SINGAPORE (July 17): The economic and health crisis brought about by the Covid-19 pandemic will have quite some ways to go. “We are not at the beginning of the end,” says Ravi Menon, managing director of the Monetary Authority of Singapore (MAS). “But rather [we are] at the end of the beginning,” he stressed in an online media briefing on July 16 which was held in conjunction with the release of the central bank’s annual report this year.

As Menon pointed out, Singapore is going through its most severe downturn since independence. The economy contracted 6.5% y-o-y in the first half of 2020 — the first decline since the Global Financial Crisis in 2008. Construction, travel-related and customer-facing domestic services — each comprising 4% of the country’s GDP — bore the brunt of the circuit breaker measures.

In comparison, trade-related and modern services clusters were less impacted. But now, as Singapore restarts its economy under Phase 2 reopening after going into lockdown during the “circuit breaker” period, things may get a little better. Menon conceded that a strong short-term bounce in growth is plausible, though this would be coming from a low base. The level of economic activity, however, will remain well below pre-crisis levels for “quite a while”.

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