Will global economic uncertainty help the People’s Action Party in the polls?

Clouds of economic uncertainty hang over the Asia-Pacific. Singapore’s economy is suffering. But the People’s Action Party (PAP) hope heightened global economic fears will bring a boon at the polls.


Unlike in other countries, in Singapore, political manoeuvrings occur away from the prying eyes of the public. The political jockeying that brought Heng Swee Keat to the forefront of the fourth generation (4G) leadership took place out of sight, behind closed doors and off the front pages of the national media.

As a result, political soothsayers rely on detecting subtle signs of impending action; the smallest change in the rhythm of the government’s waltz, a misstep or the over-articulation of a gesture can reveal underlying political manoeuvrings.

Is a 2019 snap election on the horizon?

Which is why when, in his most significant speech since becoming deputy prime minister, Heng announced the creation of “Singapore Together” it sent political sages across Singapore into whispers.

Singapore Together is a public consultation designed to create an “expanded democracy of deeds, with citizens taking action to make a difference,” Heng said. The PAP’s subtle shift towards more participatory democracy may not hold significant meaning on its own, but when viewed in the context of other comments from the Singaporean political leadership, it sheds light on Singapore’s political future.

In addition to Singapore Together, Heng has begun to mention S Rajaratnam’s “democracy of deeds”. In his speech on June 15, then again on June 21, Heng adopted the vernacular of the first foreign minister, calling on Singaporeans to “build a democracy of deeds, where everyone chips in.”

Public consultation on policy, as well as deliberate attempts to foster an environment of unity, coupled with a 2019 budget laden with goodies for lower and middle-income families, have fueled speculation that Lee Hsien Loong is toying with the idea of a snap General Election (GE).

The indicators are there. However, if Lee wishes to hold the election before the end of the year, he would have to announce the move next month.

More likely, he will wait for Heng to complete his first full year as deputy prime minister, let the Singapore Together campaign hold its consultations, and use the data to drive an election campaign ahead of an election in early 2020.

The PAP will bank on stability over uncertainty

Global economic uncertainty is having a knock-on effect on Singapore’s economy. In May, the Ministry of Trade and Industry (MTI) had to narrow its 2019 growth forecast from 1.5-3.5% to 1.5-2.5% after experiencing the lowest growth rate in ten years in the first quarter of 2019.

Disruptions in global supply chains caused by the trade war between the US and China are weighing heavily on Singapore’s export-reliant economy. US export controls have hit electronic chipmakers based in Singapore hard. Shipments to China are also down from previous years.

Container throughput in Singapore’s port also posted a year-on-year fall last month.

Source: Enterprise Singapore

Global economic uncertainty over the trade war, Brexit, and increasing pressure on the World Trade Organisation (WTO) is pushing Singapore to the brink of a recession. The PAP appears to be hoping to capitalise on this uncertainty and use it to its advantage.

Prime Minister Lee Hsien Loong has until April 2021 to call the next vote. But an early election, amid this global unrest, could see voters rally to the PAP in the polls as a beacon of stability. The party has led Singapore for six decades and represents the ultimate vote for continuity amid the seas of global change.

But the PAP has not effectively dealt with the skeletons of its past

In a snap election, the PAP will be looking for a repeat of its 2001 showing, when fears over global terrorism helped the PAP secure 75% of the popular vote.

However, ten years later, in 2011, the party had its worst electoral performance in history, taking 60% of the popular vote. Perhaps most concerningly for the PAP, the issues that plagued it in the 2011 election have not been fully resolved.

Anti-immigration sentiment and increasing economic inequality drove swing voters away from the PAP in 2011. The income gap has increased in real-dollar terms since 2011 and immigration remains a hot-button issue in the island nation.

Source: ValueChampion

Despite the PAP’s efforts to reduce the volume of immigrants, facilitate integration and promote a “Singaporean Core” in society, 48% of young Singaporeans still believe too much foreign talent dilutes the cohesiveness of society. In 2010, this figure stood at around 38%.

Heng is championing the merits of immigration and foreign workers but will want to avoid giving the issue too much publicity.

Singaporean’s wallets will make a more convincing argument

Voters will likely be far more convinced by the size of their wallets than increasing global uncertainty. In this regard, the PAP is well-placed to ensure it enters a 2020 election on a high.

Although wealth inequality in real-dollar terms is up, lower income bands have experienced faster growth in percentage terms. Since 2007, the lowest 10% of earners have seen their income increase by 65.4%, while the highest decile has enjoyed a still-sizeable salary boost of 54.2%.

Older Singaporeans born in the 1950s will also begin reaping the benefits of the Merdeka Generation package in July. The multi-billion-dollar package will help with the healthcare costs as they enter retirement.

The party is carrying open wounds from 2011. Income inequality is rising, and the leadership will want to avoid a dogfight over immigration at all costs. But if an election is held while Singaporeans are still revelling in the windfall of Merdeka Generation and the festivities of this year’s bicentennial National Day celebrations in August, the PAP should be able to put in a strong showing.