On 24 March 2016, Singapore’s new finance minister, Mr Heng Swee
Keat, delivered his maiden Budget Speech for FY 2016. It is a budget that is
highly pro-business and at the same time addresses the challenges that the
nation is facing. This is also a budget that focuses on the transformation of
the economy to ready itself for the future and it should fall in line with the
aims of the Committee on the Future Economy (CFE). From his speech, some key
policies that will have an impact on real estate includes:
Existing cooling measures will
remain; it was reiterated that it is still premature to relax any
CBRE Research expects the government to continue monitoring the
The Budget remained focused on
increasing productivity as the government stays on course regarding the
tightening of foreign labour.
This could continue to curtail expansionary plans of foreign labour
reliant sectors, especially the retail and manufacturing sectors, which
will have to continue to utilise technology to boost their productivity.
A high proportion of the Budget
was allocated to aid the growth of Small Medium Enterprises (SMEs). One key allocation will be
made towards the $4.5 bn Industry Transformation Programme which aims to
support the industries and innovation.
This could introduce a new wave of new industries and startups that could
eventually translate into demand for industrial and office space.
Jurong Innovation District. In line with the proposed
transformation, the government has also proposed a new precinct in the
North-Western part of the island that embodies the ‘live, work, play,
learn and create’ concept. It aims to be the industrial park of the future
where it ties up manufacturing, academia and research in one location.This new precinct will have positive effects to the surrounding area which
is predominantly public residential and industrial.
Information and communications
technology (ICT), robotics, food manufacturing and healthcare were some
sectors that were focused on in the Budget.
These sectors are likely to be the growth industries of the future in
Singapore which could spearhead the economy.
Urban development will be
another priority of the government and public spending on infrastructure
will continue to be strong.
Neither CBRE nor its affiliated companies make any warranties or claims on the implied accuracy of the information contained herein.
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