The fiscal stimulus is considerable and there are signs of an upturn in employment and consumption. But new and larger outbreaks of infection in several states pose significant downside risks. Closer to home, the ASEAN-5 economies [2] are expected to contract by 2.6%. They will benefit from the emerging recovery in manufacturing; while the collapse in tourism will weigh more on some economies. The recovery will also be uneven across industries, ranging from L-shaped to U-shaped to V-shaped. Activities with greater “in-person” interactions – such as hospitality, hotels and restaurants, and tourism – may have to reopen later, observe strict safe-distancing measures, and operate at much lower capacities. Capital-intensive manufacturing and trade-related services could recover faster as demand returns but they might still face frictions in their supply chains. Modern services, such as ICT and financial services, will probably do best given their ability to serve customers and carry out transactions through digital means. While a strong short-term growth bounce is plausible, the longer term recovery is likely to be weak and gradual. People may be slower to return to previous patterns of work as long as the virus is still circulating. Higher unemployment and greater job insecurity will weigh on household spending, particularly once income support measures start to taper off. Businesses are likely to hold back investments in view of heightened uncertainty and this will in turn dampen the strength of the recovery. There may be lasting shifts in demand patterns and the associated disruptions in business activities.

MAS launched a $ million support package in April 2020, to sustain and strengthen capabilities in the financial services and FinTech sectors. The package has two main components: enhanced subsidies for training and manpower costs; and strengthening digitalisation for operational resilience. Top of our agenda is skills. We cannot let up on training and upskilling because of COVID-19. On the contrary, the pandemic has underscored the importance of upskilling, and created the opportunity to do so. Working closely with the financial industry, MAS is taking a comprehensive approach to the skills agenda. Take-up of the various schemes since April has been strong. To help the existing workforce to upskill, MAS has enhanced to 90% the subsidies for training courses certified by the Institute of Banking and Finance (IBF). Close to 11,000 trainees have availed themselves of these training courses since April. To enable fresh graduates to gain meaningful job experience, MAS has enhanced salary support for structured talent development programmes offered by the financial institutions. Financial institutions have committed to hiring approximately 740 Singaporeans under these programmes over the next three years. MAS is also working with the financial industry and Workforce Singapore (W SG) to create traineeship opportunities under the various SGUnited programmes to build the skills necessary for future high growth areas in the financial sector. As of mid-June, 31 financial institutions have offered more than 1,000 vacancies for trainees. To support mid career workers prepare for new roles, MAS has been working closely with IBF and Workforce Singapore.