Singapore has unleashed US$5.8 billion (S$8 billion) to rescue its economy from further ravages by the untamed COVID-19 pandemic.
Last week, Singapore reported a 13.2 percent contraction in its gross domestic product (GDP) for the second quarter year-over-year – its worst on record. The economy remains in the throes of an economic recession expected to slash its GDP by 7 percent for the full year.
Deputy Prime Minister and Finance Minister Heng Swee Keat announced the massive stimulus on Monday. Heng is also the country's coordinating minister for economic policies.
"The resulting economic impact has been severe," said Heng.
He noted Singapore's export-oriented economy is hostage to a global economy that remains very weak. He said any recovery will depend on how well its foreign trading partners contain the spread of COVID-19.
Among the key stimulus measures announced by Heng are:
* An extension of wage subsidies until March 2021.
* Cash payouts for unemployed Singaporeans; those who have suffered significant income loss and low-wage workers.
* An additional US$136.5 million in relief for the aviation sector.
* US$234 million in "tourism credits" for Singaporeans to encourage domestic tourism.
Heng said Singapore will not draw on its monetary reserves to fund the latest stimulus. He said the government intends to fund these new measures by reallocating monies from other areas. There are no plans to draw on Past Reserves for these measures beyond those earlier approved.
Before Monday's snew stimulus, the Singapore government had launched four fiscal stimulus packages worth more than US$73 billion, or 20% of GDP.
The fourth economic stimulus package worth $23.2 billion (S$33 billion) announced May 26 was used to bolster businesses and households staggering from the massive economic slowdown induced by the pandemic.
Heng said the fourth stimulus package was a landmark package and necessary response to an unprecedented crisis. He announced the new stimulus even as the country reels from 55,800 confirmed cases of the disease. Singapore, however, has only suffered 27 deaths.
More than 90% of all cases (53,000) have taken place in packed foreign workers dormitories housing men mostly from Bangladesh, India, and China.
The concentration of COVID-19 cases among foreigners is shining a harsh light on the city's inequalities and injustices. This fact also explains Singapore's very low death rate, since most patients are young and healthy foreign workers who can quickly recover from the disease.
