Prime Minister Lee Hsien Loong said in his New Year’s message on Friday (Dec 31) that 2022 will be a “time of transition” as the economy recovers steadily and Singapore reconnects with the rest of the world.
Mr Lee expects gross domestic product (GDP) to grow by 3 to 5 per cent next year. He said that barring new disruptions, Singapore’s economy “should grow in step with the global economic recovery”.
He added: “We will progressively phase out emergency support measures as businesses revive, though some sectors will take longer to recover.”
“As the Omicron situation comes under control, we will be able to safely expand cross-border travel and reconnect with the rest of the world.
“We will also press on to bring in much-needed migrant workers, and ensure international talents are welcomed and can complement Singaporeans.”
He added that the Government is “planning ahead to achieve our longer-term goals”.
For example, it will press on with industry transformation to enhance existing strengths, and help companies restructure and workers upgrade their skills.
To keep workers productive and employable throughout their careers, the Government will continue to invest in them, in partnership with businesses and the labour movement.
In addition, it will seek new areas of growth, including in the digital and green economies, to build on its current Smart Nation efforts and the Singapore Green Plan 2030.
Tough measures to save lives and livelihoods
Mr Lee noted that the Covid-19 pandemic has been a “long and hard-fought battle”.
He said the Government took tough measures to protect lives and livelihoods, citing Singapore closing its borders for the first time as an example.
“We drew heavily on our past reserves to support workers and businesses. We innovated and adapted quickly to new ways of living, working and learning.”
He added that it was these factors that allowed Singapore’s healthcare system to remain resilient and prevented “significant loss of life”.
The Government’s budgets also “saved jobs and nursed the economy back to health”.
At every step of the way, Singaporeans have rallied together with strength and resolve to support one another. Many have gone above and beyond their call of duty.
“Our front-liners, especially our healthcare workers, have worked tirelessly round the clock.
“Business and everyday heroes, often in less visible places, have displayed courage and public-spiritedness, to keep Singapore going and everyone safe.”
Mr Lee also highlighted the achievements of Singapore’s athletes, including swimmer Yip Pin Xiu’s two golds at the Tokyo Paralympics, as well as Aloysius Yapp’s victory in pool-billiard and Shayna Ng’s in bowling.
“It was a glorious year – the Lions showed courage and grit at the Suzuki Cup, and Loh Kean Yew became our first-ever world badminton champion,” he said.
“Team Singapore has inspired us with their spirit, and made us proud in these challenging times.”
However, Mr Lee cautioned that the fight against Covid-19 is not over, as the new Omicron variant has brought new uncertainties.
“Thankfully, our position is now greatly strengthened compared to two years ago,” he said.
“We have rolled out boosters, and started vaccinating children under 12. We have also learnt to manage the public health challenges better, while minimising the hit on our economy.
“As we brace ourselves for the impact of Omicron, we can be quietly confident that we will cope with whatever lies ahead.”
Mr Lee said the Government’s immediate task is not just to get through Covid-19, noting that Singapore must generate new growth, new jobs and prosperity in a post-pandemic economy.
This depends greatly on a stable global and regional environment, at the heart of which is the relationship between the United States and China.
“The rivalry between the two great powers remains acute, but their recent high-level engagements and practical cooperation on climate change are encouraging.”
Mr Lee said Singapore will continue to engage with its partners “far and near”.
“We will continue to pursue trade liberalisation and regional integration for the benefit of our people, including through the Regional Comprehensive Economic Partnership which comes into force on the first day of 2022.”
Covid-19 ‘will not be the last crisis to test Singapore’
Describing Covid-19 as a “crucible of a crisis for this generation of Singaporeans”, Mr Lee said the pandemic has “shown us the importance of standing united”.
“It will not be the last crisis to test us; we will face more tests in our nation-building journey.”
“We must steel ourselves to resist powerful external currents, that will tug at our fault lines and not allow them to divide us.”
“As a new generation grows up with new perspectives and expectations, our societal norms will evolve. We should manage these changes carefully, and maintain our core values as Singaporeans.”
To do so, Singapore must continue to strengthen its social consensus and shared identity.
It is also crucial to build trust and mutual understanding between the Government and the people, and among Singaporeans of different backgrounds.
“Even amidst the pandemic, we have not neglected this crucial task,” he said.
“We have enabled Muslim nurses in public hospitals to wear the tudung.
“We are actively strengthening fairness at the workplace and support for women, as well as improving protection and retirement adequacy for self-employed persons.”
“Looking ahead, we will work to fortify our social compact – to mend the fissures that the pandemic has deepened, uplift those who have fallen behind, strengthen safety nets for those in need, care for people’s mental health and meet the needs of an ageing society.
“This is the path to a fairer, more inclusive and more united Singapore.”
Goods and Services Tax hike
For Singapore to achieve its goals, it will need a vibrant economy, as well as reliable and adequate revenues to carry out its social programmes, said Mr Lee.
The Government will therefore “start moving on” the planned Goods and Services Tax (GST) increase in Budget 2022, which will lay the basis for sound and sustainable government finances for the next stage of Singapore’s development.
“We have seen this need for several years. Now that our economy is emerging from Covid-19, we have to start moving on this.”
The plan to raise GST by two percentage points, from 7 per cent to 9 per cent, was first announced in 2018 by then-Finance Minister Heng Swee Keat.
In his New Year’s message, Mr Lee added that through the pandemic, Singaporeans have “rallied together, supported difficult decisions, made many sacrifices, and come through safely”.
With this, the country can “confidently say that we have come into our own as one people”, he added.
“In a crisis, everyone has seen the need to make tough choices and to accept difficult policies for the common good,” he said.
“Looking ahead, in the face of long-term challenges, we must maintain this unity of purpose, unyielding spirit and willingness to accept difficult measures, so that we can overcome the odds and move forward decisively together.
“This is how we will build a Singapore where everyone has a place and no one is left behind,” he said.
“Let us stand united as one people and one Singapore – always looking ahead, securing our place in the world, and building an inclusive society that we can all be proud to call home.”
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