Singapore to contribute $28 million to IMF to help low-income countries tackle Covid-19 pandemic

The money will go to three initiatives under the International Monetary Fund.
The money will go to three initiatives under the International Monetary Fund.PHOTO: REUTERS

SINGAPORE - Parliament on Monday (April 5) approved a contribution of US$20.57 million (S$27.7 million) to help low-income countries tackle the economic fallout of the pandemic, with Transport Minister Ong Ye Kung stressing that Singapore needs to do its part in an interdependent world.

The money will go to three initiatives under the International Monetary Fund (IMF). These are the Catastrophe Containment and Relief Trust, the Covid-19 Crisis Capacity Development Initiative and the Trust for Special Poverty Reduction and Growth Operations for the Heavily Indebted Poor Countries.

The first two funds aim to provide debt relief for the IMF's poorest member countries and help them meet urgent capacity development needs, while the last involves a US$970,000 grant to support the IMF's US$344 million financing package for Somalia's debt relief.

Announcing the decision last week, the Monetary Authority of Singapore (MAS) said the money will come from its official foreign reserves. The sum is commensurate with Singapore's IMF quota share - a metric which determines the maximum amount of financial resources a member is obliged to provide, and reflects the country's relative position in the world economy.

But Singapore should do more, said Workers' Party MP Jamus Lim (Sengkang GRC). He noted that the country has no foreign or development aid agency, and does not channel any share of its Budget towards official development assistance.

While each country should necessarily prioritise its own needs, generosity has its rewards and uplifting neighbouring countries can pay dividends in the long run, he added, listing several avenues through which this might be done.

Mr Ong replied: "I thank Mr Jamus Lim for supporting this motion, and for giving us this lecture on how, as a small country, it is much better for us to help others.

"In fact, I think what he has just described is over 50 years of foreign policy and one of our key tenets, which is we want our neighbours to all do well."

Singapore's approach is to provide funding commensurate with its size, he added, noting that the country also contributes to the global community by sharing technical expertise with other countries.

The minister also responded to Mr Liang Eng Hwa (Bukit Panjang) and Ms Mariam Jaafar (Sembawang GRC), who asked if it was clear how the funding will be used by the IMF, and suggested that more public education on the topic be done.

The funds are subject to the oversight of the IMF's executive board, on which Singapore is represented, said Mr Ong. He acknowledged that more can be done to raise awareness of Singapore's international contributions.