concepts, lifestyle offerings and community and public spaces.

We are also on track to complete the Grange Road Event Space in the fourth quarter of 2026. The 3,000-capacity venue can host international touring acts and local artistes – bringing live music, community and cultural events right at the heart of Orchard Road.

We are also enhancing our cruise infrastructure and reinforcing our position as one of Asia's leading cruise hubs. In October, we increased Marina Bay Cruise Centre Singapore's capacity, from 6,800 to 11,700 passengers. This enables two large cruise ships to berth concurrently, allowing us to welcome more cruise lines, like Disney Adventure, which will call Singapore home. I look forward to attending the ship's christening this week.

Second, our people. Our tourism workers and businesses shape how every visitor experiences Singapore. We will continue to equip them with the tools to excel.

For example, our Tourism Leadership Excellence and Advancement Programme equips tourism professionals with skills in both tech and sustainability. Our tourism businesses have also been using AI and other tech, and we will help them better use these tools. The Singapore Tourism Board (STB) will unveil the Industry Digital Plans for the Travel Agents and MICE industries, alongside a GenAI Roadmap, at our upcoming Tourism Industry Conference in May.

Finally, we must put on a good show and curate an exciting line-up of events that attract visitors. We continue to be attractive to art lovers. In addition to kicking off Singapore Art Week 2026 in January, we have brought "Botero in Singapore" to Gardens by the Bay. Singapore is the first and only stop here in Southeast Asia.

Like art fans, music fans have been attracted to Singapore over the last few years. This year, they will enjoy acts like BTS World Tour in December, made possible through STB's partnership with HYBE and Klook. It will be BTS' longest-running Asian stop outside of Korea and Japan.

We have also made Singapore an attractive e-sports destination over the years. This year, we will host PGL Major Singapore 2026, the first Counter-Strike 2 Major event in Southeast Asia.

This year's F1 will also be different and more exciting, because we have secured our first ever F1 Sprint event. This means that F1 teams will also compete for championship points on Saturday. We are one of only six circuits to host this in 2026. F1 fans will know it will make our race weekend even more exciting.

Our MICE industry also continues to attract quality visitors and position ourselves to cement Singapore as a business destination. We will host major events this year such as the Passenger Terminal Expo Asia and the RECHARGE Wind Power Summit Asia Pacific. We will host many ASEAN events as chair next year, including the ASEAN Tourism Forum 2027. This is an important event for us to strengthen regional tourism cooperation and showcase Singapore to our neighbours.

Sir, these collective efforts position us as an attractive destination. I will next speak about how we are going to be attractive to startups.

Our startup ecosystem has evolved significantly over the years. Venture capital (VC) funding to startups more than quadrupled in the past decade, from US$1 billion in 2014 to US$4.8 billion in 2024. We are ranked fourth in the Global Startup Ecosystem Index 2025, up from 16th a few years ago. To date, we have over 4,500 tech startups, 220 incubators and 500 VC firms.

As co-chair of the ESR Committee on Entrepreneurship, alongside Minister of State Dinesh Vasu Dash, we have engaged stakeholders across the startup ecosystem to develop recommendations to enhance their access to capital, markets and talent.

Assoc Prof Kenneth Goh asked how we can strengthen pathways beyond capital incentives so Singaporeans of all stages and all groups can venture into entrepreneurship and return to employment without being disadvantaged. We are developing further measures under our committee and we welcome members of the public to share your ideas.

Our committee has been working on ideas to expand startups' access to capital, and I will share how we are doing so.

First, we will set aside $1 billion to expand the Startup SG Equity (SSGE) scheme. This will be to continue to invest into early-stage startups as well as expand into growth-stage deep tech startups.

Today, SSGE supports new and early-stage deep tech startups by co-investing with qualified private sector investors and investing in global VC firms that in turn invest in these startups through a fund-of-funds approach.

