Tharman: Singapore's Productivity Growth on Track

At the launch of a new cash-payment system at Cold Storage supermarket on 29 Oct, Deputy Prime Minister  (DPM) Tharman Shanmugaratnam said that Singapore is “well on track” to raise productivity growth-targeted at 2 to 3 per cent per annum over the decade from 2009. 

"If you take us for the first five years, which is 2009 to 2014, we are well on track... In fact, we are at the upper end of the 2 to 3 per cent range," he said.

Mr Tharman added that contrary to popular belief that “productivity has not worked”, “actually we are very much on track”.

It would not be possible to get the same growth rate every year. “It jumps up and down and it’s highly cyclical,” he said. “(But) productivity today is significantly higher than when we started in 2009.”

Concurrently holding the position as Chairman of the National Productivity Council (NPC), Mr Tharman however, noted that there are two disappointments:
1)      Much of the productivity gains were front-loaded in the first two years with little progress since then; and 
2)      The purely domestic sectors, e.g. construction, retail and food services did not fare as well as the export-oriented part of the economy.

“Which is why what is happening here is so important”, he said, referring to Cold Storage’s new cash system and other moves to raise productivity.

Mr Tharman called on local shoppers to “shift their habits” towards the self-service route, depicting a future scenario of self-checkout and automated cash systems replicated across the retail industry.

“It will require some incentive…but the more people switch to self-checkout…the more the savings will be.”

Cold Storage is encouraging shoppers to use self-checkout systems by giving them a 3 percent discount on purchases. These systems are available at 31 of its 51 stores here.

Mr Tharman also highlighted another issue that needs to be worked on: the use of three card terminals at retail stores’ checkout counters – one for credit cards, another for Nets cards and a third for contactless payment cards.

He added that it is common to find a unified system in overseas markets where one payment terminal is used for all cards. "We want to get that fixed. It is backward to have to rely on three different card terminals," he said, adding that this is something that the Monetary Authority of Singapore and Spring Singapore are working on.

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Source: “Tharman: S'pore on track to raise productivity growth”, (The Straits Times, 30 Oct 2015)

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