Middle East conflict prompts Singapore to roll out record support package

Singapore will roll out a support package worth almost S$1 billion ($780 million) to help citizens and businesses cope with the economic impact of the Middle East conflict, Senior Minister of State for Finance Jeffrey Siow said. The package includes cash handouts and fuel vouchers, Reuters reports.

“These measures are aimed at offsetting the sharp rise in energy costs due to the Iran war,” Siow said. “We do not know how long the conflict and its economic impact will last, but the government is alive to the situation.” He noted that the support exceeds the package introduced after Russia’s invasion of Ukraine in 2022, which also drove up fuel prices.

The measures cover cash handouts to eligible Singaporeans, fuel vouchers for car-hire platform workers, private-hire car drivers, and taxi drivers. The government is also increasing the corporate tax rebate to 50%, up from the 40% announced in the FY2026 budget in February.

Deputy Prime Minister Gan Kim Yong said early data indicated Singapore’s economy remained resilient in the first quarter of 2026, though growth is likely to be affected by the conflict. The trade ministry forecasts growth this year at 2% to 4%, with any updates to be announced after a regular review next month.

Coordinating Minister for National Security K Shanmugam highlighted Singapore’s reliance on imported natural gas, which generates 95% of its electricity needs. About 9% of this year’s natural gas requirements were expected to be imported from Qatar.

Shanmugam added that Singapore had not drawn on its reserves, which include natural gas and diesel, but the government is considering increasing them despite the high cost. “Singapore, the world’s third-largest oil trading hub and sixth-largest refinery export hub, has continued to meet its domestic needs and international obligations for fuels,” he said. “It keeps Singapore relevant in the international energy trade, and this has enabled us to have continued access to crude oil.”

Singapore’s FY2026 fiscal surplus was projected at S$8.5 billion in February’s budget, underscoring the government’s ability to deploy support measures without straining public finances.

By Vafa Guliyeva