Building a Stronger Financial Sector for Economy Growth
It is the duty of the monetary authority of Singapore to build a strong financial sector because they contribute significantly to the economy’s growth.
Supporting of start-ups
Many of the powerful economies of this world have come to the realization that start-ups present the biggest opportunities for economic growths because of their financial contribution. They have made the economy to have a boom because of their contribution and optimism. The government of Singapore can promote start-ups by exempting them from taxes in the first two months, and this will motivate them thus making them inject their profits back to the business thus maintaining a steady cash flow in the economy. The government should also give these start-ups mentors who will guide and correct these start-ups so that they can grow together.
Financing of SME’S
Small and medium enterprises act as a source of employment for most people who are not employed. It, therefore, helps to deal with the issue of unemployment in a country and enhancement of entrepreneurial skills which leads to enterprise development. They also lead to innovation and productivity growth because their founders invent new products which are rolled out into the market. However, the greatest challenge facing them is a lack of adequate financing to advance their businesses. SMe’s mostly rely on personal savings to finance their activities rather than banks because banks need a financial history as well as collateral.
Improving the technology infrastructure
Adoption of technology is a primary strategy that start-ups especially SME’s need to consider. This is because it increases efficiency as well as improves on customer service. Nonetheless, it is a costly affair. Therefore the government of Singapore invests heavily in technology in the enterprises. This is so as to drive change which consequently will have a positive impact on the economy of the country.
Facilitation of electronic trading of financial assets
This is the fundamental pillar of any successful capital markets of a given country. Therefore, the monetary authority of Singapore should create an electronic platform. This platform will allow banks and other financial institutions in Singapore to trade in financial assets. This will help open up Singapore regionally and also internationally making investors develop an interest in trading in Singapore’s market. This will improve the cash flows of the country thereby being a significant boost to the country’s economy.
All these roles if executed by the monetary authority of Singapore will lead to the growth of the economy. Thus increasing the gross domestic product.
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