The authorities have announced 4 packages of measures on February 18, March 26, April 6, and April 21 amounting to a total stimulus of S$63.7 billion (13 percent of GDP).
Funds to contain the outbreak are about S$800 million (mainly to the Ministry of Health). The Care and Support Package provides support to households (S$ 5.7 billion), including a cash payout to all Singaporeans, and additional payments for lower-income individuals and the unemployed.
The Stabilization and Support Package provides support to businesses (about S$35.3 billion), including wage subsidies, an enhancement of financing schemes, and additional support for industries directly affected and the self-employed. It also sets aside loan capital of S$20 billion and introduces other economic resilience measures (S$1.9 billion).
In Summary Singapore has ...
Singapore will spend nearly 100 billion Singapore dollars ($70.4 billion) to help businesses and households manage the economic impact of the coronavirus. That’s almost 20% of the country’s GDP, said Deputy Prime Minister and Finance Minister Heng Swee Keat.
“This is a landmark package, and a necessary response to a unprecedented crisis,” Heng said in a speech to parliament.
MONETARY AND MACRO-FINANCIAL
On February 14, the Monetary Authority of Singapore (MAS) welcomed the announcements from banks and insurers in Singapore to support their customers facing financial difficulties due to the impact of the COVID-19 outbreak, while adhering to prudent risk assessments. On March 31, the MAS and the financial industry announced a detailed package of measures to help individuals and SMEs facing temporary cashflow difficulties. The package has three components: (i) help individuals meet their loan and insurance commitments; (ii) support SMEs with continued access to bank credit and insurance cover; and (iii) ensure interbank funding markets remain liquid and well-functioning. A second package announced on April 30 extends the scope of relief for individuals to a broader set of loan commitments.
On March 19, the MAS announced the establishment of a US$60 billion swap facility with the US Federal Reserve. The MAS intends to draw on this swap facility to provide USD liquidity to financial institutions in Singapore. The first MAS US$ auctions were held in late March and weekly auctions are held every Monday.
On March 30, the MAS adopted a zero percent annual rate of appreciation of the policy band and reduced the mid-point to the prevailing level of the S$NEER, with no change to the width of the band.
On April 7 the MAS announced that it will adjust selected regulatory requirements and supervisory programs to enable financial institutions to better deal with issues related to the pandemic.
On April 8, 2020, the MAS announced a S$125 million support package to sustain and strengthen financial services and FinTech capabilities. The package, funded by the Financial Sector Development Fund, has three main pillars: (i) supporting workforce training and manpower costs; (ii) strengthening digitalization and operational resilience; and (iii) enhancing FinTech firms’ access to digital tools.
Enhanced wage support for businesses that cannot resume operations immediately after Singapore’s partial lockdown — or “circuit breaker” — is lifted next month, or those in hard-hit sectors;
Waivers and rebates in foreign worker levy for companies in selected industries such as construction, as well as marine and offshore;
Rental waivers and relief for small- and medium-sized enterprises;
Expanding the number of opportunities in public and private sectors to more than 40,000 jobs.
The additional spending will push Singapore’s budget deficit to 74.3 billion Singapore dollars ($52.3 billion), or around 15.4% of GDP — the largest-ever shortfall for a country known for its prudence.