LABOUR-INTENSIVE INDUSTRIES (Relocation of operations)

[Mr Speaker in the Chair]

Encik Harun bin A. Ghani asked the Minister for Trade and Industry (a) how many labour-intensive industries relocated their operations elsewhere from 1987 to 1991 and (b) whether such movements pose an unemployment problem for Singaporeans, especially those with a lower level of education and skills.

The Senior Minister of State for Trade and Industry (Mr Lim Boon Heng) (for the Minister for Trade and Industry): Mr Speaker, Sir, in the last few years, we have encouraged Singapore-based companies to seek investment opportunities overseas. Our private sector investments in Malaysia increased from 47 million ringgit in 1985 to 859 million ringgit in 1990 (S$42 million in 1985 to S$576 million in 1990). Singapore's investments in Thailand rose from 6.9 billion bahts in 1988 to 15.1 billion bahts in 1990 (S$0.5 billion in 1988 to S$1.1 billion in 1990). These overseas investments do not necessarily give rise to a contraction of Singapore's industries. Many of these investments take advantage of new market opportunities in the foreign countries. Our experience shows that entire industries do not close down operations in Singapore and move to another country. Rather, the industries distribute their activities to other countries to seek out the comparative advantages available there.

Regional investment by Singapore-based companies does not pose an unemployment problem to Singaporeans as we have continued to enjoy full employment. The business linkages built up through the direct investments enabled our companies to widen their marketing, production and distribution networks and upgrade their technological base. As our economy restructures and adapts to the highly competitive international environment, our workers have to upgrade their skills and knowledge. The National Productivity Board has provided many programmes for companies to upgrade their workers at all levels through continued training and education.