Govt ready with package to help businesses, workers in event of sharp economic downturn: Heng Swee Keat

Deputy Prime Minister Heng Swee Keat said the Cabinet has been discussing the recent slowdown of the global economy and that the Government will act if the situation turns bad.
Deputy Prime Minister Heng Swee Keat said the Cabinet has been discussing the recent slowdown of the global economy and that the Government will act if the situation turns bad.PHOTO: MCI

SINGAPORE - A package is ready to help Singapore businesses and workers should the global economy take a nosedive, said Deputy Prime Minister Heng Swee Keat.

Noting that the trade row between China and the United States has cast a pall on the global economy, he said the Cabinet has been discussing the recent slowdown and that the Government will act if the situation turns bad.

"We always have to be prepared," he added.

He made these points in an interview with visiting Malaysian journalists last Saturday (July 27), a fortnight after flash estimates showed Singapore's economy grew only 0.1 per cent in the second quarter of this year, the lowest in a decade and well below analysts' expectations of 1.1 per cent.

Mr Heng, who is also the Finance Minister, did not give details of the package during the interview, a transcript of which was released to the media on Monday (July 29).

Singapore's financial regulators have also been keeping a close eye on the movements of global financial markets, where investors are "a lot more jittery than before".

"We have to be alert to all these changes that are happening," he said, and to be prepared for the worst while hoping for the best, he added.

But Singapore is not expecting a full-year recession at this point, Mr Heng had said earlier this month.

During the 2008 global financial crisis, the Government pledged $2.9 billion to help workers and businesses cope with the downturn, followed by a further $20.5 billion Resilience Package in January the following year. The money was pumped into saving jobs, stimulating bank lending and enhancing business cash flow, among other measures.


The eight Malaysian journalists, who met Mr Heng as part of this year's Malaysian Journalists Visit Programme, also asked for his views on issues such as the relationship between Singapore and Malaysia, domestic politics, and disputes in the South China Sea.

Television outlet Astro Awani asked Mr Heng about his approach to sensitive topics such as Pedra Branca or the water issue, especially since Malaysian Prime Minister Mahathir Mohamad is “normally quite aggressive” about them.

Mr Heng said that Prime Minister Lee Hsien Loong had a “very good meeting” with his Malaysian counterpart at the Malaysia-Singapore Leaders’ Retreat in April, at which he was also present.

“I think that is an agreement on both sides to work on contentious issues, and that as long as we work on the basis of a win-win outcome and work on the basis that we abide by international rules and norms and regulations, I think we can find practical ways to resolve any differences,” he said.

For instance, all countries involved have accepted the International Court of Justice’s judgment on Pedra Branca.

Asked how he would describe the relationship between both countries, Mr Heng said there are areas of difference, but also a willingness to look at areas where both countries can cooperate. He added that differences between such close neighbours will crop up from time to time. 

"What is important is for us to resolve this as objectively and rationally as possible," he said. "It is important for us to see the broader strategic picture, which is, by cooperating with one another closely, we can actually achieve more together."

He said Malaysia and Singapore, along with the rest of the Asean nations, can work together to maintain regional stability and relevance, boost economic development and build stronger ties between their peoples.

Peace and stability are critical for future development, he said, stressing the importance of establishing a "clear vision of where Asean is going and how Asean can maintain its relevance on the global stage".

"Asean member states do not want to take sides in any major disputes between the big powers," he added. "But we are open to working with everyone who wants to achieve win-win outcomes with Asean and Asean member states."

For economic development, Asean states need to build on what has been established under the Asean Economic Community, and seize opportunities in areas like the digital economy, he added.

Another important area of cooperation is to forge a deeper understanding among the people in Asean, whether it is between business groups, academics or students.

He also stressed the importance of working out a code of conduct regulating activities in the South China Sea which all parties can agree on, adding that it is important that they do all they can to avoid escalating tensions.

"Peace and stability is fundamental to the development of our economy and to the development of better relations," he said.