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SINGAPORE: Prime Minister Lee Hsien Loong said Singapore has the resources and the ability to respond if the US economy takes a turn for the worse. In his traditional May Day message to Singaporeans on Wednesday, he urged both workers and employers to make sustainable wage adjustments when they discuss wage payouts.
PM Lee said Singapore workers enjoyed a good year in 2007. The economy was robust, many jobs were created and many workers, especially unionised ones, had the highest bonuses since 1990.
However, PM Lee added that 2008 will be more challenging. But he was optimistic even as he expressed caution over the US and the global economy.
Mr Lee said that the US recession, which many have predicted, has already started. And to him, the question is how long and how severe the downturn will be.
The construction and tourism sectors in Singapore which are doing well could help buffer Singapore's economy from the worst effects of a US recession.
However, he stressed that Singapore workers need to continually refresh their skills to be adaptable in case the global environment changes.
The prime minister also touched on another important issue which is the rising cost of living. He said like other countries, Singapore is affected by higher global inflation and cannot insulate itself from worldwide price increases.
He added that Singapore's policy to keep the Singapore dollar strong has moderated the impact of imported inflation and helped to maintain the purchasing power for Singaporeans.
PM Lee also assured Singaporeans that there are adequate food supplies and that the government will directly help those who are adversely affected by rising prices. For example, over S$3 billion will be given out to Singaporeans this year.
Mr Lee said Singapore's greatest strength in tackling these challenges is its strong tripartite co-operation - among workers, employers and the government.
He said that even though the global environment is in a flux and Singapore is sailing into choppier waters, the economic fundamentals are sound and the country is in a strong position. - CNA/vm
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