As Singapore prepares to welcome its new prime minister, Lawrence Wong, next month, he will inherit a robust economy filled with strong local assets. Under the leadership of Lee Hsien Loong since 2004, Singapore has experienced significant economic growth and success in various sectors.
One of the key achievements during this period is the appreciation of its currency against major trading partners, outperforming the US dollar in the same period. Additionally, Singapore government bonds have delivered strong returns, surpassing global peers by about 16 percentage points. This has helped boost investor confidence and attract foreign capital to the country.
During his 20-year tenure, Lee has transformed Singapore into a prominent financial hub and attracted global talent to boost the stock market. The Straits Times Index has outperformed the MSCI Asean Index by nearly 32 percentage points since Lee took office. This success can be attributed to his vision for a knowledge-based economy that emphasizes innovation and entrepreneurship.
However, despite these successes, there are still challenges that need to be addressed to ensure continued growth and sustainability in Singapore’s mature economy. Over half of locally listed companies are trading below their book value, indicating a lack of high-growth firms in certain sectors. Analysts suggest that Wong may need to take steps to support local equities through increased investment from sovereign wealth funds and incentives for listing companies on the Singapore market.
As Wong prepares to assume leadership, there are opportunities for him to further strengthen and support the local economy and market by promoting entrepreneurship and innovation while addressing issues such as income inequality and affordable housing for low-income families. By doing so, he can continue Singapore’s long history of economic success while ensuring that it remains competitive in an ever-changing global landscape.
Overall, Lawrence Wong takes over as Singapore’s new prime minister with a lot on his plate but also a wealth of experience and resources at his disposal. He will need to balance economic growth with social responsibility while maintaining Singapore’s reputation as one of Asia’s leading economies.
