Singapore must prepare for more economic challenges as inflation will remain high and central banks are tightening policies, Prime Minister Lee Hsien Loong said, warning that the world may face a recession within the next two years.
Russia’s war on Ukraine has clouded the outlook for Singapore’s post-COVID recovery on which the nation was “cautiously optimistic at the start of this year,” the premier said in a May Day address.
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“Singaporeans are already feeling the impact of the war on the cost of living with the island facing an S$8 billion ($5.8 billion) hit a year from higher energy prices,” he said.
The city-state has charged ahead with post-COVID reopening, leading the region in removing travel curbs and largely returning day-to-day life to pre-pandemic routines.
In a further sign it plans to treat the virus as endemic, the government last month scrapped all tests for incoming vaccinated visitors and limits on gatherings.
The speech also marks Lee’s first major national address since the ruling People’s Action Party tapped Finance Minister Lawrence Wong to eventually succeed him as the next prime minister.
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