One such fund is Matter Venture Partners, a Silicon Valley-based HardTech VC. Matter has invested in early-stage Singapore-based startups, encouraged its portfolio companies to have a strong business and R&D footprint in Singapore, and mentored local startup founders.

SSGE also benefits early-stage deep tech companies like Blue Whale Energy (BWE), which builds and operates a Virtual Power Plant platform, combining its own sodium-ion batteries with edge-based control software to create a flexible energy network. SSGE funding can help BWE crowd in private capital and speed up its development for large-scale deployment in Singapore and expansion into other markets.

Mr Ng Shi Xuan asked about the gap we are trying to close with the additional $1 billion injection. We now have maturing crop of high-potential deep tech startups like Nuevocor, a biotech firm that develops potential life-saving medicines for heart muscle diseases caused by genetic mutations. Nuevocor closed a US$45 million Series B funding round in May 2025 and will enter clinical trials across the US and Europe. Growth-stage deep tech startups like Nuevocor need substantial capital to scale beyond our early-stage support.

This is how we are supporting them.

First, we will directly invest in growth-stage deep tech startups like Nuevocor. This will provide them with the capital they need to scale their operations, strengthen their teams and enter new markets while remaining anchored in Singapore as their home base.

Second, we will invest in global growth-stage deep tech VC funds. By expanding our fund-of-funds approach, we will attract top-tier growth investors to establish their presence in Singapore. They will bring capital, global networks, expertise and deep experience in scaling frontier tech, helping to grow and expand our deep tech startups globally.

Third, we will continue co-investing with third-party investors into early-stage deep tech startups. By sharing risks with credible investors, we will catalyse private capital and strengthen market discipline for our early-stage startups.

Mr Ng Shi Xuan asked if the Startup SG Founder programme only applies to first-time founders. In April 2024, we have made the programme more flexible. While the main applicant needs to be a first-time founder, they can now partner founders who have previous startup experiences to apply.

Dr Neo Kok Beng pointed out that our startups receive great support during the seed stage but face difficulties as they start to mature, due to uncertainty of exit liquidity for investors. To address this, we are strengthening options for companies to raise capital in both public and private markets.

Let me first speak about our public markets.

In 2022, we set up the $1.5 billion Anchor Fund to attract and anchor listings of high-growth companies, including promising startups. We have deployed the bulk of this fund to support companies in their journey towards public listing in Singapore.

We will now launch the second $1.5 billion tranche of the Anchor Fund, or Anchor Fund 2. Like the first tranche, we will co-invest in Anchor Fund 2 with Temasek. This is the second move arising from our ESR Entrepreneurship Committee's work.

This will complement the new initiatives from the Monetary Authority of Singapore's (MAS') Equities Market Review Group, which has seen our equity market achieve some early wins with increased IPO activity and higher average daily trading volumes. Our upcoming SGX-Nasdaq dual listing bridge will also allow eligible companies to simultaneously list on both exchanges with one set of prospectus. I will open NASDAQ's new Singapore Office next week with NASDAQ's management and we look forward to working with the NASDAQ team in the run-up to the launch of the Global Listing Board.

Sir, with these measures, we aim to strengthen our public markets as a compelling choice to anchor growth companies as they raise capital and grow from Singapore. But we recognise that not every company will want to raise capital through our public markets. We must thus help our startups better access private capital to meet their diverse financing needs.

Minister Chee Hong Tat has convened a new workgroup to develop strategies to strengthen Singapore as a leading centre for growth capital. We have met the workgroup and look forward to developing measures to better help our companies raise private capital and pursue other non-public exits.

Sir, together, these initiatives strengthen support for our startup ecosystem, across the growth stages of our companies.

Mr Chairman, I have spoken of how we will continue to make Singapore more attractive to visitors. I have also spoken about how we will continue to make us even more attractive to startups, to founders and to enterprises, by strengthening our startup ecosystem and helping innovative companies thrive and seek funds.

I will now handover to Minister of State Gan Siow Huang to speak about how we are addressing their need for space.

