Singapore embracing hard times

Reality bites. Singapore is embracing for hard times.

The text of the Singaporean Prime Minister at the eve of their 44th nationald day:

Media Centre  
8 Aug 2009

 1.            Singapore has had a turbulent and challenging year. In January, dark clouds had gathered all around us. Our economy was hit by the worst storm in our history. Exports went down by a third, and manufacturing declined sharply, since we produced for world markets. Given this backdrop, we projected GDP to shrink this year by 6% to 9%.

2.            We could not avoid the storm, but we did not passively resign ourselves to fate. Instead, we mobilized Singaporeans to tackle the crisis together.   We brought the Budget forward to January, implemented a Resilience Package, and drew on past reserves to help fund the Special Risk Sharing Initiative and the Jobs Credit.

3.            We are now in a stronger position. The global economic situation has somewhat stabilised. Our measures have cushioned workers from the worst of the storm. Our economy was among the worst hit, yet we still have one of the lowest unemployment rates in the world. Singaporeans too have responded resolutely and cohesively. These factors helped the Singa­pore economy to bounce back strongly in the second quarter. As a result, growth in the first half of the year was -6.5% – a very significant contraction, but less bad than we had feared. Hence we have revised up our growth projection for 2009.  Our economy will still shrink, but “only” by between 4% and 6%.

4.            But it is too early to celebrate. The outlook remains clouded. The advanced economies are not expected to bounce back soon. Our exports remain much lower than last year, and companies like SIA are still facing very tough conditions. We might see another wave of retrenchments later in the year. So we must stay on guard for more challenges to come.

5.            Beyond this year, we expect the global situation to remain difficult for some time. But the adverse external environment does not mean that Singa­pore cannot grow. We can and must look for new ways to develop and prosper. Opportunities still exist, especially in Asia, but we need all our ingenuity and resourcefulness to find and exploit them.

6.            Businesses and workers are already adjusting to the new world. Many firms are changing their business processes, finding innovative ways to cut costs and generate revenues, and aggressively seeking out new markets. Workers are taking advantage of the SPUR programme to upgrade their skills and retrain for new fields. The unions are cooperating closely with employers to adapt to the changed conditions, instead of resisting change. We must keep this up.

7.            In the midst of recession, as we tackle the immediate challenges, we must also look to the future. The Economic Strategies Committee is studying how we can transform our economy. The Committee will examine how Singapore can find new opportunities, build new capabilities, sustain balanced growth and overcome our constraints. We are involving the private sector, to gather the best ideas that can enable us to prosper. I am confident the Committee will have good proposals when it reports next year. Our responses in the crisis will ensure that once the US and Europe emerge from their troubles, and the world economy recovers, Singa­pore will forge ahead again in a dynamic Asia.

8.            Up close, our current difficulties may appear daunting; but we should see them against a longer perspective. It has been 50 years since we attained self-government in 1959. Over this half century, Singa­pore has encountered many serious challenges – racial riots in the 1960s, oil shocks in the 1970s, a major recession in the 1980s, the Asian Crisis in the 1990s, the 9/11 attacks and SARS in this decade. Each time our people have rallied and prevailed, hence Singa­pore has continued to thrive and prosper, and arrived here today.

9.            We did not start out as one people. Our forefathers were different peoples from different lands, who had come to Singa­pore to seek better lives for themselves and their children. But our formative years fighting for independence, then striving as a new nation to survive against the odds, brought us closer together. Each time we were challenged, we responded as one, everyone pulling together and working for the common good. And each success further cemented our cohesion, and helped us to meet the next challenge.

10.        We are doing this again in this crisis. Everyone of us – government and people, employers and unions – is working together, keeping companies viable and competitive, preserving jobs and livelihoods, and enhancing social safety nets like Workfare and ComCare. Even though this crisis may be a severe test, but our history and record give us confidence that we will once again turn it into an opportunity to strengthen our social compact, and upgrade our economy.

11.        We have responded to the outbreak of Influenza A(H1N1) in the same way. We worked hard to delay and slow down the spread of the new virus in Singa­pore. Our efforts depended not only on the healthcare system and professionals, but also on citizens being vigilant and socially responsible. We bought ourselves precious time to learn more about the virus and gear up our defences.

12.        Whether fighting the recession or the flu, we made sure every Singaporean knows he is not alone, but that the community and the country are behind him. So long as you make the effort and do your best, the rest of us will help you to pull through.

13.        This unity is key to our success in many fields. We must work hard to strengthen it, and to bridge potential divides within our society, be it between Singaporeans and new arrivals, between rich and poor, or most fundamental of all, between the different races and religions. We often see ethnic strife and religious conflicts in other countries. This last year alone, we have witnessed the Mumbai terrorist attacks, and the recent bombings in Jakarta. In Singapore we have to respect each other’s cultures, practices and beliefs, build trust and harmony between our communities, and gradually enlarge the secular common space which all groups share. In this way, we can become one people, one nation, and one Singapore.

