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S’pore trims growth forecast to 5-6 per cent

Updated

PM Lee Hsien Loong revises downward S'pore's growth forecast for 2011. (Image of PM Lee's televised speech on Channel NewsAsia.)
PM Lee Hsien Loong revises downward S'pore's growth forecast for 2011. (Image of PM Lee's televised speech on Channel NewsAsia.)

Singapore has revised its economic growth forecast to between 5 to 6 per cent, down from the previous official projection of 5 to 7 per cent.

In his annual televised National Day message on Monday, Prime Minister Lee Hsien Loong said, "Despite some risks on the horizon, we project steady growth of 5-6 percent for 2011."

He noted, the Singapore economy is consolidating its recovery from the 2008 global economic crisis, with the gross domestic product growing at 4.9 per cent in the first half of 2011 and unemployment at a low of 2.1 per cent.

PM's message was recorded a week ago. A statement from his office on Monday said that while the outlook for major economies have become more uncertain since the recording, it is premature to revise Singapore's growth forecast further.

Late last week, there was renewed global financial turbulence after the historic downgrade of the United States' credit rating.

Overall, government policies have worked, said PM Lee. "But despite our best efforts, we could not shield Singaporeans fully from external shocks."

"In a rapidly changing situation, the government had to address the most urgent problems first, stabilising the economy, saving jobs, helping those who were displaced by the crisis," he said.

And while some government policies "did not keep pace", the government has been "tackling the problems", he continued. This includes building more HDB flats, adding MRT lines and buses and moderating the inflow of foreigners.

"We are reviewing our social safety nets to better support Singaporeans in a more volatile environment. The results will not arrive overnight, but we should see improvements over the next few years," he assured.

Staying open, united

During his 10-minute message, PM Lee outlined plans to build the Republic over the long term and urged Singaporeans to remain open and united in the times ahead.

"We should be especially careful of one issue," cautioned PM Lee. "While we will always put Singaporeans first, let us not turn negative on foreigners." Only by staying connected to the world and welcoming to talent and ideas can Singapore thrive, he noted.

He also called on Singaporeans to remain attentive to global trends and "take a longer term view of our future".

"The next few years will bring more rapid changes and surprises," he said, pointing to uncertainty over the global outlook with key economies the US, Europe and Japan struggling to resolve their domestic challenges.

And while the Singapore government has "comprehensive plans" to build the country over the longer term, "the way we manage our affairs must change," said the Prime Minister.

"Our society is changing," he acknowledged. "A new generation of Singaporeans want more alternative voices and more debate on issues affecting them. They seek to play a bigger part in co-creating solutions."

Welcoming Singaporeans to come forward with their plans and ideas, PM Lee said the government would "reach out to all segments of society, to tap your imagination, energy and initiative".

But while having more views would produce a more vibrant society, it can "split and weaken us", he noted.

"We need to enlarge our common space, not magnify our differences and become a house divided. By staying united we can respond effectively to major challenges and continue to outperform other countries," urged PM Lee.

And to younger Singaporeans who have a major part to play in Singapore's growth, the government will "do our utmost to help you succeed", he said.

Wishing Singaporeans a happy National Day, the Prime Minister said, "We are now at a new defining moment in our history."

"In a globalised world, we can stay competitive by raising our education levels and productivity. We can pull ahead by enlarging our talent pool and remaining an open, vibrant society. Most importantly, we can surmount the never-ending challenges of nation-building by looking out for one another and working hand-in-hand to improve all our lives."

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