Economic Impact on Singapore from Surges in COVID-19 Cases in ASEAN Countries
Ministry of Trade and IndustrySpeakers
Summary
This question concerns Mr Desmond Choo’s inquiry regarding the economic impact of rising COVID-19 cases in ASEAN countries on Singapore’s 2021 growth. Minister for Trade and Industry Gan Kim Yong replied that despite regional restrictions, the flow of essential supplies remains stable and merchandise trade grew 30.3% in the second quarter. He highlighted that Singapore’s domestic recovery is on track, with GDP expanding by 14.3% in the second quarter based on advance estimates. Minister for Trade and Industry Gan Kim Yong noted that growth should continue gradually alongside global trends, despite potential weight on neighboring economies. The Ministry of Trade and Industry maintains a full-year GDP growth forecast of 4% to 6% following the 5.4% contraction in 2020.
Transcript
6 Mr Desmond Choo asked the Minister for Trade and Industry (a) what is the economic impact on Singapore from surges in COVID-19 cases in ASEAN countries; and (b) whether it will have a material impact on Singapore's economic growth this year.
Mr Gan Kim Yong: Given the recent surge in COVID-19 cases in some of our Southeast Asian neighbours, they have implemented social and mobility restrictions to limit the spread of the virus. The Singapore Government is closely monitoring the impact of these restrictions on our imports of essential supplies. Thus far, the flow of goods and supplies from our neighbouring countries remains stable. Overall merchandise trade between Singapore and our Southeast Asian neighbours also continues to grow. In the second quarter of 2021, total merchandise trade between Singapore and Southeast Asian countries was S$68.9 billion, an increase of 30.3% compared to the same period last year.
While the implementation of social and mobility restrictions will likely weigh on the economic recovery of our neighbours, the overall GDP growth forecast for the region remains positive. Domestically, Singapore’s economic recovery remains on track. Based on advance estimates, GDP expanded by 14.3% year-on-year in the second quarter of 2021, albeit from a low base. GDP is likely to continue to recover gradually over the course of the year in tandem with the economic recovery globally and in the region. For the full year, MTI expects GDP growth to come in at between 4% and 6%, compared to the 5.4% contraction in 2020.