Thailand
MPs back Singapore’s S$27.7m contribution to IMF to help low-income countries cope with Covid-19
SINGAPORE, April 6 — Parliamentarians on both sides of the aisle yesterday backed Singapore’s US$20.57 million (RM85 million) contribution to support International Monetary Fund (IMF) initiatives aimed at helping vulnerable and low-income countries cope with the economic impact of Covid-19.
The Monetary Authority of Singapore (MAS) had first announced this initiative on March 31, and all the Members of Parliament who spoke about the initiative yesterday stood in support of it.
Transport Minister Ong Ye Kung, an MAS board member, said that the majority of the contributions, about US$17.6 million, will go to the Catastrophe Containment and Relief Trust (CCRT).
The trust was established in 2015 to provide debt relief to IMF’s poorest and most vulnerable members in the event of a natural catastrophe or global health pandemic, explained Ong, who was speaking on behalf of Senior Minister and MAS chairman Tharman Shanmugaratnam.
“Singapore’s contribution is based on our quota share at the IMF and similar to how other countries’ contributions are determined,” said Ong.
A second grant will be to the Covid-19 Crisis Capacity Development Initiative (CCCDI) to help meet the urgent capacity development needs of countries affected by the pandemic.
Singapore will make a one-off contribution of US$2 million, which represents 2 per cent of the US$100 million needed to fund the initiative.
The third contribution will be to the Trust for Special Poverty Reduction and Growth Operations for the Heavily Indebted Poor Countries (PRG-HIPC Trust).
Singapore will contribute US$970,000 to the trust, which will provide support for Somalia, which is in urgent need of assistance, said Ong. This would form about 0.3 per cent of IMF’s financing package of US$344 million for Somalia’s debt relief.
Ong said that Singapore is making these contributions as the pandemic has “underscored the need for decisive and urgent collective actions to manage global crises”.
“As a highly open economy, Singapore has a strong stake in ensuring that the world contains the pandemic, restores people-to-people connections across the world, and supports global economic recovery,” he added.
“In short, we live in an interdependent world and Singapore needs to do our part.”
Members of parliament show support
Three Members of Parliament (MPs) voiced their support for the initiative.
MP for Sengkang Group Representation Constituency (GRC) Jamus Lim said that Singapore’s contribution is an important step as “responsible citizens in our global village”.
However, he added that statistics provided by the Organisation for Economic Co-operation and Development showed that between 1960 and 2004, Singapore received an average of US$14.4 million in foreign aid every year, unadjusted for inflation.
In future, Singapore may be set to receive an additional US$5.33 billion worth in new Special Drawing Rights allocations due to a new proposal by the IMF managing director Kristalina Georgieva that is yet to be accepted by the IMF executive board, noted Associate Professor Lim.
“If anything, we are not doing enough…. This amount (the US$5.33 billion) far exceeds the comparatively small amounts that we are formally extending to the fund today,” he said.
Responding to Assoc Prof Lim, Ong said that any increase in overseas funding will increase the fiscal burden and this will have to be funded by tax collections.
He added that Singapore has contributed to the international community in various ways that may not involve direct cash contributions.
For instance, the Ministry of Foreign Affairs has since 1992 run the Singapore Cooperation Programme so developing countries can learn from the Republic’s progress.
“We provide necessary training, they take reference from what we do, we learned from each other,” he said.
“Our stance is not to go around to say that we have all these resources and we can give out more money,” he said. “Along the way we learn many lessons, and we can share these lessons with the rest of the world.”
MP for Bukit Panjang Single Member Constituency Liang Eng Hwa asked if the Government will have visibility on how IMF would utilise the funding. Ong replied that all the funds are subject to the oversight of the IMF executive board.
Singapore is also represented on the board through the voting group of Southeast Asia and will get updates, he said. And from time to time, IMF will publish ad hoc reports on the progress of these funds.
Standing in support of the initiative, MP for Sembawang GRC Mariam Jafaar said that while there will be those who are opposed to the funding, it is important to “continue to demonstrate to our people that our international assistance efforts can make us all better”.
Agreeing, Mr Ong said that when MAS announced the initiative, it was “a little bit disappointing” that there were some social media comments lamenting why Singapore was giving out money to other countries.
“I am glad that all the MPs that stood up and spoke supported this contribution it shows that as a small country we can also be big hearted, and we can also play our role and share our concerns for the future of humanity.” — TODAY