SINGAPORE — Lingering US-China tensions and recurring waves of COVID-19 infection overseas are two “uncontrollable” factors that could affect the pace of economic recovery, Minister for Trade and Industry Chan Chun Sing said on Monday (23 November).
“We do not yet know how the new US Administration will approach its relations with China. But we hope both sides will dial down tensions, and return to a more open and inclusive global economic order,” said Chan. The minister was delivering his remarks in conjunction with the release of Singapore’s third quarter gross domestic product (GDP) data.
“As I said a few weeks ago, the path forward lies in greater interdependence, rather than independence or autarky.”
As people are increasingly feeling the strain of COVID preventive measures, governments will need to muster greater political will and determination to stem the spread of the virus, Chan said.
New and more frequent lockdowns will have a knock-on effect on global demand, in turn affecting export-oriented economies such as Singapore’s.
He also pointed out that while there is much excitement over the progress of vaccine development, “it will not be the quick fix that many expect it to be”.
“Manufacturing enough doses, then distributing and vaccinating a significant population of the world, will take many months, if not years,” Chan said.
But as long as Singapore manages two “controllable factors well” – its COVID-19 infection rates, and the ability of businesses and workers here to adapt to the pandemic – and mitigate the risks of those beyond its control, Chan said he is confident of a quicker recovery for the city-state.
“We now have the testing capabilities, isolation facilities and healthcare capacity to manage risks from imported cases, to ensure they do not infect the local community.”
This will allow Singapore to gradually reopen its borders, including allowing more Singapore-based business people to travel overseas, bringing in the necessary professionals and workers, and progressively hosting more significant meetings, incentives, conferencing, exhibitions (MICE) events, he explained.
Chan said he will speak more on the issue on Wednesday at the two-day travel tradeshow Travel Revive.
“Domestically, we will also allow more activities to resume. I understand many are looking forward to Phase 3. Whether we call it Phase 2X or Phase 3, what’s more important is to maintain our psychological vigilance to keep up with the prevailing safe management measures,” he added.
Chan also assured Singapore businesses and workers that the government “will not leave anyone behind”, but noted that its support must be “more targeted”.
“Our support measures must be sustainable in the long run. It is not possible for us to indefinitely support business models that are no longer relevant and competitive in a COVID world,” he said.
The government’s support over the last few months has given businesses and workers time to regroup and reevaluate their business models, Chan said.
These groups will continue to get government support to help strengthen their capabilities and expand into new markets with the view of creating good jobs and opportunities for Singaporeans, he added.
Singapore’s GDP fell 5.8 per cent year-on-year in the third quarter, the Ministry of Trade and Industry said on Monday. The revised official forecast is for full-year GDP to contract between 6.5 per cent and 6 per cent.
The economy emerged out of a technical recession during the quarter. It grew 9.2 per cent from the previous three months, compared with the 13.2 per cent decline in the second quarter.
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