Ms Cheng Li Hui: To ask the Minister for Trade and Industry with regard to the trade tensions between China and the United States (a) what are the implications of a lower economic growth forecast for 2019 and what can be done to mitigate it; (b) whether Singapore's exports have decreased over the last few months; (c) which industries are the hardest hit and how can they cope with this difficult period; and (d) whether the plans laid out in the Industry Transformation Maps are affected and require calibration.
1. The impact of the trade tensions on the Singapore economy has been limited thus far. In the first three quarters of 2018, Singapore’s non-oil domestic exports (NODX) grew by 6.2 per cent on a year-on-year basis, with the third quarter of 2018 marking the eighth consecutive quarter of growth in NODX. Notwithstanding this, Singapore’s GDP growth is likely to moderate in 2019 on the back of an expected slowdown in growth in major advanced and regional economies such as the US, China and ASEAN-5 economies, in part due to the ongoing trade tensions.
2. The impact of the trade tensions on the Singapore economy will be felt most in externally-oriented sectors which are plugged into the US-China supply chains, such as the electronics and precision engineering clusters. However, there is potential for businesses to mitigate some of the impact by redirecting their exports of intermediate goods to other markets. In addition, there could be some offsetting effects when US and Chinese importers source more from the ASEAN region, including Singapore.
3. Our economic agencies are working closely with businesses to identify any disruptions promptly, and facilitate link-ups with other suppliers and markets to restructure supply chains where necessary. Businesses can also leverage on the strong trading networks that we have developed over the years, as well as our extensive network of free trade agreements, to navigate the disruptions and seek out new opportunities and alternative suppliers and demand markets.
The Government will continue to press on with efforts to help companies build the capabilities that they need to access new markets, on-board cutting-edge technologies, and create good jobs. The Industry Transformation Maps (ITMs) are dynamic plans that will be updated to respond to changes in the economic environment. The Future Economy Council, comprising tripartite representatives, monitors the progress of our ITMs, and ensures that they continue to be relevant to emerging trends. The Council will monitor the situation and adjust the ITMs as the situation requires, in partnership with key stakeholders, such as businesses, trade associations and chambers, and unions
19 NOV 2018