Budget 2020, which Deputy Prime Minister and Finance Minister Heng Swee Keat will present in Parliament next Tuesday, will come at a particularly challenging time for the economy. The economic impact of the coronavirus, which has spread from China to more than 24 countries and territories, is already being felt in Singapore. With travel abruptly disrupted, tourism-related sectors felt the effects immediately. Manufacturing and logistics are also being hit as the disruption of supply chains is affecting production. And both business and consumer confidence have taken a blow, which will impact the wider economy.
Even before the coronavirus appeared, the Singapore economy faced headwinds as a result of United States-China trade tensions, sluggish world trade and an economic slowdown in China, which is now intensifying. The official growth forecast for Singapore this year, currently 0.5 to 2.5 per cent, will almost certainly have to be scaled down. Against this grim backdrop, many are hoping that the Budget will be expansionary, yet carefully targeted to cushion particularly the economic sectors and sections of the workforce most affected by coronavirus-related dislocations.