Considering the size and location of the country, Singapore’s economy is mostly driven by its exports. From raw materials to heavy machinery, Singapore exports it out of its shores and to other countries.
However, there is now a growing call from economists for Singapore to change its strategy and focus on boosting domestic consumption to assist economic growth.
Some groups find this recommendation unique because Singapore has reported low expenditure rates throughout the country despite the high cost of living Singapore.
Current Status of the Global and ASEAN Economy
In recent years, the global economy has been besieged with various issues. There is a decline of the Eurozone and its attempts to assist ailing countries. There’s the crash of the Shanghai Stock Market, which affected stocks across the globe due to the fact China is the second largest economy in the world. The global economy had also experienced several ups and downs, mostly due to the increasing inflation rate.
Within the ASEAN region, five major issues have been identified by the Institute of Chartered Accountants in England and Wales which affects its current stability:
- The sudden drop in prices for commodities.
- The weakening and instability of the Chinese economy
- The weakening of the global trade
- The US Federal Reserve’s constant pronouncements over changing its interest rates
- The performance of the export markets isn’t very good.
These five issues have caused problems for the growth rates in the region and ultimately led to the decline of economic growth. Since China no longer requires a lot of raw materials due to the end of its construction boom, many markets who depend on experts have lost a lot in the process.
Recommendations to Help
According to the ICAEW and various experts who looked into the matter, it is time for ASEAN economies to look into other industries such as knowledge-focused industries and manufacturing to help sustain their economies. Singapore has already taken the first steps to bolster its technology sector through TechSG, which would assist technology entrepreneurs to kickstart their business.
However, if governments wish to assist individuals to help with spending even if money is very scarce for many people. Governments can introduce new policies that would strengthen citizens’ social security so they don’t have to save money.
Can Getting a Personal Loan Help?
While the idea of spending a lot may assist the economy to improve, it is not very easy to spend in Singapore due to the high living costs in the country. Both Singaporeans and foreigners alike would need a lot of money to get by every day.
One of the most notable ways to get by in the country is by acquiring personal loans from moneylenders, banks and other financial institutions.
However, personal loans should not be taken lightly and must only be used in extremely serious circumstances. In the UK and the US, debt-fueled consumption has led to the decline of its growth and economy.
So, where should you use personal loans and where you shouldn’t?
Yes, you can get a personal loan through a licensed moneylender in these occurrences:
- Paying off your debts
If you have a lot of debts, especially those with high interest like credit card bills, you should use personal loans to sort it out easily. By using a personal loan, you can consolidate all your debts into one massive debt that can be paid every month with a lower interest rate. Since you only have to worry about one bill, you can save up more money and manage your finances and spending better.
- Improving your home
Investing in a home is a very good debt people should consider it because it offers a lot of benefits in the long run. However, you will need to have a lot of money to invest in a house and getting a personal loan is the way to go. If you have gotten a renovation loan in Singapore, it will help you increase the value of your home. If you got a home loan, you will be able to buy the house of your dreams quite easily without having to worry about high debts.
- Education or Career
Similar to getting home loans, using a personal loan for one’s career and education is good because it will provide you a lot of benefits in the future. Once you finish your education at a good university or training overseas, it will allow you to get more opportunities to get more income since your skillset matches high paying jobs.
No, you shouldn’t get a personal loan for these instances:
- Luxuries
It is not ideal to take on more debts if you plan to purchase luxury items, hold extravagant parties or go to exotic locations. While yes, you can borrow money for these instances, it will just cause you to be stuck in a lot of debts even further.
For those who wish to have their dream wedding or honeymoon, it is ideal to borrow what is enough for the wedding or honeymoon.
- Medical bills
If there is a medical emergency in the family, personal loans would be crucial to help you pay it all up. However, before you do consider using a personal loan for this specific bill, you need to sort out your payment terms with the hospital or medical provider so you do not have to worry about paying the interest. You should also try your best to speak to the provider if they can waive some of the fees so you do not have to pay a lot.
- Purchasing or refinancing a property
Finally, it is not ideal to take out a personal loan just to purchase a car or refinance it. It would be good to just get an auto loan or auto-refinancing loan since this is a secured loan Singapore and costs less than a personal loan.
Final Remarks
As the global market slowly changes its course, governments need to ensure that the public does not suffer in the process. However, even if the government and experts recommend that the public should do its part to help the government improve the economy, the public should not jump immediately to assist.
In this end, try making small contributions by making sound financial decisions such as when to apply for personal loans. By making these decisions, you will be able to help even a little bit and every bit counts.
