Despite the region’s highest inflation rates, Singapore’s affluent show confidence in the country’s economic prospects.
SINGAPORE: According to MDRi’s Economic and Spending Sentiment Report, released on Thursday (Aug 22), Singapore stands out in the Asia-Pacific (APAC) region with the highest number of respondents reporting an increase in their cost of living. The report also highlights that Singapore has the highest inflation rate in the region, yet its wealthy residents remain notably optimistic about the local economy.
The MDRi study, a group business of the international law firm Mishcon de Reya, surveyed economic sentiments across six key APAC markets: Hong Kong, Singapore, Malaysia, Thailand, Vietnam, and Indonesia. Among these countries, Singapore had the highest inflation rate at 4.8%, while other nations reported lower rates: Vietnam (3.2%), Indonesia (2.6%), Malaysia (2.5%), Hong Kong (2.1%), and Thailand (2%).
In Singapore, 92% of respondents reported experiencing a slight or significant increase in inflation in 2023. Despite this, 51% expressed optimism for the local economy’s future. Interestingly, while only 40% were optimistic about the global economy and 34% about the regional economy, 72% of wealthy Singaporeans—those with higher incomes—indicated a positive outlook for the economy.
The study also revealed key factors behind Singaporeans’ economic optimism. The majority pointed to national security (62%) and the stability of the financial system (58%) as the main reasons for their positive sentiments. In contrast, innovation and technology (46%) were less commonly cited.
However, Singapore’s high inflation remains a concern for many residents. The report attributes the increase in the cost of living to factors such as the high goods and services tax (GST), rising transportation costs, and the increased prices of retail goods. These factors have significantly impacted everyday expenses for many Singaporeans, making the country’s inflation the most burdensome in the region.
Despite the challenges posed by inflation, the wealthier segment of Singapore’s population remains hopeful about the country’s economic resilience, reflecting a stark contrast with the concerns of lower-income groups.
