Workers, business must brace for tougher conditions as government delays reversing pension plan cuts
The government is ready to provide support for businesses and workers should the economy slow faster than expected, according to Prime Minister Goh Chok Tong.
In a May Day message to citizens Mr Goh said, however, that because of the gloomy outlook, Singaporeans should not expect a full restoration of mandatory cuts to their state savings until next year at the earliest.
'A full-bloom recession is unlikely. But if the slowdown becomes more severe than we expect, the government will implement measures to help companies and workers cope, as we have done before,' Mr Goh said.
The tone of his address was extremely sober as he warned of the simultaneous pressures of the slowdown in the United States, the downturn in the global economics cycle and tougher conditions across Southeast Asia.
Last year, Singapore's gross domestic product grew by 9.9 per cent. This year the government expects an expansion of between 3.5 per cent and 5.5 per cent, down from an earlier estimate which put growth as high as 7 per cent.
The lengthy delay to making good the cuts to the Central Provident Fund (CPF) savings scheme could disappoint many.
