Pockets of strength for S’pore despite weak global economy
The weakened global economy has dampened consumer and business confidence, but there are pockets of strength in the Singapore economy, Trade and Industry Minister Chan Chun Sing told the House.
There will also be immediate challenges to weather, he noted, adding that the country's medium-term outlook will be determined by factors such as the trade conflict between the United States and China.
In addition, there is a need to "navigate more fundamental shifts in the global economy that will shape our medium- to long-term prospects", he added, in reply to six MPs' questions on the economy.
One key challenge: Stresses to the multilateral trading system that Singapore has long benefited from.
"The risks of economic balkanisation, where markets are fragmented and bifurcated, and where trade, talent and data flows are disrupted, have grown," he said.
Another challenge is the emergence of global rules that might affect Singapore's status as a global hub. For instance, ongoing discussions to have minimum effective tax rates across countries will affect the Republic's competitiveness. Carbon caps will constrain its growth potential.
Mr Chan also noted the US-China dispute has gone beyond retaliatory tariffs to areas such as restrictions on technology access and sales. There is also the risk of a disorderly Brexit and political uncertainties in some regional economies.
"All these have dampened consumer and business confidence," he said.
"Lower demand in our key export markets has in turn affected our outward-oriented sectors such as electronics, precision engineering and wholesale trade, whose performance remains weak."
But there are pockets of strength, particularly in the information and communications sector.
Mr Chan outlined the country's three-pronged strategy to tackle economic uncertainties.
First, Singapore will strengthen the fundamentals that have set it apart from competition, such as its stable political environment and connectivity in supply chains and distribution networks.
Second, it will constantly refresh its business offerings.
Third, Singapore will do its part to promote a conducive global and regional business environment.