Singapore warns of slower growth, higher inflation stemming from the Middle East conflict, and boosts support for households and businesses.
Singapore warns of slower growth, higher inflation stemming from the Middle East conflict, and boosts support for households and businesses.Add CNA as a trusted source to help Google better understand and surface our content in search results.
SINGAPORE: A surge in global energy prices triggered by the Middle East conflict is set to raise costs for households and businesses in Singapore, with the government rolling out close to S$1 billion in additional support measures to cushion the impact. The support package combines targeted assistance for those hardest hit with broad-based measures for households and businesses. On Tuesday , Deputy Prime Minister Gan Kim Yong, Senior Minister of State for Finance Jeffrey Siow, and Coordinating Minister for National Security K Shanmugam delivered three ministerial statements on the fallout from the conflict. In his speech, Mr Gan said the crisis is unlikely to be over anytime soon, stressing that Singaporeans must be prepared for its effects to persist for some time. Recognising that the impact of the crisis will be felt by households and businesses, he said the government will do what is necessary to support them through this period. From higher petrol and electricity prices to rising food costs, the effects are expected to broaden in the months ahead. Authorities warned that uncertainty remains high and the crisis could persist.NO NEED TO TAP FUEL RESERVES OR IMPOSE RATIONING FOR NOW So far, Singapore continues to have access to crude oil and the country has secured crude oil supplies from alternative sources,While recent steps as well as measures taken even before the crisis - such as diversifying its supply sources and investments to build its energy resilience - have helped Singapore to remain relatively stable, Mr Shanmugam said if supply disruptions increase, potential disruptions to its domestic energy and electricity supply cannot be ruled out. However, this remains a “low-probability scenario” for now, he said, adding that the government will continue to monitor developments closely.Singapore maintains strategic food stockpiles, which will help to mitigate the impact of any unforeseen supply disruptions, said Mr Shanmugam. However, he urged Singaporeans to be prepared for some food supplies from some countries to become unavailable and to remain flexible in choosing alternatives. He added that the government is also relooking at the country’s supply chains - with a view towards strengthening them. Gan, Siow, Shanmugam deliver ministerial statements on impact of Middle East war on SingaporeThe impact will be felt across multiple sectors, although the extent remains uncertain due to the evolving situation. Industries ranging from manufacturing to tourism, retail, and transport are expected to face higher costs and weaker demand. The Ministry of Trade and Industry will provide an updated gross domestic product forecast in May.is expected to exceed earlier projections, said Mr Gan. Previously, CPI-All Items and MAS Core Inflation were forecast to come in at 1.0 to 2.0 per cent in 2026, after inflation broadly eased in 2025. If the conflict is prolonged, higher inflation in Singapore’s source markets could further increase import prices over time. The Monetary Authority of Singapore will take these developments into account in its upcoming assessment of the inflation outlook, which it will release on April 14. Businesses may face higher operating costs due to increases in fuel, raw materials, transport, and shipping, while households may see higher prices for electricity, food, transport, and daily necessities. Co-funding for essential bus services among targeted support for businesses amid Middle East war: Jeffrey SiowThe government will also provide temporary assistance to co-fund cost increases for certain essential transport services for school students, seniors, and persons with disabilities, to ensure continued operation without disruption. These include regular transport services to primary schools, Special Education schools, disability services, and health and long-term care services. More details will be announced later. for the Year of Assessment 2026 will be increased from 40 per cent to 50 per cent, said Mr Siow. The cash grant component for eligible companies will be raised from S$1,500 to S$2,000, while the total benefits cap per company will be raised from S$30,000 to S$40,000. MTI will provide more details on the EEG later this year. The government is also prepared to share cost increases directly arising from higher fuel prices for critical government contracts, particularly where delays or stoppages would significantly affect the public interest. This includes major government infrastructure projects, such as the Cross Island MRT Line, or new HDB BTO projects, said Mr Siow.– totalling S$700.07 million and announced at Budget 2026 - will be disbursed in June instead of January 2027, said Mr Siow.of between S$200 and S$400 announced at this year’s Budget will be increased by S$200 for about 2.4 million eligible Singaporeans. Those with an assessable income of up to S$100,000 and who do not own more than one property will receive between S$400 and S$600 in cash in September. The first tranche of U-Save rebates will be disbursed in April, and the second tranche in July. In total, eligible HDB households will receive up to S$570 in U-Save rebates in the 2026 financial year. 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