SINGAPORE - The pandemic raised concerns about the resilience of global supply chains, but Singapore can work around it by focusing on and developing the regional market, said experts following the Budget speech by Deputy Prime Minister Heng Swee Keat on Tuesday (Feb 16).
This would allow its businesses to leverage the strengths of the various countries within the Asean region, and let it be valuable to the regional supply chain, noted a three-man panel discussing the Budget announcements.
The session live show jointly hosted by The Straits Times and Money FM 89.3 was moderated by Money FM 89.3 presenter Michelle Martin.
On Tuesday, DPM Heng, who is also Coordinating Minister for Economic Policies and Minister for Finance, told Parliament that while the pandemic has seen collaboration across industries and countries in areas such as vaccine development, it has also "accentuated a US-China-centric technology race into a global race for technological superiority and heightened concerns over supply chain resilience".
He said that amid the changes, Singapore businesses must transform and digitalise to plug themselves into the flow of goods and capital.
During the panel discussion, Mr Harvey Koenig, tax partner at KPMG, said this year's Budget has placed an emphasis on developing the regional Asean market.
"For example, Singapore may have the strength in advanced manufacturing, but needs other manufacturing hubs within Asean, for example to supply component parts. So that's where the value of a common market will come in," he said.
The panel also included UOB senior economist Alvin Liew and The Straits Times associate editor Ven Sreenivasan.
Noting this year's expected deficit of $11 billion, Mr Koenig said: "Of course, if you compare it with last year's Budget, it seems small in comparison. But if you look at it in comparison to other Budgets we've had in the past, this probably is the second largest budget deficit in Singapore's history, as far as I can recall."
Mr Sreenivasan said it is the "right Budget for the right time", with this year's Budget more targeted at segments and sectors that really need help, he noted.
"If you're running a karaoke pub, you're not going to get anything. But if you're in aviation, tourism and all, you will get something. So it's very targeted, very tapered, very sensible," said Mr Sreenivasan.
Mr Liew said that the Budget appears to be "as good as you can get", given the various issues that have to be addressed, with the limited resources that are available.
"You have to spend resources due to the pandemic, but at the same time, you can't really ignore that you still have a future to plan out. Against this backdrop, we still have climate change to deal with," he said.
"This is the first Budget for the current government, so it's not a decision that's taken lightly."
He also said issuing bonds under the proposed Significant Infrastructure Government Loan Act will be a more equitable way to fund long-term projects, instead of including them within the national Budget itself.