A day after Manpower Minister Lim Swee Say claimed credit for the better-than-expected GDP growth on Friday (Nov 24), economists voiced out in unison saying the Minister is talking nonsense. According to CIMB economist Song Seng Wun, the GDP growth is not government’s effort:
“The positive figures are mostly driven by external demand, rather than efforts of the government. On the whole, the global economy did better. In the United States, Europe, their economies did better. In Asia, propped by China, markets did well, so this stronger demand is reflected in Singapore’s output… On the flipside, the services sector on the whole – which includes food and beverage and business services – only had productivity growth of 1 per cent this year.”
During his speech at a gala dinner on Friday evening, Minister Lim Swee Say said that as total employment did not grow, all GDP growth is attributed to the increase in productivity. The Minister then praised his government policies and credit himself for the GDP growth.
Maybank economist Chua Hak Bin also disagreed with the Minister and pointed out that productivity growth in Singapore is still weak:
“We have to bear in mind that (the overall growth) is led by the manufacturing sector. If you look at services and construction sectors, productivity growth remains pretty low and lacklustre.”
IHS Markit principal economist Bernard Aw said that the higher productivity growth was achieved through retrenchment and cutting of headcount, hence there is nothing to celebrate about:
“Goods producing industries such as manufacturing has been providing the bulk of productivity growth, supported by a combination of higher output and reduced staff headcounts.”