P. S. Suryanarayana
SINGAPORE: Singapore, which is facing its worst recession, has announced crisis-busting plans amid Monday’s Chinese New Year’s Day celebrations.
Prime Minister Lee Hsien Loong interspersed his traditional New Year message with the announcement that the authorities “are for the first time seeking the President’s approval to draw on our [foreign exchange] reserves … a key asset for Singapore.”
The objective was to dip into the City-State’s much-safeguarded reserves to cover “two special schemes.” To help companies meet their wage costs, a “jobs credit” scheme would now be launched. A “Special Risk-Sharing Initiative,” now on the cards, would help companies maintain “their access to much-needed financing,” said Mr. Lee.
So far, Singapore and Japan are the two East Asian countries to have acknowledged a serious recession following the global financial crisis.
In Tokyo, the state of the economy is snowballing into a major political issue despite Prime Minister Taro Aso’s pledge to ensure that Japan would be the first developed country to come out of the current crisis.
Singapore’s revised growth estimate for 2009 was now placed at between minus-five per cent and minus-two per cent.
Mr. Lee said a “Resilience Package” was, therefore, being unveiled, consisting of tax incentives, business grants, and the two special schemes