Challenges Amid Global Uncertainty Highlighted at Business Summit
Singapore’s economy is projected to grow between 3 to 5 per cent in 2022, but Finance Minister Lawrence Wong cautioned that the risks of recession or stagflation cannot be ignored. Speaking at the Singapore Apex Business Summit 2022 on Tuesday (Mar 22), Wong attributed the uncertainties to the ongoing crisis in Ukraine, which has disrupted global supply chains and exacerbated inflationary pressures.
Global Risks and Local Resilience
While growth remains the baseline assumption, Wong acknowledged that a prolonged or escalating conflict could impact global and local economic conditions. Despite Singapore’s limited direct ties to Russia and Ukraine, the ripple effects on supply chains and inflation could significantly influence the city-state.
“If the global economy stagnates amid high inflation, Singapore would feel the impact,” he said during a discussion moderated by Singapore Business Federation CEO Lam Yi Young.
Labour and Carbon Constraints Are Permanent
Addressing business leaders’ concerns about policies such as carbon tax and foreign workforce tightening, Wong reiterated the importance of long-term adjustments. Singapore’s labour market and carbon constraints are enduring, he noted, and adapting early would strengthen businesses for the future.
“We must restructure our processes to be less reliant on labour and energy,” Wong said, adding that these measures position Singapore to maintain resilience in an uncertain global environment.
Innovative and Connected Economy for the Future
Looking beyond near-term uncertainties, Wong emphasised Singapore’s commitment to innovation and connectivity as critical pillars for economic transformation. Long-term projects like the Tuas Mega Port and advancements in digital infrastructure such as 6G technology will reinforce Singapore’s position as a global hub for business and data flows.
“We need to stay open to entrepreneurs, talent, and investments worldwide,” he stressed, highlighting the role of innovation in driving economic growth and improving living standards.
Singapore’s thriving startup ecosystem is testament to this vision, with 11 startups achieving unicorn status in 2021. Government investments in fundamental R&D have played a pivotal role in catalysing private sector innovation, he noted.
Strengthening Social and Economic Foundations
Wong underscored the importance of sound fiscal policies, social compact strengthening, and initiatives to address inequality in building a resilient society. Despite global challenges, he encouraged Singaporeans to remain optimistic, citing the nation’s strong position and reputation as a trusted business node.
“Our pandemic response has distinguished us, and the healthy pipeline of new investments reflects Singapore’s growing appeal,” Wong concluded.
