Budget 2025: Singapore enters next phase of growth amid ‘a new global contest’
Pressures will reshape worldwide economy and dampen prospects for growth, says PM Wong
SINGAPORE will face a new global contest, with greater uncertainty and downside risks as it moves into its next phase of growth, said Finance Minister Lawrence Wong in his Budget speech on Tuesday (Feb 18).
Wong, who is also the prime minister, noted that Singapore has “done well so far”, bouncing back from the Covid-19 pandemic and ending 2024 on strong footing.
The economy grew by 4.4 per cent, as inflation continued to ease and wage increases outpaced inflation. Income inequality after government taxes and transfers was also at its lowest since 2000.
However, PM Wong expects there will be pressures that will reshape the global economy and dampen prospects for growth worldwide.
The US and China are “locked in a fierce contest for global supremacy”, with neither side wanting to come to blows, he said.
“Both know that economic heft and technological prowess are key to winning the global race, and both are prepared to take more assertive actions to advance their own interests, even at the expense of established international norms.”
There will likely be escalating attempts at containment and counter-containment, with ripple effects for other countries including Singapore.
“As a small and open economy, we will feel the impact,” PM Wong said.
For 2025, he expects a more moderate outlook, with growth projected at between 1 and 3 per cent, and inflation averaging between 1.5 and 2.5 per cent.
For more Budget stories, visit businesstimes.com.sg/singapore-budget-2025
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