As global monetary conditions tighten, interest rates are set to rise, and small and medium-sized enterprises (SMEs) here should prepare for higher borrowing costs, Minister for Trade and Industry Lim Hng Kiang said on Monday.
"It would not be prudent for the Government to lower borrowing costs for businesses artificially," he said. He was replying to Mr Arthur Fong (West Coast GRC), who asked about the impact of rising interest rates as the US tapers off its third round of quantitative easing.
Instead, the Government will continue to help SMEs raise their capabilities and productivity to cope with the higher costs, said Mr Lim.
Agencies such as Spring Singapore also ensure that credit remains accessible through programmes such as the Micro Loan Programme, he added.
But the Minister also noted that the impact on Singapore is likely to be limited, as the tapering is expected to be gradual and the global market is "likely to adjust in an orderly manner".
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