Tal og statistik

IMF Staff Completes 2019 Article IV Mission to Singapore

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Via IMF (Den Internationale Valutafond)

IMF Staff Completes 2019 Article IV Mission to Singapore







May 14, 2019







End-of-Mission press releases include statements of IMF staff teams that convey preliminary findings after a visit to a country. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF’s Executive Board for discussion and decision.





  • Following a period of above-potential economic expansion, Singapore’s economic growth is expected to moderate to 2.3 percent in 2019. Risks are tilted to the downside and mainly stem from external sources.
  • The IMF team concurs with MAS’s decision to keep monetary policy on hold for now. Going forward, monetary policy should continue to be data dependent, and the authorities should remain ready to provide fiscal stimulus as a first line of defense if downside risks materialize.
  • The IMF team welcomes the authorities’ concerted efforts to promote a more innovation-based growth model with targeted policies to facilitate the structural transition by mitigating disruption from technology and aging.

An International Monetary Fund (IMF) team led by Nada Choueiri visited
Singapore from May 2 to May 14 to hold discussions in the context of the
country’s 2019 Article IV Consultation. At the end of the visit, Ms.
Choueiri issued the following statement:

“Singapore’s economic growth moderated to 3.2 percent in 2018. After a
surge in domestic demand in 2017, investment declined in 2018. This
moderating trend continued in early 2019, with advanced estimates of growth
at 1.3 percent in the first quarter of 2019 compared to the corresponding
period of 2018. Inflationary pressures remained modest. Nonetheless, labor
market conditions continued to improve in 2018 as unemployment declined,
employment expanded, real wages grew, and take-home pay increased.

“Singapore’s growth is expected to slow further to 2.3 percent in 2019, as
export momentum slows in the context of global trade tensions and softening
global growth. Domestically, investment is expected to pick up with the
economy-wide push for digitalization and new industry-related project
plans.

“The IMF team projects MAS core inflation to slightly edge down to 1.5
percent in 2019 reflecting lower electricity prices due to the impact of
the liberalization of the retail electricity market and lower global oil
prices. Headline inflation is expected to rise to 1 percent as the drag
from accommodation and private road transport costs recede.

“Risks to the outlook are tilted to the downside and mainly stem from
external sources. Indeed, as a financial and trading hub, Singapore is
highly exposed to a tightening of global financial conditions, escalation
of sustained trade tensions, and sharper-than-expected deceleration of
global growth.

“In its April 2019 monetary policy meeting, MAS kept unchanged the rate of
appreciation of the S$NEER policy band, with no change to its width and the
level at which it is centered. The IMF team concurs with MAS’s decision to
keep monetary policy on hold. Going forward, monetary policy should
continue to be data dependent.

“Building on its long-standing efforts to increase transparency and
communications about its monetary policy framework, MAS has announced a
decision to release data on net purchases of foreign exchange. The IMF team
welcomes this announcement which will enhance transparency without
compromising the operational effectiveness of the MAS.

“In the FY2019/20 budget, the overall surplus excluding land sales is
expected to reach 0.5 percent of GDP (IMF’s estimates), incorporating
measures to help address medium-term challenges. Measures directed at
businesses, particularly SMEs, are designed to foster investment, use of
technology, and innovation. Measures to support inclusiveness include the
Bicentennial Bonus, expansion of healthcare schemes, and measures to
encourage employment of older workers. The team encourages the authorities
to remain ready to provide fiscal stimulus as a first line of defense if
downside risks materialize.

“Singapore is a large financial center with a strong regulatory and
supervisory framework. The 2019 Financial Sector Assessment Program (FSAP)
found that the banking sector’s health remains strong, backed by high
capital, liquidity, profitability and overall strong asset quality.

“The IMF team supports the authorities’ concerted efforts to promote a more innovation-based
growth model. Firms are provided targeted incentives to automate,
internationalize and raise productivity. Workers are encouraged to
retrain and upgrade skills through lifelong learning. The MAS is
actively promoting development of a Fintech ecosystem, while
safeguarding financial stability. In addition, social policies are
aiming to make growth more inclusive and tackle rapid population aging.
These policies should facilitate the structural transition by
mitigating disruption from technology and aging
.

“Singapore plays a leading role in regional cooperation. Singapore is also
a leading and active participant in global and regional organizations and
supports the development of economic policy capacity in the region. The
team expresses its gratitude to the authorities for their openness,
cooperation, and hospitality.”


IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Ting Yan

Phone: +1 202 623-7100Email: MEDIA@IMF.org