All over East Asia, governments are encouraging spending amongst their populations.
In Singapore, the government is spending S$2.9 billion or 1.2% of its GDP, including S$600 million package over two years to enhance job training programs and encourage financing plans that can give bigger loans, raising government risk sharing of loan defaults.
Singapore is however cautious about encouraging direct spending amongst its population as an additional dollar of spending would result in 60 cents leaking out of the economy as almost all of what Singaporeans buy is imported. By encouraging training programs, Singapore could help low and middle income households acquire new skills to get new jobs.
Neighbouring Malaysia is expending RM 7 billion or 1.1% of its GDP with RM 5 billion of it for construction and upgrading of infrastructure such as schools, highspeed broadband, hospitals, roads, low cost housing and government buildings. RM 600 million is also allocated for worker training programmes.
In Northeast Asia, Hong Kong is spending HK$19.3 billion or 1.2% of its GFP in 66 small scale projects to create over 12 000 jobs and the early initiation of the construction of a mega bridge to link Hong Kong, Zhuhai and Macau to 2009 instead of 2010.
Taiwan is giving its 23 million citizens NT$3600 shopping vouchers each during the traditional Chinese New Year celebrations to augment spending amongst its population. They are valid until September 2009.
China is spending 4 trillion yuan or 16% of its GDP on large scale infrastructure projects such as railways, roads and airports. 1 trillion of its will be used to rebuild areas damaged by the May 2008 Sichuan earthquake.
Japan is spending 5 trillion yen or 2% of its GDP in direct cash payouts to families, tax breaks on mortgages, bank rescue scheme in public fund injections and tax relief for small firms. A 27-trillion yen stimulus package initiated on 30 October 2008 by the Aso administration sees every Japanese getting 12 000 yen (S$200) and childnre under 18 and elderly over 65 getting an extra 8000 yen each.
AP, AFP and ST, “Stimulating the economy” dated 6 December 2008 in the Straits Times (Singapore: Straits Times), 2008, p. A14, A16 and A18.
Ho, Ai Li, “Will shopping vouchers do the trick?” dated 6 December 2008 in the Straits Times (Singapore: Straits Times), 2008, p. A18.
Kwan Weng Kin, “Handouts unlikely to help economy” dated 6 December 2008 in the Straits Times (Singapore: Straits Times), 2008, p. A14.