Singapore: Economic and Political Outline

Economic Overview

The Singapore economy was particularly affected by the international financial crisis because of its extreme financialization and high degree of openness, and  thus its dependence on international trade. While GDP growth rate was above 7.5% before the financial crisis, it fell sharply in 2009 (-0.8%), before reaching the exceptional degree of 14.5 % of the GDP in the following year, boosted by the regional recovery, strong growth in exports and a strong recovery in domestic demand. Due to supply disruption caused by the Japanese earthquake of March 2011 and the decline in global demand later that year, economic growth in Singapore has again deteriorated. The latest estimates indicate a growth of around 5% for 2011. The uncertainty of a possible crisis of sovereign debt in the eurozone, the continuing difficulties of the U.S. labor market and the U.S. policy of fiscal consolidation make the prospects for 2012 hardly optimistic. The growth rate of Singapore could be between 1 and 3% and the key trade-related areas may experience turbulence.

In the context of a volatile and uncertain external environment, priority is given to supporting economic growth and controlling inflation. To deal with rising property prices and curb demand, the government has introduced a new tax on real estate purchases. After achieving a budget surplus in 2010-2011, the government is now able to introduce tax incentives and relax its monetary policy. Mid-term objectives are the promotion of innovation and productivity gains. To maintain its competitive position despite rising wages, the government seeks to promote activities with high added value (biotechnology, research and development and pharmaceuticals) in the manufacturing and service sectors.

The level of per capita wealth in Singapore is amongst the highest in the region. After a long period of full employment, unemployment has appeared, especially due to structural economic chances (outsourcing of low-skilled work) and worsened during the crisis. However, it has since decreased and now remains at around 2% of the active population.

Main Sectors of Industry

Singapore's economy is highly industrialized. The biggest sector is the manufacturing sector, followed by the wholesale and retail sector, business services, transport and communication and financial services. The electronics and petrochemical industries are dominant. The services sector contributes almost three quarters of the GDP and employs three quarters of the active population. The industrial sector represents a quarter of the GDP. The primary sector is almost nonexistent (except for the cultivation of orchids, vegetables and fish for aquariums). Singapore does not have any mineral resources.

Singapore is a regional trading hub. The Port of Singapore is amongst the world's biggest and is the second traffic center for container transshipment, behind Hong Kong.

Source: World Bank - Last Available Data.

Indicator of Economic Freedom

Score:

87.2/100

Position:

Free

World Rank:

2/179

Regional Rank:

2/38

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Sources of General Economic Information

Ministries

Ministry of Trade and Industry (MTI)
Ministry of National Development (MND)
Ministry of Manpower (MOM)
Ministry of Home Affairs (MHA)
Singapore Economic Development Board (EDB)

Statistical Office

Department of Statistics

Central Bank

The Monetary Authority of Singapore (MAS)

Stock Exchange

Stock Exchange of Singapore

Other Useful Resources

Government of Singapore
Singapore websites

Main Online Newspapers

Online newspapers in Singapore

Economic Portals

Economy watch

Political Outline

Type of State

Singapore is a republic state based on parliamentary democracy.

Executive Power

President is the chief of the state. The role of the president is largely ceremonial. Following legislative elections, leader of majority party or leader of majority coalition is usually appointed Prime Minister by the President as head of the government. Prime Minister enjoys the all the executive powers which include implementation of the law in the country and running the day-to-day affairs.

Legislative Power

The legislature is unicameral in Singapore . The Parliament consists of 84 seats: 9 members of parliament (MPs) are directly elected from single-member constituencies, and 75 are elected in teams of between four and six to represent the 15 Group Representation Constituencies (GRCs). In addition, there are up to nine nominated members.

Parliament is supreme to all other government. The government is dependent on the support of the parliament, often expressed through a vote of confidence.

Main Political Parties

Though Singapore is a multi-party nation, but practically it has been dominated by one-party which has been in power since its independence. It is PAP (People's Action Party).

Opposition parties are allowed, but are widely considered to have no real chance of gaining power. Some of the important opposition parties are:

- SDA (Singapore Democratic Alliance) – a common opposition alliance to fight PAP
- SDP (Singapore Democratic Party) – a liberal democratic party
- WP (Workers' Party of Singapore) – a party of industrial workers.

For more details, consult the list of the political parties in Singapour.

Current Political Leaders

President: Tony TAN Keng Yam (since 1 September 2011) - PAP
Prime Minister: LEE Hsien Loong (since August 2004) - PAP

Next Election Dates

Presidential: August 2017
Parliamentary: May 2017

Indicator of Freedom of the Press

World Rank:

135/179

Evolution:

2 places up compared to 2010

Source: Worldwide Press Freedom Index 2011, Reporters Without Borders

Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).