A steep slump as the Singapore economy contracted by 13.2% year-on-year in Q2, 2020. This makes for our worst quarterly performance on record as Singapore narrowed its economic forecast for 2020 to a contraction between 5 and 7%.
Grim outlook. It reflects the devastating impact of Covid-19 as well as the deeper forces reshaping the global economy, and our position in the world.
Minister for Trade and Industry Mr Chan Chun Sing warned that Singapore cannot afford to wait out the coronavirus crisis, as permanent changes mean that there will be no going back to a pre-Covid-19 economy. He shared that he knew some are still hoping for a quick recovery and a return to the familiarity of the old normal, but the ‘painful truth’ is that we are not returning to a pre-COVID-19 world.
This is the crisis of our generation. Recovery, when it comes, will likely be a turbulent one. Just look at the recurring waves of infection and disruption we are seeing globally.
During the Asian Financial Crisis and Global Financial Crisis, Singapore persevered, and we saw light at the end of the tunnel after many painful months. Unfortunately, the reality is that it doesn’t look like there will a swift recovery this time round. A strong collective effort will need to be established.
We will have to forge a new path and start now to build a new economy and to create more opportunities for our businesses and workers. Staying still is not an option despite the uncertainties ahead.
In the days ahead, businesses will be opened in a safe and sustainable manner. Cautiously.
Regardless of the sector they are in, our businesses and workers would be supported as they adjust to the new world. This also requires effort from every Singaporean to do their part to be open to new opportunities and to be proactive in upskilling. The new skills gained will allow us to be ready when the recovery comes.
The right macro conditions need to be established to preserve our ability to compete globally. This is key as we forge a new path in this uncertain economic climate.
When our tiny red dot became an independent country in 1965, we had few friends and negligible natural resources. How did we become one of the world’s greatest financial centres? How did we go from Third World to First? The strategy, according to our beloved first prime minister, Mr Lee Kuan Yew, was to develop Singapore’s only available natural resource: our people. Still relevant today.
The world is facing chaos like many of us have never seen before, we need to chart a new path that will take our people out of the storm. The normal that we knew? It doesn’t exist anymore.
The days ahead will be tough, our economic forecast will be dampened, but have faith that we are in a far more advantageous position than our forefathers and many other countries. We can fight this, Singapore, but we need to be more united and resilient than ever.