Prime Minister of Singapore: "black clouds" on the economic front
by Jeremy Lim
In his speech to the party of independence, Lee Hsien Loong said that the city-state has been able to cope with "well" the crisis. But the future remains uncertain and the "unresolved problems" of Europe and the United States could undermine global growth. On the domestic front the subject of immigrants and an increase in inequality between citizens remains.
Singapore (AsiaNews) - Singapore has been able to "cope well" with the global economic storm, but cannot ignore the "dark clouds" forming on the horizon, said Prime Minister Lee Hsien Loong in his speech marking 46 years of independence of the city-state, earlier this month. He stressed that the nation has faced the worst financial crisis in its history, so the government had to take "resolute and net measures " including the package of measures worth 20 billion Singapore dollars (equivalent to 17 billion U.S. dollars).
The Prime Minister gave reassurances about the solvency of public finances, as opposed to Europe and the United States who have "serious unresolved issues" that pose a risk to global growth. He believes that soon the Greek debt problem will recur, touching on other nations including Spain and Italy. The downgrading of the U.S., however, affects the economy "in the long term," partly because of public spending which is too high and the deep divisions between Democrats and Republicans.
Lee Hsien Loong finally talked about China and emerging countries, who are "doing well" but are "vulnerable" if the United States and the European Union enter into a recession. Among the issues that affect Singapore, he identified the growing health care costs and the cost of housing, in addition to the influence of foreigners - an increasing presence - and people with special needs. In that regard, he assured that social protection will be enhanced, without transforming the city-state into a welfare state such as Greece.
A third of Singapore's 5.1 million inhabitants are foreigners and immigrants, in possession of a permanent visa. Smaller than New York and devoid of natural resources, the city-state in 2010 recorded a Gross Domestic Product (GDP) of 285 billion Singapore dollars (about 231 billion U.S. dollars), up by 14.5% The most significant of all Asia. But wealth is not distributed evenly and inflation forecasts announce a rate of 3-4%, a high figure for the local community. Economic growth has cemented inequality between citizens, an increase of the Gini coefficient - introduced by the Italian statistician Corrado Gini, a measure of inequality of a distribution, ed - which amounted to 0.48 (it was .444 in 2000) in a measure between 0 and 1 (complete inequality).
Last May, the Prime Minister was re-confirmed to lead the executive, after his party’s victory - but it was no triumph – in the general election. The majority party People's Action Party has been a decline in approval since the last elections, in favor of the opposition led by the Workers' Party. Their victory came at the end of the toughest electoral battle since achieving independence in 1965. Prime Minister Lee Hsien Loong, 59, won with a 60.1% margin, significantly down from 66.6% to 75.3% in 2006 and 2001.