Under the current economic environment and government policies, the annual growth rate of national reserve in Singapore will be equal to the annual growth of GDP, and there will be no more and more reserves.
When Premier Li Xianlong participated in the public fiscal motion debate on Wednesday (February 7), he estimated Singapore's future fiscal surplus to reiterate the contribution of reserve investment returns (NIRC for short).50%of the approach is correct and sustainable.
He said, assuming that the actual return of Singapore's reserve for a long -term expected reserve is 4%, half of which means that the reserve should increase by 2%each year, and this is also the only growth path for the reserve.Because government land sales only converted tangible assets into equivalent financial assets, not increasing income, and future fiscal budgets are difficult to have surplus. As for borrowing and foreign exchange, they may be redeemed at any time, not really the country's money.
Premier Li said he hoped that economic growth would maintain 2%.He explained that local labor will not increase, and productivity can only reach a 2%growth after giving great efforts."The balance will be the same every year. It will not be more and more in the case of economic growth."
The fiscal budget of the past five years also shows that NIRC is equivalent to 3.5%of the GDP and has not increased to four or five percentage points, which means that the reserve has not been increasing.
Premier Li also said that the maintenance of half half of the reserves of the reserve investment can avoid the need to double the consumption tax to pay the expenses. "I think this is a good thing."
