ISSN 2330-717X

Singapore’s Measured Progress And Guarded Optimism In 2021 – Analysis

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By Chang Yee Kwan*

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Singapore experienced considerable success returning to normalcy in 2021 following the disruptions of COVID-19. The nationwide vaccination drive beginning on 30 December 2020 and resumption of classroom instruction on 4 January 2021 have provided optimism for a continuing return of socioeconomic activity and economic recovery. Policymakers must still work hard to build public confidence in the government’s handling of the pandemic response by building social trust and addressing economic concerns.

Policymakers have signalled the resumption of socioeconomic activity and economic recovery as clear priorities in the annual government budget. US$17.6 billion (S$24 billion) was allocated for job creation and skills training, while another US$8 billion (S$11 billion) was allocated for the nationwide administration of vaccines and implementation of related public health measures. This included contact tracing and various subsidies and financial assistance schemes. The focus on economic recovery was further underscored by the government’s intention to borrow up to US$66 billion (S$90 billion) for infrastructure projects. US$1.9 billion (S$2.6 billion) worth of 30-year bonds was also auctioned off on 28 September 2021.

On 31 May, policymakers announced a change in Singapore’s COVID-19 management strategy. The government moved away from a zero-COVID strategy toward regular testing, identifying transmissions and encouraging vaccinations accompanied by a gradual relaxation of restrictions.

But the increase in community transmissions saw the reimposition of restrictions on dining out and other community activities from 16 May to 13 June 2021. These included transitioning to online learning in schools and cancelling the World Economic Forum’s annual meeting in Singapore. Restrictions were again reintroduced from 22 July to 18 August 2021 and from 27 September to 22 November 2021 in response to increases in community transmissions and hospitalisations.

Despite these episodes, the aggregate indicators promise an extended recovery into 2022. Various information campaigns to encourage vaccination against COVID-19 have been successful. Unvaccinated individuals without medical exemptions must bear treatment costs for COVID-19 and face more stringent access requirements to attend workplaces and various public spaces.

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87 per cent of Singapore’s resident population had received a full regimen of two vaccine doses and 41 per cent had a booster by the end of 2021. Double vaccination doses will increase with the start of vaccinations for children aged 5 to 11. Since the start of the pandemic, Singapore’s resident population of 5.45 million has reported over 275,000 COVID-19 cases and over 800 deaths, with most fatalities caused by the Delta variant.

International travel to Singapore has also increased through vaccinated travel lanes (VTL). Travellers fully vaccinated with World Health Organization-approved doses are exempt from quarantine on arrival. As of 15 December 2021, VTLs for air travel with 24 countries are active. A land VTL between Singapore and Malaysia has been open since 29 November 2021.

Official estimates project Singapore’s overall economic growth to be about 7 per cent for 2021. This compares well against IMF estimates of 5.2 per cent for advanced economies and 6.4 per cent for emerging economies. Resident employment also rose in 2021 after declining in 2020. From 1 January 2022, up to half of a company’s fully vaccinated employees can resume work onsite.

But resident long-term unemployment remains elevated above pre-pandemic levels and sectoral recovery is uneven. Singapore’s prospects in 2022 will also remain dependent on the evolution of COVID-19 and the global response.

Addressing several domestic concerns are crucial to increasing popular support in the pandemic response. A recent survey reported lower public confidence in the public sector’s management of the pandemic following a surge in COVID-19 transmissions and deaths in October and November 2021. There is also continuing ambiguity about Singapore’s future leadership and concerns about a lack of diversity among ruling party decision-makers.

COVID-19’s persistence has led to signs of pandemic fatigue and increased economic hardship which is affecting social cohesion and amplifying social inequalities in Singapore. It has also reinvigorated concerns about economic insecurity, notably healthcare costs, employment and housing. These will only increase with inflationary concerns like the rise in public transport fares.

Singapore’s previous successful management of COVID-19 was due to a high level of acceptance and cooperation with policymakers. Policymakers have acknowledged a need to further engage and strengthen social trust and address economic concerns.

Reforms remain parametric at best. For example, the drafting of new legislation formalising current mediation and arbitration guidelines against workplace discrimination focuses on ensuring employment in the formal sector to manage economic insecurity and inequality.

While existing measures have helped mitigate the pandemic’s excesses, social risk pooling remains limited. Lapses in managing COVID-19 home recovery protocols and ensuring the welfare of foreign workers have only further highlighted existing structural inequalities. More substantial reforms are needed to address these structural inequalities.

*About the author: Chang Yee Kwan is a Non-Resident Fellow at the Center for Southeast Asian Studies, National Chengchi University, Taipei.

Source: This article is published by East Asia Forum and part of an EAF special feature series on 2021 in review and the year ahead.

East Asia Forum

East Asia Forum is a platform for analysis and research on politics, economics, business, law, security, international relations and society relevant to public policy, centred on the Asia Pacific region. It consists of an online publication and a quarterly magazine, East Asia Forum Quarterly, which aim to provide clear and original analysis from the leading minds in the region and beyond.

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