Steps taken to shore up Singapore's resilience

Singapore's supply chains have been under pressure because of Covid-19, but the Government has been taking steps to shore up its resilience, including boosting stockpiles and diversifying sources of supply.

Singaporeans have a part to play in the effort too, Trade and Industry Minister Chan Chun Sing said.

They need to be able to accept price increases as well as substitutes and alternatives for certain products, he added.

Singapore's supply chains are under pressure for four main reasons, he said in an interview with Chinese daily Lianhe Zaobao on Wednesday.

First, production levels in supplier countries have dropped; second, these countries have also had their own supply chains disrupted; third, some countries have stopped exports owing to political pressure; and fourth, the frequency of international air and sea freight has been reduced.

The Government has taken a five-pronged approach in tackling these challenges.

First, it is diversifying sources of supply, and although this could lead to costlier goods, this is the "price to pay for greater resilience", Mr Chan said in Mandarin. "We cannot guarantee that every product won't have price fluctuations, but for the main categories such as rice and vegetables, we will try to limit fluctuations."

The Government is also boosting stockpiles, ramping up local production for certain goods and also signing long-term contracts with suppliers, he added.

Lastly, Singapore is working with like-minded countries to protect the global trading system, and ensure trade and supply chains remain open during the Covid-19 crisis.

The goal is to safeguard the resilience of global supply chains, he said, noting that having domestic production is no guarantee of self-sufficiency.

Citing domestic mask production, Mr Chan said Singapore still had to rely on other countries for raw materials to produce the masks. Small countries like Singapore need to rely on trade and cooperation with other nations for the necessities and materials it needs, he added.

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A version of this article appeared in the print edition of The Straits Times on May 16, 2020, with the headline Steps taken to shore up Singapore's resilience. Subscribe