SINGAPORE – While the economic challenge caused by the coronavirus outbreak is very grave, the Government will do “whatever it takes” to stabilise the economy, preserve jobs and help companies stay afloat, Prime Minister Lee Hsien Loong said on Friday (March 27).
“Whatever it takes to do that, we will do them,” Mr Lee told reporters as he spoke on the $48.4 billion Supplementary Budget that Deputy Prime Minister Heng Swee Keat unveiled on Thursday.
“We want to see people through this; we are under no illusions that this is the end of the story because nobody can tell what lies ahead,” Mr Lee said in an interview at the Istana.
Giving a sense of the fast-changing situation, Mr Lee said the Government had thought the measures contained in the Budget presented on Feb 18 would buy a few months of time for it to assess the situation and put together a second package.
“But we did not expect within one month, the picture was totally changed – the health picture was totally changed, the economic picture was totally changed,” he said.
This is why the Government also completely changed its policy response and set aside a further $48.4 billion to support businesses, workers and families – a Supplementary Budget nearly seven times the initial $6.4 billion worth of measures to cushion the Covid-19 fallout, said Mr Lee.
While the combined $55 billion to combat the coronavirus is intended to see the country until the end of the year, Singaporeans must be psychologically prepared for things to worsen in the coming months, he said.
In such a scenario, the Government is prepared to tap on the reserves again.
“We have the dry powder,” he said. “If we need to do more, when we need to do more, we will do that down the road.”
Mr Lee noted that economies around the world have been drastically hit as the flow of goods and people reach a standstill. As an open economy, Singapore is particularly hard hit, especially in industries such as aviation, tourism and hotels, he added.
“It is going to last quite a long time: it is not a V-shaped down dip, it is not a U-shaped dip,” he warned.
“If you are lucky, you can sustain it at a diminished level for quite a long time; if you are not lucky, it will keep on going down, and some pieces (of the economy) are going to have a lot of difficulty, just staying in existence.”
The Government’s aim is very clear, he said – to protect jobs and help companies stay in business by reducing their costs. Key industries like aviation will be helped so they can “continue in semi-suspended animation, but able to come back to life when the opportunities come”.
“There will be ups and downs,” he said. “Therefore, it is critical that we go into this eyes open, (with) strong leadership, good government, united and determined to see this through.”
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