A rising number of Singaporean business and political leaders expect economic growth to slow significantly over the next decade as the country adjusts to being a rich, developed nation, signalling a possible end to Singapore's multidecade run as one of the fastest-growing economies in the world, reports the Wall Street Journal.
The latest subdued forecast came Monday, when a group of government and corporate leaders headed by Singapore's finance minister said the country would struggle to achieve 5% growth over the next decade.
Their projections, in a report on the future of Singapore's economy,
are below past rates of growth, which averaged slightly above 8%
between 1960 and 2000.
Maintaining rapid growth is seen as key to making sure an already-wide gap between rich and poor doesn't get worse in Singapore and possibly lead to social unrest.
Singaporean companies have posted productivity levels that are below those in other developed countries—a problem that could translate into lower standards of living than other wealthy nations in the long run…
Even with slower growth, Singapore remains in an enviable position compared with other Asian nations, in part because of its continued reputation for modern infrastructure and clean government.
"Singapore is still sitting in a pretty sweet spot as a hub for international companies serving the Asian market," said David Cohen, an economist with Action Economics, a consultancy in Singapore.
"I should think they should be able to ride that status and still post growth that's faster than the U.S. and Europe," he added.