Singapore’s digital economy is estimated to reach USD 30 billion by 2025. This growth is driven by the e-commerce and online travel sector which is projected to contribute about USD 11 billion and USD 9 billion respectively by 2025. Further, Singapore has modern physical and digital infrastructure, a strong digital talent base, and robust Intellectual Property (IP) regulations that support a thriving ecosystem.
In this article, we identify five (5) key priority areas in Singapore that indicate the development of the country’s digital economy. These include:
- Building a Secure Digital Ecosystem
- Developing a Vibrant Digital Economy
- Being Digitally Ready for a Stable Society
- Intensifying Research and Development
- Positioning Singapore as a Regional Trade Hub
This article also highlights opportunities where Digital Economy Companies (DECs) with operations in the country are best positioned to support and deliver shared outcomes.
Priority 1: Building a Secure Digital Ecosystem
With increasing reliance on digital technologies, Singapore sees the importance of protecting institutions, companies, and individuals from rising online harms and cyberthreats. The government noted several initiatives to allow Singaporeans to use digital services confidently.
These include:
- Developing new codes of practice that would set baseline standards to create a safer online environment. The Ministry of Communications and Information (MCI) noted that such initiative would cover:
- Child Safety: to protect the young population from harmful content and information;
- User Reporting: to create a responsive mechanism and feedback loop where users and consumers can identify and report harmful content, and for platforms to respond and act on user reports; and
- Platform Accountability: to promote transparency on how online platforms are handling cases.
- Reviewing the current Cybersecurity Act to improve overall awareness, support essential services, and build resilience beyond the critical information infrastructure (CII) sector;
- Increasing the maximum financial penalties for data breaches as provided by the 2020 amendments to the Personal Data Protection Act; and
- Recognising businesses with good cybersecurity practices through a Cyber Trust Mark and Cyber Essentials Mark.
In addition, the Personal Data Protection Commission (PDPC) continues to ensure that privacy legislations are up to date, fits its purpose and keeps pace with technological developments to create a trusted data ecosystem. These initiatives include the launch of a regulatory sandbox for data sharing, participation in international frameworks for enabling data flows such as the APEC Cross-Border Privacy Rules, and a Data Protection Trustmark certification scheme.
Lastly, Singapore is also developing capabilities locally to understand and mitigate potential artificial intelligence (AI) risks. The government continues to work with industry partners to look into AI and data ethics, and to promote the responsible use of AI. Through continuous refinement and calibration of governance frameworks, this allows technological advancement while protecting the public’s interest.
Where DECs may play a part
DECs can help foster a trusted digital environment through participation in public initiatives, embracing cyber ethics, respecting and protecting personal data, and raising cybersecurity awareness in their respective communities. DECs developing technologies specifically for addressing potential risks, such as cybercrime, fraud or misinformation, will find increasing demand for their products and services. DECs can also work with the government to boost innovation, for example through participation in regulatory sandboxes. In addition, DECs can actively partner with regulators to co-create best practices for emerging technologies such as AI and trust-enhancing solutions.
Priority 2: Developing a Vibrant Digital Economy
In Singapore’s Digital Economy Framework for Action, one strategic priority is focused on giving businesses an opportunity to digitalize, particularly highlighting the country’s Small and Medium Enterprises (SMEs). SMEs comprise 99% of all businesses in the country and employ 70% of the workforce, contributing nearly half of Singapore’s GDP. Recognizing that SMEs are the backbone of the economy, the government has several broad-based support programmes for SMEs. These include:
- SMEs Go Digital programme which help SMEs use digital technologies and develop digital capabilities to take advantage of growth opportunities in the digital economy;
- Advanced Digital Solutions scheme which provides AI-enabled and cloud-based integrated solutions for SMEs; and
- Grow Digital scheme which aims to help SMEs access international markets without a need for physical presence overseas.
At the industry level, 23 Industry Transformation Maps (ITMs) are currently being developed to assist the companies to innovate and boost productivity measures in preparation for the future economy. In line with this effort, there are also Industry Digital Plans (IDPs) which provide a step-by-step guideline for digital transformation.
The Singapore government is also committed to sustainable development in technology sectors such as the data centre industry. In 2022, the Infocomm Media Development Authority (IMDA) and the Economic Development Board (EDB) launched a pilot for a Call for Application to construct data centres which prioritise energy efficiency and decarbonisation.
Where DECs may play a part
There is opportunity for DECs to work with the government and SMEs to unlock productivity gains in Singapore’s economy, both domestically and in terms of trade. Smaller enterprises may benefit from mature technologies that boost efficiency and resilience. DECs, including platform companies, can help SMEs digitalise their operations, meet baseline standards for trusted participation in the digital economy, and unlock new markets.
