Budget 2022 debate: Gan Kim Yong on managing fallout from Ukraine crisis

The immediate and direct impact on Singapore’s economy and firms from the conflict in Ukraine has been manageable, for now. Singapore does not import many essential supplies from Ukraine and the region, and its companies have a limited presence in Ukraine. The conflict is still evolving, and will have real and significant impact. Trade and Industry Minister Gan Kim Yong shared this assessment in Parliament on Monday (Feb 28), warning that global prices of energy and other products are set to rise in the coming weeks. Singapore will feel the brunt. Motorists must expect pump prices for petrol and diesel to go up. Electricity rates will also increase and further raise the cost of living. The crisis will also further strain global supply chains, and in turn raise the prices of goods. Mr Gan said the Government is working with key companies to review their business continuity plans and minimise disruptions. He also said the Ukraine crisis has clouded Singapore’s economic outlook. What is clear is that inflationary pressures are likely to rise further in the near term. He said the Government has put in place a multi-pronged strategy to support businesses and households. Firstly, it will work with industries and firms to keep the economy competitive to sustain real wage growth. Secondly, a stronger Singapore dollar will help to moderate the impact of external cost pressures. Thirdly, the Government works with a wide range of stakeholders to manage the cost drivers. Mr Gan said the conflict in Ukraine is a stark reminder that Singapore must strengthen its defences against such external shocks by building a vibrant, diversified and resilient economy, as well as forging a cohesive and united society.