Singapore budget deficit could be good for region beset by Covid-19, says deputy minister

Economists are predicting a deficit of as much as S$8 billion (RM23.87 billion) when the Singapore government unveils later today what could be its biggest annual budget since 2009 in response to the recent Covid-19 outbreak.  I — Reuters pic
Economists are predicting a deficit of as much as S$8 billion (RM23.87 billion) when the Singapore government unveils later today what could be its biggest annual budget since 2009 in response to the recent Covid-19 outbreak. I — Reuters pic

KUALA LUMPUR, Feb 18 — There could be a silver lining to Singapore’s Budget 2020 for other Asian countries affected by the Covid-19 outbreak, Ong Kian Ming says.

Economists are predicting a deficit of as much as S$8 billion (RM23.87 billion) when the Singapore government unveils later today what could be its biggest annual budget since 2009 in response to the recent Covid-19 outbreak.

In an interview with Bloomberg yesterday, the deputy international trade and industry minister said this might encourage financial markets to be more tolerant should other Asian countries deviate from their fiscal targets.

“In a context where a lot of countries in the region are announcing stimulus packages, and Singapore will probably have its first budget deficit since the crisis, so first time in over 10 years, I think the market would be more willing to accept any deviations in the expected budget deficit,” Ong was quoted as saying by Bloomberg.

He also noted that Singapore’s annual budget could pave the way for other countries, which are also fighting Covid-19 within their borders, to make similar announcements in the near-future.

“It could make markets less twitchy about possible changes in any deficit targets experienced by other countries in the region,” he added.

Malaysia is set to reveal its Covid-19 stimulus package on February 27. By doing so, it is joining other countries like China and Hong Kong that have already pledged extra fiscal measures to counter the economic repercussions of the epidemic.

Related Articles