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I’m both surprised and disappointed by MAS action. S’pore is the only economy gangho enough to continue to let it’s currency appreciate.
Yes, taming inflation is important, but how accurate is our data. Personally I don’t feel that the daily essentials and food are more expensive now. I guessed those areas are housing and cars. How many people buy house and cars every year?
S’pore is a very open economy, we depend heavily on trade and tourism to survive. I see 3 areas that will be affected.
1. Our export will drop because S’pore products has become more expensive.
2. Tourists will think twice before they come to S’pore. In fact, early this year, my boss in the US was working a plan to relocate to S’pore due to proximity to customers in Asia. In the end, the corporate cancelled the trip because S’pore is too expensive for this American boss to relocate. And that was beginning of this year when exchange rate still around S$1.40. Now it becomes $1.29, ha, more foreigners will shun S’pore.
3. This one is a bread and butter issue. All the employees of US MNC, including myself, will be affected to some extent. Just look around and try to guess the number of S’poreans currently employed by US companies here. Our wage are converted in the US headquarter before we are being paid in S’pore. I got a 20% pay cut last year and was hoping to recover a little may be 2 to 3 %. Now, I think there is no more hope. I’m quite sure there will be no increment for us in the S’pore office this year because the bosses are already talking about what to do with the increase operation costs in S’pore. Just hope no retrenchment; I had already lost 2 colleagues the last round and they are still jobless today. Very sad thing, not sure the government understand how we feel ? For those who earn just above the peanut labor law limit are not protected by labor law, are struggling. I’m worried…
God Bless.
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