Chairman, I thank Mr Saktiandi Supaat for his interest in Sentosa. Sentosa is just one part – a very important part, of course – of our overall Tourism Strategy 2040. We expect tourism receipts to reach about $47 billion to $50 billion. And this is our key strategy: to attract high quality tourism.

With respect to the Greater Sentosa Master Plan Phase One, which I mentioned earlier, once it has been completed, Greater Sentosa is expected to attract approximately 5.3 million international visitor arrivals in 2045. With all of the different phases that we will be building across the years, many new theme parks and also attractions, I think Sentosa will transform. We welcome Singaporeans and visitors to visit and add to our tourism vibrancy.

To the first point, indeed, as I have alluded to just now on the ammonia study that we have proceeded with, we have actually worked with a local conglomerate where we have moved on to do FEED studies, where not only do we look at ammonia as one possible pathway – and I will tell you why we look at ammonia; I know the Member was talking about hydrogen – because ammonia as a molecule, hydrogen as a molecule, they are both quite well understood. It is just that today, the transportation of green hydrogen is very, very, very expensive and logistically, today, the chains are not established yet.

So, as an intermediary, we will need a carrier and to carry that green hydrogen across, we carry it in the form of green ammonia. So, we are working closely with the Maritime and Port Authority of Singapore because our aspirations are beyond the FEED study, beyond the sandbox. We are hoping that eventually, we could potentially, if we are able to prove the viability and feasibility of that sandbox, we can, not just use that as one form of energy as part of our green hydrogen strategy, but we could also potentially be a bunkering hub in the transportation and the movement of green ammonia from the east to the west.

On the second part, in terms of how we want to help the SMEs. Indeed, we do have plans. For many of these bigger sandboxes, we encourage – whether it is the generating companies (gencos), whether it is large companies – to work locally with our SMEs as well to bring them along. And the point that I alluded to earlier on, on the $800 million Decarbonisation Grand Challenge, is something that we hope to be able to crowd in from the big gencos, the big MNCs, to our local SMEs to bring them along in helping us to decarbonise.

To the third point on renewable energy imports. Indeed, part of that diversification and energy transition resulting in lower carbon alternatives will come with costs. To start off with, we are very mindful of the type of cost pressures and the pain that it may inflict, in fact, that it would inflict on, more importantly, our households and our businesses. So, where we come in is, we try to allow for the low carbon importers to strike up commercial arrangements with the big energy intake customers. So, the likes of, whether it is Google, Amazon Web Services, some of these data centres, we allow them to negotiate and we ring-fence it.

But there will come a time when the Government will work with all of the different sectors alongside with our carbon tax to smear that price along. It will not happen within this very short period of time, but it is also something that we have to take into consideration. And for the longer term, as we move on to decarbonisation, notwithstanding the fact that the natural gas will always be our base, we are, indeed, mindful of the cost of continuing with natural gas, then you have to add the cost of decarbonising that natural gas, the emissions you have to capture – you have to aggregate it, you have to transport it, then you have to store it – these also come with costs.

So, our carbon pricing is a reflection of the true cost of that particular modality of energy generation. And with that, we hope to be able to socialise it across our entire population, our country. The underlying principle has to be how we deal with, first and foremost, through energy conservation and how do we become a lot more efficient in managing peak pricing versus trial pricing.

But those are in the developmental process. We are developing the Virtual Power grid. We are also working on different simulated scenarios. We are also using energy storage systems to ensure that base load is always maintained. I think these are the paths that we will all have to undertake collectively as we move forward. And of course, I look forward to the strong support of Ms Tin and fellow Members of this House as we decarbonise.

— family business, as well as the other one on TACs. On family businesses, I want to assure him that earlier on, when we mentioned that we raised the support level for SMEs and non-SMEs and indeed, many of our multi-generational family businesses are in that category. A quick, quick example, Mr Chairman, three weeks ago, I graced the opening of Guang Xiang Tai's new factory opening —