Singapore’s transformation from a third-world country to a global business hub is a story of strategic foresight, visionary leadership, and consistent government support. A critical pillar of this success has been the government’s role in nurturing entrepreneurship, innovation, and industry development through various business grant schemes. These grants have evolved over the decades to meet the changing economic landscape and to keep Singapore globally competitive.
This article explores the history of government grants for businesses in Singapore, tracing their evolution from early industrialisation efforts to the modern digital economy.
The Early Years: 1960s–1970s – Industrialisation and Export Orientation
Following independence in 1965, Singapore faced significant challenges—limited natural resources, high unemployment, and a small domestic market. To overcome these, the government turned to industrialisation as a key economic strategy.
Economic Development Board (EDB)
Established in 1961, the Economic Development Board (EDB) was tasked with attracting foreign investment and developing key industries. While formalised grant schemes were limited in the 1960s, the EDB provided financial assistance in the form of tax incentives, pioneer status, and infrastructure support for companies setting up manufacturing operations in Singapore.
By the 1970s, Singapore’s focus shifted from labour-intensive manufacturing to capital- and skill-intensive industries. The government introduced targeted incentives to encourage local firms to improve productivity and adopt technology.
1980s – Supporting Local Enterprises and Productivity
With rising labour costs and global competition, Singapore realised the need to help local enterprises become more productive and competitive.
National Productivity Board (NPB)
Formed in 1972, the National Productivity Board (NPB) launched several schemes in the 1980s aimed at boosting productivity, including subsidies for training, automation, and consultancy services.
Skills Development Fund (SDF)
Launched in 1979, the Skills Development Fund (SDF) remains one of the longest-running funding mechanisms. It was created to support workforce upgrading, and businesses could tap into it for employee training subsidies, especially in manufacturing and services.
1990s – Internationalisation and SME Growth
As Singapore’s economy matured, the government began to place greater emphasis on small and medium-sized enterprises (SMEs) and international expansion.
Local Enterprise Technical Assistance Scheme (LETAS)
One of the pioneering SME support schemes was the LETAS, which provided funding for consultancy projects to help local firms improve business operations, design, and innovation.
Internationalisation Finance Scheme (IFS)
In partnership with banks, IFS helped Singapore companies obtain financing for overseas expansion. This marked a growing trend in encouraging local businesses to venture abroad and build global capabilities.
2000s – Innovation, Technology and Start-Up Boom
The 2000s saw the dawn of the knowledge economy. As globalisation intensified and the digital era emerged, Singapore shifted its focus toward innovation, R&D, and entrepreneurship.
SPRING Singapore and Enterprise Development
SPRING Singapore, formed in 2002 (formerly Productivity and Standards Board), became the primary agency for SME development. It launched several grants:
- Innovation & Capability Voucher (ICV): A simple voucher scheme that offered up to $5,000 for consultancy in areas like HR, finance, and productivity.
- Technology Innovation Programme (TIP): Provided co-funding for local R&D and product development.
MDA & IDA Grants for Tech Start-ups
Agencies like the Media Development Authority (MDA) and Infocomm Development Authority (IDA) introduced various start-up and media grants, laying the groundwork for what would become Singapore’s vibrant tech ecosystem.
2010s – Smart Nation Push and Enterprise Transformation
The 2010s were marked by Singapore’s Smart Nation initiative, which accelerated digital transformation across all sectors. Government grants were consolidated, enhanced, and digitalised for easier access.
Enterprise Singapore
Formed in 2018 through a merger of SPRING Singapore and International Enterprise Singapore (IE Singapore), Enterprise Singapore (ESG) became the lead agency to support SMEs and start-ups.
Key grants introduced or expanded during this period included:
- Enterprise Development Grant (EDG): A flagship grant covering up to 80% of qualifying costs for projects in innovation, productivity, and market expansion.
- Productivity Solutions Grant (PSG): Introduced in 2018, it supports sector-specific IT solutions and equipment, making it ideal for digital adoption.
- Startup SG: An umbrella branding for various start-up support schemes, including equity co-investments, founder grants, and accelerator support.
SkillsFuture
Although not a direct business grant, SkillsFuture, launched in 2015, allowed businesses to access subsidised training for their workforce, encouraging lifelong learning and upskilling.
2020s – COVID-19 and Business Resilience
The COVID-19 pandemic drastically disrupted global and local businesses. In response, the Singapore government introduced unprecedented support packages totalling over $100 billion, a large portion of which went to grants and wage subsidies.
Temporary Relief Grants
Some of the temporary grants and support schemes included:
- Jobs Support Scheme (JSS): Wage support to retain local employees.
- Rental Support Scheme and Digital Resilience Bonus: Helping businesses, especially in F&B and retail, go digital quickly.
- Enterprise Financing Scheme (EFS): Enhanced to provide liquidity support.
These grants were critical in keeping businesses afloat during lockdowns and economic slowdowns.
Post-COVID Recovery and Future Directions
As Singapore emerges from the pandemic, the government continues to prioritise innovation, sustainability, and digital transformation.
Green Grants and ESG Focus
Sustainability is now a key pillar of economic strategy. Grants supporting Environmental, Social, and Governance (ESG) initiatives include:
- Energy Efficiency Fund (E2F): Helps companies improve energy efficiency.
- Enterprise Sustainability Programme (ESP): Supports SMEs in going green and building sustainable business models.
GoBusiness Gov Assist Portal
To simplify access to grants, the government launched the GoBusiness portal, a centralised platform where SMEs can discover, apply for, and manage grant applications online.
Conclusion
Over the past six decades, Singapore has consistently adapted its grant frameworks to support businesses through changing economic landscapes—from industrialisation and productivity drives to digital transformation and sustainability. These grants have been instrumental in nurturing SMEs, promoting innovation, and attracting foreign investment, making Singapore one of the easiest places in the world to do business.
The government’s unwavering commitment to supporting businesses, especially in times of crisis like COVID-19, has solidified its role as an enabler of enterprise growth. As the economy shifts towards a green and digital future, Singapore’s grant ecosystem is expected to remain a cornerstone of its competitive advantage.