By Francis Chan

THE Singapore Government is giving small and medium-sized enterprises (SMEs) a $200 million boost to help them through the dark days of recession.

The money can be used to fund a range of projects, including upgrading IT systems, designing new products or devising new branding.

Called Business Upgrading Initiatives for Long-Term Development (Build), the scheme will increase funding assistance for what are termed 'capability development' programmes.

And to ensure that Build reaches out to as many SMEs as possible, it will focus its efforts on two fronts when it is launched tomorrow by Spring Singapore - the first will address individual SMEs and the second is designed for industry-level assistance.

For individual SMEs, Spring will increase funding support from 50 per cent to 70 per cent.

For industry level projects, Spring will raise funding support from 70 per cent to 80 per cent under the umbrella of an older scheme - the Local Enterprise and Association Development (Lead) programme.

Minister of State for Trade and Industry Lee Yi Shyan said that Spring's funding for such capability building programmes had paid off in the past.

'Over the past year, these programmes have helped some 2,600 businesses to upgrade their capabilities.

'Many have become leaner and stronger. Others managed to increase sales with more effective design and branding.'

Local eyewear specialist Nanyang Optical was one of the firms which benefited from a research and development (R&D) programme jointly supported by Spring and A*Star.

According to Nanyang Optical's managing director, Mr Yang Wah Kiang, funding from the programme helped with product innovation and opened doors to new markets.

'Through Spring's capability programme, we were able to venture into the European market where we distributed our own brand of eyewear. This included unique eyewear innovations, such as frames without screws or hinges, and even eco-friendly eyewear,' said Mr Yang.

Similarly, the Lead programme has been tapped by several industry associations since it was launched in 2005 with an initial kitty of $50 million.

Mr Lee said that the initiative had been particularly successful for the furniture sector.

'The Singapore Furniture Industries Council (SFIC) launched the $1 million 3rd Member Assistance Scheme (MAS), which helps eligible members lower costs and strengthen business capabilities.'

The funds under MAS are used to help eligible SFIC members build capabilities, lower business costs, and explore new business opportunities through overseas trade missions.

Between March 2007 and November last year, Lead funding subsidised trade missions for local furniture companies to showcase their products in places such as New York and Milan, as well as south China and Russia.

This article was first published in The Straits Times on February 10, 2009.