The case of Singapore

Abstract

The economic impact of the Covid-19 pandemic on Singapore was more severe and protracted than the global financial crisis. Singapore responded with easing of the monetary policy stance, reinforcing financial stability, helping individuals to reduce debt obligations, easing business cashflow constraints, adjusting financial regulatory and supervisory protocols to cope with immediate challenges, and enabling the financial sectors to build long-term capabilities. Fiscal responses were unprecedented with four consecutive budgets and two ministerial statements, initially focusing on immediate assistance in respect of jobs, businesses, households, and later refined to providing more sector-specific assistance as the pandemic evolved with more detailed information available, and preparing for post-pandemic recovery and growth. Singapore has accumulated sufficient reserves over the years, which are a strategic asset, enabling it to tackle the negative impact of the pandemic without incurring national debt, thanks to the fiscal prudence and sustainability institutionalized in the constitution. Together with decisive public health measures to curb the spread of the virus, the monetary–fiscal policy mix has been appropriate so far, and the eventual long-term policy effectiveness and transformation of the small and highly open economy of Singapore depend hugely on the global containment of the pandemic, the effectiveness and allocation of the vaccine, and the pace of global economic recovery. © 2022 selection and editorial matter, Bernadette Andreosso-O’Callaghan, Woosik Moon and Wook Sohn;individual chapters, the contributors.