Singapore aims to spend 11 billion Singapore dollars (8 billion U.S dollars) in 2021 to combat the health and economic impacts of the novel coronavirus pandemic and related restrictions.
Deputy Prime Minister Heng Swee Keat told lawmakers on Tuesday.
Announcing the wealthy city-state’s 2021 budget in parliament, Heng, who doubles up as finance minister, said that Singapore faces its largest-ever budget deficit, projected at around 64 billion dollars.
Singapore’s gross domestic product (GDP) shrank by 5.4 per cent in 2020, the government said on Monday, the biggest contraction since independence.
The government pledged to spend up to one fifth of GDP during the 2020-21 financial year as the pandemic and lockdowns at home and in key overseas markets hit Singapore’s trade-dependent economy hard.
Singapore was forced to dip into its substantial reserves, with around 42 billion dollars spent so far, Heng said.
The 2021 budget includes plans to spend almost 1 billion dollars on supporting the aviation sector after international travel collapsed in 2020 due to the pandemic, with around the same amount pledged to less well-off households.
Discussing plans to increase the goods and services tax (GST), Heng warned that the government “will not be able to put off the increase for too long.’’
Heng said that the number of foreign workers a manufacturing firm can hire will be cut to 15 per cent of the total headcount from 2023.
Most of Singapore’s almost 60,000 cases of the virus have been among migrants, many of them young male workers in sectors such as construction and shipping. (Dpa/NAN)