Investing in new areas, in good times or bad

AS Singapore Budgets go, the latest fiscal package - aptly dubbed "Emerging Stronger Together" - pretty much ticks all the boxes for a trademark response for these times, when the economy has come through a bruising battle but it's still far from certain that the difficulties and dangers have gone away.

The financial plan not only caters to immediate needs, with an S$11 billion in continued relief for workers and businesses that are still struggling from the Covid-19 big hit, and to support public health and safe reopening. But in quintessential Singapore style, Budget 2021 is firmly focused on the future: Not just the next three years - over which S$24 billion will be set aside to gird up firms and workers, particularly to innovate, transform and scale up globally - but well beyond, to lay the groundwork for a sustainable long term. In fact, the plans outlined in Deputy Prime Minister Heng Swee Keat's 45-page Budget statement for Singapore to emerge stronger amount to a FY2021 war chest of S$107 billion.

Having committed nearly S$100 billion through five budgets last year to deal with a debilitating pandemic and its worst ever recession, Singapore unsurprisingly notched up as well its biggest budget deficit in FY2020: S$64.9 billion, or almost 14 per cent of GDP. It might have seemed fiscally prudent to ease off a little on the spending plans this year, with relief support scaled back for all but the hardest hit sectors, and expansion of big industry transformative initiatives put on the backburner.