YIJC 2024 JC2 H2 Prelim CSQ2 Suggested Answers

YISHUN INNOVA JUNIOR COLLEGE JC 2 PRELIMINARY EXAMINATION Higher 2 CANDIDATE NAME CG INDEX NO ECONOMICS Paper 1 Case Study Questions Additional Materials: Writing Papers Cover Pages 9570/01 23 August 2024 2 hour 30 minutes READ THESE INSTRUCTIONS FIRST Write your name, CG and index number on the work you hand in. Write in dark blue or black pen on both sides of the paper. You may use a HB pencil for any diagrams or graphs. Do not use staples, paper clips, glue or correction fluid/tape. There are two questions in this paper. Answer all questions. Start each question (not each part) on a fresh piece of writing paper. At the end of the examination, fasten your work for each question separately. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 8 printed pages and 2 blank pages. [Turn over

©YIJC2024 9570/01/Prelim/24 2 Question 2 Sustainability Efforts in Singapore and China Table 1: Singapore, selected indicators 2019 2020 2021 2022 2023 Real GDP Growth rate 1.35% -3.87% 9.69% 3.84% 1.08% Inflation Rate 0.57% -0.18% 2.31% 6.12% 4.82% Carbon emissions per capita (tons) 5.8 9.3 9.4 8.9 9.46 Table 2: China, selected indicators 2019 2020 2021 2022 2023 Real GDP Growth rate 5.95% 2.24% 8.45% 2.99% 5.24% Inflation Rate 2.9% 2.49% 0.92% 1.98% 0.23% Carbon emissions per capita (tons) 7.5 7.7 8.0 8.0 8.9 Source: https://www.statista.com, accessed 5 August 2024 https://ourworldindata.org, accessed 5 August 2024 Extract 5: Towards a sustainable and resilient Singapore Since our founding, we have designed policies with longterm sustainability in mind. We integrated nature into our Garden City and prudently managed scarce resources such as water and energy. Today, all Singaporeans, rich or poor, young or old, enjoy clean air, water and sanitation, quality healthcare and education, as well as lush greenery and safe common spaces because of these policies. As a tropical small island developing state, we are vulnerable to extreme weather patterns and rising sea levels. We hav e designated 2018 as the Year of Climate Action and taken concrete steps to tackle climate change. We will implement an economy-wide carbon tax from 2019, one of the first Asian countries to do so. Singapore’s carbon tax regime was first implemented from 2019, with an initial tax rate of $5 per tonne of greenhouse gas emissions. This tax rate was in place until 2023. Climate advocates had long said that a carbon tax of $5 per tonne was too low to prompt large emitters to do more to cut their planet -warming emissions. In February 2022, Finance Minister Lawrence Wong said in his Budget speech that Singapore’s carbon tax rate wou ld be adjusted upwards, to $25 per tonne of greenhouse gas emissions in 2024 and 2025. This will be raised further to $45 per tonne from 2026 to 2027, with a view of reaching between $50 and $80 per tonne by 2030. Source: The Straits Times, 3 April 2024 Singapore Voluntary Review Report, accessed 5 August 2024

©YIJC2024 9570/01/Prelim/24 3 Extract 6: Firms tapping Budget 2024 green initiatives can gain from lower costs, business boost Local firms that tap the initiatives announced in Budget 2024 to support them in adopting green solutions can stand to gain from lower set -up costs as well as a boost to competitiveness as suppliers to multinational companies. Industry observers said that enhancements to the Enterprise Financing Scheme and the Energy Efficiency Grant, announced by Deputy Prime Minister Lawrence Wong during his Budget speech on Feb 16, can also bolster Singapore’s sustainability goals. Mr Samuel Han, director of energy and sustainability management at Savills Singapore, said that, “By enhancing the existing schemes, these grants serve as a powerful incentive for businesses to embrace green solutions and prioritise energy efficiency initiatives. This not only promotes environmental stewardship, but also offers tangible benefits for businesses, including cost savings and improved competitiveness.” He added: “By incentivising the adoption of sustainable practices, the grants empower commercial organisations to play a more active role in reducing their carbon footprint and contributing to Singapore’s broader sustainability goals.” First announced in 2022, the Energy Efficiency Grant provides local companies in the food services, food manufacturing and retail sectors with up to 70 per cent of financial support to invest in energy -efficient appliances such as LED lighting, air - conditioners, refrigerators, cooking hobs and water heaters. As part of Budget 2024, the scheme will be expanded to include companies in more sectors, including manufacturing, construction and maritime, as well as data centres and their users. DBS Bank chief sustainability officer Helge Muenkel said: “Additional financial levers such as the tax credit scheme and loans for SMEs to adopt green solutions will also progress the move towards sustainable practices and contribute to fostering a more re silient and sustainable business landscape in Singapore.” Source: The Straits Times, 22 Feb 2024 Extract 7: Advancing China’s Sustainable Economic Growth For the world, the year ahead will require careful calibration of monetary and fiscal policies to secure a soft landing — bringing inflation down while maintaining growth firmly in positive territory. Many central banks have the difficult task of deciding when to cut interest rates and by how much, based on data. They can no longer take cues from others as both the pace of disinflation and growth are diverging across countries. It will be also a challenging year for fiscal authorities in most countries — they need to embrace consolidation to reduce debt and rebuild buffers, and at the same time finance the digital and green transformations of their economies. The good news is that the digital and green transformations present opportunities to boost productivity growth and improve living standards. Deep structural reforms can enhance the conditions for entrepreneurship, innovation and economic performance. Zooming in on China, we saw a strong post -Covid rebound in 2023, with growth exceeding five percent. A key feature of high-quality growth will need to be higher reliance on domestic consumption. Doing so depends on boosting the spending power of individuals and families that is driven by the strong social security system in China that covers pension and insurance for medical, unemployment, work- related and maternity.

©YIJC2024 9570/01/Prelim/24 4 Domestic consumption also depends on income growth, which in turn relies on the productivity of capital and labor. Policies that drive reforms such as deregulating the business environment and ensuring a level playing field between private and state-owned enterprises will improve the allocation of c apital. Investments in human capital — in education, by subsidizing life-long training and reskilling and quality health care will deliver higher labor productivity and higher incomes. This is particularly important as China seeks to seize the opportunities of the AI “big bang.” Countries’ preparedness for the world of artificial intelligence is no longer a goal for the future — it is already an issue for today. The IMF has identified fo ur areas that are critical for countries’ AI preparedness — digital infrastructure, human capital and labor markets, innovation, and regulation and ethics. Our analysis finds that China is at the forefront of emerging economies in terms of A I preparedness, with well-developed digital infrastructure providing a head start. Establishing a robust AI regulatory framework and str