Tuesday, March 13, 2012

Singapore is recession ready, says S&P

Mar 13, 2012 - PropertyGuru.com.sg

With a strong financial standing, effective policymaking and structural reforms, Singapore is in good shape to minimise the impact of a possible recession. The country’s sovereign ratings are expected to remain stable this year but it needs to maintain sizeable reserves as well as flexible policy responses.


In a new report on Asia Pacific economies, credit rating agency Standard & Poor's (S&P) noted that Singapore has a stable outlook and will likely keep its current AAA rating.


“The stable outlook reflects our expectation that Singapore will maintain its considerable fiscal and external reserves,” said Tan Kim Eng, Asia-Pacific Head of Sovereign Ratings at S&P.


“The outlook also incorporates our expectation that the government's forward-looking and pragmatic approach to policymaking will prevail in the long term, ensuring that ongoing structural reforms will sustain Singapore's high global competitiveness,” he added.


Singapore’s macroeconomics also draws strength from strong public finances, net external creditor position and a strong track record of macroeconomic management and political stability.


Tan added that “strong fiscal performance continues to underpin the sovereign ratings.”


Although the government previously estimated a balanced budget for FY 2011-2012, he noted that higher property stamp duties and corporate income tax collections led to an eventual budget surplus of around S$2.3 billion, amounting to 0.7 percent of the GDP.


Moving forward, Tan expects the present fiscal year to be as good, noting that “the government projects the overall budget surplus to be S$1.3 billion, although we expect the eventual outcome will likely be higher due to the government's prudent and conservative fiscal track record.”


View the original article here


Source From Property Guru

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