Steering through tough times with long and short-term measures

THE global economic slowdown continues to cast gloom on the outlook for many countries. Singapore, by virtue of its open trade economy, is not spared from the volatility ahead. How prepared are companies in bracing for a protracted slow growth environment, and how much government intervention might we see going ahead?

Almost two decades ago during the Asian Financial Crisis, the Singapore government had adopted a cautious wait-and-see approach in the 1998 Budget. Subsequently, off-Budget measures worth some S$2 billion were injected to help reduce business costs and stimulate the economy.

Further calibration was done in November with a S$10.5 billion cost-cutting package. Various short-term once-off measures were introduced, including flexing tax policies to provide rebates on property tax and corporate income tax. CPF contributions were reduced along with tough decisions to cut wages of Singapore civil servants.