The BGA Singapore Team, led by Managing Director Nydia Ngiow, wrote an update to clients on Prime Minister Lee Hsien Loong’s 19th National Day Rally.

Context

  • Prime Minister Lee delivered his 19th National Day Rally — widely regarded as the most important political speech of the year — on August 20. While Lee highlighted that geopolitical tensions and uncertain global economic conditions will continue to dampen Singapore’s growth prospects, he focused on resolving social mobility issues as the government’s way forward to secure the country’s long-term growth.
  • Lee looked to quell ongoing cost-of-living concerns by introducing refreshed public housing initiatives and amplifying the government’s plans to support the nation’s rapidly aging population. The People’s Action Party’s renewed focus on bread-and-butter issues appears to be part of a design to regain public confidence and favor after a spate of controversies portrayed the party unfavorably. Nevertheless, Lee stressed that the government will not provide “infinite” financial support.

Significance

  • Lee said the government will prioritize adapting and developing the local workforce to help Singaporeans navigate the unfavorable economic landscape. This is a key policy objective as the rivalry between the United States and China deepens and countries increasingly adopt protectionist measures. Singapore will introduce a new scheme to provide retrenched workers interim financial support, giving them time to upgrade their skills.
  • Lee announced that Singapore will introduce a new SGD 7 billion (US$5.2 billion) Majulah Package, which will focus on supporting “young seniors” aged 50 and above to meet future retirement needs. The fund acknowledges that the escalating cost of living will impact aging populations significantly. Applicable to approximately 1.4 million older citizens, the new package will provide tiered support depending on the individual’s income and Central Provident Fund savings.

Implications

  • Companies can continue to expect policy stability given Lee’s assurances that the leadership succession plans are “back on track” and his calls for the nation to support the fourth-generation (4G) leaders. Singapore’s policy focus will be on transforming the economy to enhance productivity and growth in the longer term. This includes strengthening new economic sectors, such as the digital economy. Companies should continue to engage key political officeholders on talent and skills development initiatives as the government continues to prioritize modernizing the local workforce to leverage the wide range of job opportunities within digital domains.
  • While the second phase of the planned increase in goods and services tax rate from 8 percent to 9 percent will continue as intended on January 1, 2024, Lee left that to Deputy Prime Minister and Finance Minister Lawrence Wong, Lee’s successor as premier. Lee said the government is studying whether more support is needed to ease the impact on the cost of living. He said the Finance Ministry will announce — likely during next year’s budget discussions — whether the Assurance Package will be enhanced further.

Please refer to the following links for the full transcripts of Lee’s speeches in Malay, Mandarin and English. If you have any questions or comments, please contact BGA Singapore Managing Director Nydia Ngiow.

Best regards,

BGA Singapore Team

A small ginko leaf

Managing Director, Singapore

Nydia brings over a decade of experience working at the forefront of international affairs and international trade issues in the Asia-Pacific, with the majority of her career prior to BGA spent working for the Singapore government. Nydia most recently managed the China Program at the American National Standards Institute (ANSI) in Washington, D.C., where she brought together technical, business and policy leaders to find solutions to issues affecting U.S.-China trading relations to strengthen U.S. market access in China. She provided member organizations with coverage of policy and reform issues, and furthered ANSI’s relationships with counterpart organizations in China. Positioned in ... Read More