Managing The Crisis

Since the regional crisis erupted in July 1997, the Government has monitored its development closely and calibrated our response carefully. At the last Budget, we made some adjustments to keep our business environment competitive, but emphasised a conservative fiscal stance as it was too early to determine the full impact of the crisis. In June 1998, Government implemented a $2 billion off-Budget package of cost-cuts and spending measures. These were not intended as the final package. Regional developments at that juncture remained volatile and we needed to assess how events would develop.

While we deliberated over policy options during this period, we identified the critical issues: to maintain the framework for continued economic activity; help companies tide over the crisis and minimise unemployment; and enhance our capabilities and competitiveness for future growth.

With these strategic intentions in mind, the Committee on Singapore's Competitiveness (CSC) has recommended comprehensive measures to help Singapore regain its competitiveness, weather the crisis and emerge stronger. Besides keeping Singapore cost competitive and maintaining economic activity, we have to compete more effectively by growing the revenue side of the business equation.