Among the areas it will look into are developing niche and new markets, maximising land use - perhaps by going underground - and how not to be over- reliant on foreign workers.

In announcing the formation of the committee, Mr Lee said that Singapore's approach to economic development and growth 'remains valid'.

It would remain open to international trade and competition, stay plugged into the global marketplace, build new capabilities and encourage self-reliance.

'But we need to review our specific strategies to develop the different sectors of our economy,' he said.

This involved, among other things, new ways to attract investments and implementing policies to keep Singapore growing faster than developed countries.

There are five broad strategies it will study:

Exploring new growth areas; anchoring global companies here and nurturing home-grown enterprises; attracting talent; creating high-value jobs for locals; and maximising resources such as land and energy.

Chaired by Finance Minister Tharman Shanmugaratnam, its members will be from the public and private sector and labour movement. It will consult widely and canvass a broad spectrum of views.

Details of its work and composition will be released in two weeks, the Finance Ministry said a statement yesterday.

Mr Lee set a timeframe for its work. He wants its main recommendations out in time for next year's Budget.

He was speaking on the third day of the debate on the President's Address which mapped out the Government's priorities for the remaining legislative term.

President SR Nathan's Address was made last Monday, when he opened the second session of Parliament, which went into recess last month. The break was an opportunity for the Government to review the global economic situation and map out its plan for tackling challenges.

Yesterday, Mr Lee did not sugar-coat his assessment. There were tough times ahead, with major changes to the global markets and business climate.

But there would also be new opportunities 'for countries and companies which are fast off their marks'.

'It may be a grave new world for now, as one MP said. But it will be a brave new world after that. Therefore, we have to set the direction for Singapore, at least for the next decade,' Mr Lee explained.

While there is no running away from what will be a 'very difficult year' ahead, he reminded that the Government had mounted a swift response.

These included measures to minimise job losses such as Jobs Credit which subsidises employers' wage bill; and the Skills Programme for Upgrading and Resilience (Spur) which covers worker training.

'We haven't won the war yet,' he said, 'but we've succeeded in moderating the rise in unemployment'.

Singapore's jobless rate rose to 3.2 per cent in March, much lower than in other countries. But there are worries about retrenchments for the rest of the year.

Companies are holding on to workers and hoping for new orders. If not, a second wave of layoffs may be inevitable.

'If the orders don't come in, then the companies will have to let the workers go because they can't sustain short (work weeks) and job sharing indefinitely.'

If the situation persists, companies will have to right-size and workers will have to move on to into businesses which have orders and better prospects.

'From the Government's point of view, if we're in that situation, we have to let companies restructure. We have to let the resources shift from businesses which are shrinking to businesses which are growing, and gear up for the changed new world rather than wait in vain for the old businesses to come back,' he said.

The Government was watching the situation closely and if more needed to be done, it had the resources at its disposal.

He outlined the reviews and updates that were made to long-term policies each time a downturn struck, and said it was no different this time as Singapore prepares for a post-crisis world.

Developed countries will see slower growth for some time, he noted, as economic troubles could lead to growing protectionism - which will impact on Singapore with its open economy.

Trade disputes could also increase, he said, noting that Chinese leaders are so worried about protectionism that they penned opinion pieces extolling the virtues of free trade for Western papers.

While the outlook remains bleak and uncertain, Mr Lee said there are opportunities for Singapore, which is 'not doing badly' in some areas.

It has, for instance, a 70 per cent market share in the manufacturing of oil rigs. And one-third of food giant Nestle's malt extract for the whole world is made here.

But now is also the time to set new economic directions.

With the ESC, Mr Lee was confident Singapore can develop the right strategies to pursue global opportunities.

Mr Inderjit Singh (Ang Mo Kio GRC), who had called for such a review committee was heartened by the move.

'I'm glad it will be a comprehensive review involving the private sector. Tharman has got a track record of having the will to change. I've seen his involvement in first Economic Review Committee and as Education Minister. He's one person who will listen and if it can be done, he will do it,' he said.


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'At the same time, we look closer home and we maximise our win-win cooperation with neighbours. Closest, of course, is just across the Causeway, the Iskandar Malaysia project. I had a good discussion with Prime Minister Najib Razak last week and he is keen to develop our relationship and take it forward and have a forward-looking constructive relationship between Malaysia and Singapore. And I told him I fully agree with this approach and we will try to work together. We must try to work together in these difficult times.'

PM Lee Hsien Loong, on seizing growth opportunities. The Iskandar Malaysia project in Johor is an economic corridor where Singapore is the third-biggest investor.

-end of ST article