In addition, DECs can play its part in ensuring that its business practices are sustainable and are in line with Singapore’s commitment to a green economy.
Priority 3: Being Digitally Ready for a Stable Society
As technology evolves, it is key for Singapore to continue to upskill and reskill its population. A strong foundation for digital literacy would ensure a future ready society. In line with this, Singapore has announced key initiatives such as:
- Digital for Life (DfL) movement which aims to engage Singaporeans to consider digital literacy as a lifelong learning opportunity. MCI and IMDA plan to partner with the 3P sectors (People, Private and Public) to co-create opportunities to develop digital skills;
- Libraries and Archives Blueprint 2025 (LAB25), as implemented by National Library Board (NLB), promotes lifelong learning and mastery of digital skills through immersive and interactive programmes; and
- Partnerships with industries and Institutes of Higher Learning to increase job access and opportunities in the digital economy.
Where DECs may play a part
DECs can support national, state and local efforts in nurturing digital talent through formal education and upskilling.
Through partnership with schools and IHLs, DECs can offer upskilling support, technical expertise and opportunity for students to gain the literacy, skills and experience to be both confident consumers and well-prepared entrants to the workforce.
Some DECs may also be well-placed to encourage upskilling amongst specific segments of the population that are already on their platforms, such as MSMEs and platform workers. These DECs may distribute bite-sized content, skills certification modules and training to expand access to upskilling and talent development learning opportunities.
Priority 4: Intensifying Research and Development
Singapore deems research and innovation as vital to remain at the forefront of the digital era. The government continues to work with key strategic partners for Smart Nation and Digital Government interests. Efforts for research and development include:
- The Research, Innovation and Enterprise 2025 Plan which aims to develop the country’s science and technology capabilities for a stronger post-pandemic economy;
- The Digital Government Blueprint which highlighted the need to align research and development (R&D) activities towards its Digital Government efforts, including the research facilitation to address current government needs, and seeding future digital capabilities from R&D in research institutions; and
- The Open Innovation Platform (OIP) which is a virtual crowd-sourcing platform that connects “problem-owners and problem-solvers”. Through the OIP, Singapore-based companies can collaborate with startups, companies and research institutes to solve real business challenges and develop innovative solutions.
To promote the development of AI, AI Singapore has been set up to tackle challenges faced in the field and foster new research capabilities. Through AI Singapore, the country has brought together all Singapore-based research institutions and the vibrant ecosystem of AI start-ups and companies to perform research, grow knowledge, create tools, and develop the talent to power the country’s AI efforts. Over the last five years, the country has invested more than USD 500 million for AI Research and Development. To further develop AI capabilities, Singapore injected an additional USD 50 million to attract and develop talent in the field of AI.
Where DECs may play a part
There is great opportunity for DECs to further research and development in the digital economy, both in technology and business model innovation. With their expertise, experience and ability to drive adoption of innovative products and services, DECs are well positioned to provide valuable inputs on policy thrusts, strategies and initiatives.
Priority 5: Positioning Singapore as a Regional Hub for Digital Trade
To seize opportunities in digital trade, Singapore has entered into Digital Economy Agreements (DEA) with several countries. DEAs are a new kind of free trade agreement that deals specifically with establishing interoperable rules in digital trade among countries. DEAs aim to enable cross-border data flows and facilitate innovation in digital business models, while protecting data and maintaining trust in the digital systems. The Singapore government has been an early advocate of DEAs by initiating discussions with like-minded trade partners to align policies and develop a framework for collaboration. Currently, Singapore has concluded negotiations on four (4) DEAs, including:
- Digital Economy Partnership Agreement (DEPA) – with Chile and New Zealand;
- Singapore-Australia Digital Economy Agreement (SADEA)
- United Kingdom-Singapore Digital Economy Agreement (UKSDEA); and
- Korea-Singapore Digital Partnership Agreement (KSDPA)
Given the importance of laying down the foundations of international standards and benchmarks for digital trade, it is expected that Singapore will continue to seek digital partnerships with key economies around the globe.
Where DECs may play a part
DECs stand to benefit from regulatory alignment and cooperation across the region and beyond. They can actively engage with the government so that negotiated provisions of the DEAs are feasible and encourage growth for all stakeholders. DECs can also partner with businesses and institutions in the region to promote a seamless implementation of DEAs, e.g in the areas of cross border payments.
This article is part of a series which covers national-level priorities of SEA-6 economies for digital economy development. As part of the “Tech for Good” study, the Tech For Good Institute also conducted roundtable discussions with policymakers, regulators, industry, and the academia in SEA-6. Summary and key recommendations of Singapore’s roundtable discussions can be found here.
Footnotes:
[1] Southeast Asia-6 markets refers to the six biggest economies in the region, namely Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam
