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The thriving tech sector in Singapore is the product of a range of converging factors. At the crossroads of Asia's biggest markets, the city-state has a prime location, low company taxes, a well-developed Business infrastructure, strong investment opportunities, and a robust regulatory regime. Much credit goes to the Singapore government for these strengths.
The approach of the government is to combine business-friendly policies with large investments in the tech sector.
It has a continuing commitment to keep research and development (R&D) spending at 1% of GDP and as part of its Research Innovation and Enterprise (RIE 2020) plan, has recently said they will invest S$ 19 billion (almost US$ 14 billion) in scientific and technological research.
Funding is invested according to a clear strategy that Chan Cheow Hoe, Chief Government Digital Technology Officer, helps to devise. Chan was the Chief Information Officer (CIO) of the government previous to being appointed to the role in November 2018.
Singapore’s tech ecosystem
Singapore is best known for its fintech landscape and over the next five years the Monetary Authority of Singapore has put $225 million to develop the industry, but the government has also pushed the start-up ecosystem to diversify.
By developing a dedicated data science consortium, the government is particularly required to build an artificial intelligence (AI) hub in the country and will invest $150 million in the industry research.
The advantage of Singapore is that it welcomes everybody, and there is heavy government support.
The approach of the government isn't without its issues. The allocation of allocation funding has been criticized for imprudence and corruption, Singapore has earned a good reputation as an easy place to start a business, but a difficult choice to scale it.
A study on high-tech startups in the country was completed by the National University of Singapore Entrepreneurship Centre (NEC) in 2017, which revealed that precious few startups generated fast and profitable growth, while 56.8 percent of startups struggled to scale and generate employment.
Nevertheless, their 53 percent five-year survival rate was better than businesses in the UK and the US, which means that they get the encouragement to keep going but do not take the risk of making big breakthroughs.
During a roundtable interview, NUS Enterprise director Dr. Wong Poh Kam told Tech in Asia that some money spent on research should be redirected to building products.
There is a no-land man's where the work can no more be funded as research, but there is no market-ready product," he said." "We're wasting too much money on research, but perhaps we should think diverting some of it into translation."
There is still optimism about the digital future of Singapore. As evidenced by the policies and initiatives recently announced, the government remains committed to the tech sector.