14.        We are well placed to deal with these challenges. We are not just pursuing economic growth, strengthening our society, or remaking our city, but creating a new Singapore.

15.        We are improving our living environment, and developing better amenities for the community, more green spaces and park connectors. We are creating more avenues for students to advance and opening up more opportunities to go to university. We are building new hospitals, improving step-down care, and making healthcare more accessible and affordable to all. We are also revitalising the city – upgrading housing estates all over the island, refreshing our downtown into a premier shopping and entertainment venue, and creating a new skyline around Marina Bay, which is taking shape day by day.

16.        My fellow Singaporeans, in the half century since we attained self government, we have been tested many times, but we have also created many possibilities for ourselves. Let us stand shoulder-to-shoulder, so that whether it rains or shines, we can work together and achieve the best results for Singa­pore. This is how we build a better and more vibrant nation, and make Singapore a special place that we are all proud to call our home.

17.        I wish all Singaporeans a Happy National Day


Prime Minister Brig. Gen. (NS) Lee Hsien Loong televised the recorded national day message  on 0715pm Singapore time.

The fact is that being a country is which in the heart of South East Asia, Singapore’s economy is too dependent on the US and Europe. That had always been their focus and Singaporeans aspire to be with the ‘BigBoys’, playing the ‘rich sons games’ instead of ‘play-and-share with the neighbours’. They prefer to trade with the developed markets. Especially when Singapore’s economy moved towards high value added, services (financial and capital markets), high end manufacturing and IP related businesses. As such, merchantile shipping and its derivatives saw a huge reduction. The spiral effect is apparent as property sector in Singapore is heading towards a slump. Asian markets which are more commodities and consumer market based were seen as ‘messy’ and inadvertently, Singaporeans are less interested.

Somehow, when the Western and more developed markets is contracting, even moving towards recession, Singapore suddenly move their focus back to Asia. The fact that China’s and India’s economy is growing at a steady 8% and 6.5% rate respectively in the current global economic crisis. At the current and projected growth rate, China’s economy is expected to over take the American economy by 2027.

The commodity and consumer based diversified economy of most Asian countries make it resilient as compared to Singapore’s, which is too elastic as it is too reliant towards the Western and developed markets. Even the Malaysian economy could see a growth rate of up to 4.5-5% for 2010. In real growth, Singapore’s economy which is dependent on other people’s economy do not posses their own interinsic strength to sustain on their own merits. Being people and IP-based economy which is proven the be very costly in trying times such as this, volatility due to talent migration of the personalities and brain drain would definitely hit the economy hard. The galloping cost of living in Singapore is the known push factor.

The crunch on Singapore’s economy is apparent. Even high chip investments such as Singapore’s pride of SIA is seeing the red for the first time in many years. Temasek Holdings, which reported a massive loss of  SGD 40 Billion which depleted their investments more than 30%. The first half of 2009 saw the -6.5% shrinkage in the once an arrogantly productive economy. This is their worst record in 33 years (considering in 1975, the world economy hit a snag due to the oil crisis).

Whether or not BG Lee’s new strategies to win back the hearts of Asians, in his attempt to minimise further the sliding of Singapore’s economy has yet to be proven. The sentiments of Asians, especially China’s attitude towards the Singaporeans have been non-chalant. The Chinese see the Singaporean (now regarded as ‘distant cousins’) as being ‘Banana’ (Yellow outside, white inside) simply translate that Singaporeans behave, think and posses the attitude  like the Europeans and Americans (with their Neo Con ‘re-colonialisation’ polices of economic domination) despite looking very Asian. The attitude of Minister Mentor Lee Kuan Yew’s ‘Telling people off despite being a guest at peoples’ homes’ really is a minus point for Singaporean businesses to gain footing is places like China.

Singaporeans are never known for the common South East Asia approach of ‘prosper-thy-neighbour’ policy. As it was clearly seen that Singaporeans were actually taking advantage of the Indonesian economic chaos during the 1997-8 Asian financial crisis.  It did not materialised to the intended control only because of the racial riots in Jakarta during the same period which saw too many Indonesian Chinese sought refuge in Singapore.

The fact is that Prime Minister BG Lee used the word “exploit” is reflective of their attitude of ‘parasiting’, rather than working together to co-develop the economy for common good.

The ‘kiasuness’ of the Singaporeans suggest that it is not helping in their current position. It is expected that Asians are very careful when  dealing with the Singaporeans. The fact is that Minister Mentor Lee has been to Saudi and the Gulf states six times in the last two years suggest that the Singaporeans are leveraging on the American ‘dominance’ over the Arabs, especially in economic issues. Prime Minister BG Lee is preparing Singaporeans to realise what they have made themselves to be; a bane to their own success.



Published in: on August 8, 2009 at 20:01  Comments (8)