The importance of the maritime industry in Singapore is significant, which is exactly why the Singapore government has decided to provide a considerable amount of financial support for the offshore industry that has been in sharp decline in just the last year or two.
Because of a variety of different economic factors there some completely unforeseen and uncontrollable) the offshore industry in Singapore has been hammered as of late. An economic downturn has sharply decreased the prices of offshore oil and gas, creating a lot of turmoil in the industry – so much so that the Singapore government has decided to step in and help to prop up the offshore industry until the tide can turn back in their favor once again.
The offshore oil and gas industry are in a sharp decline
According to reports released by the Ministry of Trade and Industry, a system of bridging loans for the marine and offshore engineering companies operating throughout the Singapore area are going to be modified and expanded as well as reintroduced the International Enterprise Finance Scheme to improve the benefits available to the offshore oil and gas industry.
This is all done in reaction to serious economic downturns that have occurred in the offshore oil and gas industries. As prices drop across the world, profits also drop for these companies – and they aren’t the only ones getting hit hard.
The maritime industry in general is significant in Singapore, with a number of companies providing harbor services, shipping and transportation services, marine and offshore engineering services, exploration and production companies, and so much more all being negatively impacted by this significant downturn.
The Minister for Trade and Industry is committed to propping up the offshore industry
Without choosing to prop up this offshore industry, it’s conceivable that the Singapore economy – which has been steadily growing for a number of years now – would have hit a major bump in the road and slowed down the overall growth plan that the government of Singapore has been working so hard on for the city state.
By choosing to offer new loans as new components in the traditional financing scheme already provided to the offshore industries, the Singapore government hopes to be able to provide these operations with enough relief for them to “float” these rough and rocky times until the prices for offshore oil and gas are able to rebound again.
The Singapore Shipping Association has praised the move
Small and large businesses alike have been very vocal in their praise of this decision, but the Singapore Shipping Association has probably been the most vocal of them all. This organization was integral in the development of the new financing plan for by the Singapore government, and they helped to guide the government through this process to make sure that all businesses related to the maritime industry be equally supported – and not just the “drillers” of the business.
It’s impossible to know exactly what kind of impact these decisions will have in the long term, but the Singapore government doesn’t usually make mistakes or missteps when it decides to get involved in the major industries of their nation.
About the Author
Morris Edwards is a content writer at companyregistrationinsingapore.com.sg, he writes different topics like Launching a startup in Singapore? 4 things you need to know and The Most Innovative Economy In Asia and all topics related to Business, Economy and Company Incorporation in Singapore.