(Bloomberg) -- Singapore is looking to add to about S$100 billion ($74 billion) of fiscal stimulus to help strengthen an economy expected to still face significant uncertainty next year, a senior official said.
The city-state will use its budget early next year to deliver more support for the trade-reliant economy, Transport Minister Ong Ye Kung told Bloomberg Television's Haslinda Amin.
“There will be a new budget to be announced early next year -- around February is our timetable -- and definitely you're going to see more fiscal policies coming into play to help uplift the economy during this time,” he said.
The fiscal support delivered so far has helped to cushion businesses and consumers from the effects of the global pandemic, including particularly the battered aviation and hospitality sectors. Yet it won't prevent the economy's record contraction this year, estimated by the government at 5%-7%.
“One major imperative going forward is that we have a fairly widespread and universal jobs support scheme” that helped save jobs, but now the government is “progressively tapering down” stimulus and moving toward encouraging hiring, said Ong, who is also a board member of the Monetary Authority of Singapore, the nation's central bank.
Fiscal Policy ‘Critical'
Fiscal policy is “critical” as central banks globally have little space left to cut interest rates or buy back bonds, he said.
Ong's comments follow the MAS's decision Wednesday to keep its policy unchanged, and latest data showing the economy contracted 7% in the third quarter from a year ago.
“We are still in a fairly deep recession,” Ong said.
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