SINGAPORE: As an open economy that is heavily dependent on trade, Singapore cannot expect to be insulated from the current challenging global environment, said Minister for Trade and Industry Chan Chun Sing on Sunday (Aug 4).
Mr Chan, who is Member of Parliament for the Tanjong Pagar GRC, was speaking during a National Day event at the Tanjong Pagar Community Club.
AdvertisementAdvertisement"As I was preparing my speech, our downside risks have increased further, with the resumption of the US-China tariff war … the trade spat between Japan and Korea, and the ongoing situation in Hong Kong," said Mr Chan.
He also said that the Government is monitoring developments closely and "stands ready to support" citizens, particularly the most vulnerable, should conditions worsen.
But Mr Chan said that "to deliver the right medicine, we must first be clear about the cause of the illness".
He said the current situation is unlike the Asian Financial Crisis and Global Financial Crisis, in which Singapore's economy experienced sharp, but short downturns triggered by a sudden loss of confidence in global financial markets.
AdvertisementAdvertisement"The current situation is driven by weaker external demand and a deepening downturn in the global electronics cycle, exacerbated in part by the uncertainties caused by the US-China trade conflictand the various other issues that I mentioned. All these havedented business and consumer confidence globally.
"The downturn in electronics has also spilled over into related sectors like precision engineering and wholesale trade," said Mr Chan.
"We have seen these cycles before, and should not pani?c," said the minister. "There are still?????? bright sparks within our economy in the infocomm industries, in the professional industries and so forth."
What complicates the situation, he said, are "structural changes taking place at the same time", including a pullback from globalisation and erosion of the multilateral trading system, including institutions like the World Trade Organization.
"All these (mean it) will take a much longer time for the global economy to settle into a new equilibrium," he said, adding that Singapore would need fresh strategies.
"TARGETED, LONG-TERM PERSPECTIVE"
In his speech, Mr Chan championed a "targeted and long-term perspective" in Singapore's strategies, even as it tackles short-term challenges posed by the external environment.
He said Singapore must continue to build upon fundamentals, promoting a "stable and pro-business environment based on the rule of law", staying well-connected to markets in fast-growing Asia and building a skilled workforce.
"These fundamentals are the reasons why we have been able to maintain our competitiveness and attract high-quality investments for the long term," said Mr Chan, citing those by ExxonMobil, GSK and Neste.
But "we must never be complacent", he said, suggesting that Singapore intensifies its efforts by continuing to diversify our markets' supply chain and distribution networks.
"We must never, never be held ransom by any single market, or any single source," he said.
In his speech, Mr Chan also warned against "taking the easy way out and shirking our responsibilities to build a better future for the next generation.
"What we must do is to make sure that whatever measures we implement to help our businesses and people are sustainable, and not short-term measures just to artificially boost demand," he said.
"WE HAVE CONSTRUCTIVE POLITICS"
Mr Chan noted that one of the most important factors that has allowed Singapore to achieve so much over the last 50 or so years is that "we have constructive politics and a coherent government".
"Constructive politics is about bringing people with different aspirations, different capabilities, different concerns coming together to achieve for themselves and for Singapore.
"Constructive politics is not about dividing ourselves against one another, or not to champion our respective personal agenda at the expense of the national agenda," he added.
In conclusion, Mr Chan shared his thoughts on the issues of fairness, accountability and transparency.
"The hallmark of our political system is this: We have always been transparent and honest with our people on our challenges, opportunities, trade-offs and options.
"A responsible government must never shirk from our responsibility to share frankly and openly our challenges with our people no matter how tough those conversations must be," said the minister.
"We are an accountable government. Accountability means that we are not just accountable to this generation but to future generations. Being accountable means we run a fiscally prudent system and not leave debts to our children to pay.
"Being accountable means that we do not just think short-term but also long-term. If climate change is going to threaten our shoreline in Tanjong Pagar, then we must make sure that we invest today to make sure that our children will not be robbed of their homeland because of climate change.
"Being accountable means that we build a system based on honesty, integrity and incorruptibility. It means that we leave behind a better system for our children to enjoy," he added.
Mr Chan said fairness means allowing every Singaporean child to have "the best chance to succeed in life and fulfill their potential".
"Each and every Singaporean, we mean that - each and every Singaporean regardless of race, language, religion, regardless of ancestry or connection."
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