Singapore crisis actions praised in WTO trade policy review

The World Trade Organization commended the country for deftly coping with the financial turmoil via fiscal stimulus, productivity gains and a continued open economy.

"A report prepared by the WTO Secretariat said that Singapore was hit hard by the global financial crisis. However, a counter-cyclical fiscal stimulus (S$20.5 billion in 2009), monetary easing, strong economic fundamentals, and labour market flexibility resulted in a swift recovery," according to a release from the Ministry of Trade and Industry (MTI), which led the WTO Trade Policy Review (TPR) delegate in Geneva, Switzerland.

"Singapore has responded to new challenges by launching a productivity drive to boost GDP growth and facilitate its transformation into a high-tech economy, the WTO report added."

MTI said WTO Members applauded Singapore’s trade and economic policies, and made suggestions where our policies could be improved upon.

"In particular, Members noted that Singapore did not resort to protectionist measures during the global economic crisis. Singapore’s open and competitive economy contributed to a swift recovery. Members also appreciated Singapore’s strong commitment to the multilateral trading system, and its active participation in the regular work of the WTO," said MTI.

Responding to Members, Mrs Ow Foong Pheng, Permanent Secretary for Trade and Industry and leader of the Singapore TPR delegation, highlighted that as a small city-state Singapore faces unique challenges. These include limited land and labour resources. Singapore will have to continue to restructure the economy towards higher value-added, knowledge- and technology-intensive activities, she said.

“Economic restructuring is not new to us. We have made the transition from low-cost manufacturing in the past to higher value-added, knowledge and technology intensive activities in many of our key sectors,” Mrs Ow said. “We  believe that innovation, productivity and skills upgrading are the means by which we can ensure sustainable and inclusive economic growth for Singapore."

New Zealand Ambassador John Adank, who led the discussion on Singapore’s trade and economic policies, said in his closing statement that Members’ questions showed their interest to learn from Singapore’s experience in managing trade and economic issues, particularly with respect to how Singapore dealt with the global financial crisis.

He noted the challenges that Singapore faces as a small city state. “City states are undeniably quite different in their characteristics from larger metropolitan states,” Mr Adank said. “Singapore needs to draw talent from the wider world, and is therefore compelled to globalise and open up in a way that others are not.”

In his closing statement, Colombia Ambassador Eduardo Munoz, who chaired the TPR session, summed up by saying that “Members praised Singapore for remaining one of the most open and liberal economies in the world, and the easiest country in which to do business.”