In today’s Budget 2019 deliberations, Singapore Finance Minister Heng Swee Keat aspires to forge a subtle equilibrium — achieve economic vigilance while extending substantial social spending prior to elections which may be slated earlier this year.
The 2019 budget will include a variety of policy priorities, one of which is infrastructure.
While international conditions necessitate watchfulness due to weaker demand and the U.S.-China trade pressures are leading to Singapore’s export-reliant economy running at a slower pace than expected, Heng and other officials have repeatedly affirmed that they’re “not done building Singapore.”
Rail Infrastructure Fund
In 2018, the Singaporean government launched the Rail Infrastructure Fund designed to accrue savings for major rail line upgrades.
The government injected S$5 billion followed by top-ups as Singapore is planning to spend more to develop new infrastructure over the next 10 years including the expansion of its rail network by over 100km.
The government is also looking into borrowing from the Statutory Boards and government-owned companies which build infrastructure.
The move was expected to assist in spreading the cost of specific large investments in the future such as the KL-Singapore High Speed Rail project and the JB-Singapore Rapid Transit System Link project.
In a speech, Heng said that a government guarantee will enhance the confidence of creditors.
“This is another way to use the strength of our reserves to back our infrastructure projects without directly drawing on the reserves,” he stressed.
Infrastructure development goes beyond building up transport links. Singapore is also investing in major projects, such as the Remaking our Heartland programme to renovate towns and districts in Singapore, building new schools and hospitals, and developing regional centres such as Woodlands and Jurong.
These undertakings are expensive but essential. They serve to boost the city-state’s economy, create jobs, benefit Singaporean families, and represent the confidence Singaporeans have in the country’s future.
Due to the limitations of national resources, there needs to be meticulous and judicious investment decisions to guarantee that public funds are spent with caution, balancing different priorities.
For this infrastructure spending, investments are crafted for the long-term and targeted at preparing Singapore for the future.
It is believed that Singapore is able to do this because decisions to spend are always directed by the key standard of fiscal sustainability , meaning, spending only what the country can afford, while providing a better future for everyone.
In this manner, future generations of Singaporeans are guaranteed to benefit from the decisions made today.