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Economist at UOB Group Barnabas Gan reviewed the recent decision by the government to pump in extra stimulus aimed at fighting the impact of the coronavirus pandemic.

Key Quotes

“Singapore’s Finance Ministry has introduced additional measures in the fight against the COVID-19 pandemic. Given the ‘rapidly changing situation’, the government will add another S$8.0 billion to cushion the negative economic impact.”

“The measures centre on three key aspects: (1) support jobs and create new employment opportunities, (2) provide support for the sectors that were hit the hardest, and (3) to position Singapore to seize growth opportunities in a postCOVID-19 world.”

“There will be no drawdown from past reserves to finance this additional expenditure. Instead, it will be funded by reallocating monies from other areas, such as development expenditures that were delayed due to COVID-19. Do note that a planned draw-down of S$52.0 billion from reserves had been previously approved.”

“We recognise three key takeaways from the announced measures. First, Singapore’s job market will likely stay weak despite the extension of the Job Support Scheme. Second, Singapore needs to adapt to the evolving economic landscape, given the acceleration of the digital shift amid a reconfiguration of the global supply chain. Third, there are still bright spots in Singapore’s economy despite the current economic slowdown.”