Economic Progress in Singapore

Running head: REPORT ON ECONOMIC PROGRESS IN SINGAPORE
Report on Economic Singapore in India
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1REPORT ON ECONOMIC PROGRESS IN SINGAPORE
Table of Contents
Introduction......................................................................................................................................2
Current Event...................................................................................................................................2
GDP Highlights...............................................................................................................................3
Labour Market Analysis..................................................................................................................4
Price Movements.............................................................................................................................5
Conclusion.......................................................................................................................................6
Reference.........................................................................................................................................7

2REPORT ON ECONOMIC PROGRESS IN SINGAPORE
Introduction
Singapore has been a strong country economically and to keep the good economic
condition it is necessary to implement effective policies regularly. Therefore, thorough
information and analysis is required to make effective policies. Therefore, the report discusses
and analyses the important aspects of economy of the country. The aspect that the report focuses
on are a current event that affecting the country economically, economic indicators like gross
domestic product, labour market with special emphasis on employment and movements in price
level. Therefore, the report discusses about the economic progress in Singapore to help the
government to devise effective policies.
Current Event
Many events are occurring or has occurred recently in Singapore but the event that has
acquired the most important status is the outbreak of Corona virus. It is more appropriate to state
the event as a national issue as it is spreading fast. So far the number of people diagnosed with
Corona virus is 58 (The Star Online 2020). Experts are afraid that the outbreak of the disease
might take the form of an epidemic considering the case of Corona virus in China. It is estimated
that the economic impact of Corona virus outbreak is going to be worse than the SARS pandemic
occurred in 2003. The impact would be on the tourism sector and there would be huge fall in
number of tourist travelling to Singapore in near future. As per a report by the DBS Group
Holdings, there will be less tourists visiting Singapore this year and the number of fall in tourists
could be 1 million. Such a big fall in number of tourist will possibly lead to loss spending in the
sector worth $1 billion (South China Morning Post 2020). Therefore, such a loss of revenue
would hurt the economy of Singapore. In addition to that, the government of Singapore is going
to announce economic package to encounter and alleviate the problem of Corona virus outbreak

3REPORT ON ECONOMIC PROGRESS IN SINGAPORE
in the coming budget (The Strait Times 2020). Therefore, loss in income and rise in spending is
going to affect the economy adversely with fall in economic growth. (250 words)
GDP Highlights
Figure 1: GDP growth rate in Singapore
Source: (Created by the Author)
GDP growth rate is an important economic indicator and thus its study is important. From
figure 1, it can be observed that there had been several instance where the country had faced
negative growth in GDP (Tan 2016). The data of GDP growth rate since 1980 show that there
had been 3 years in which the country had faced negative GDP growth rate and they were 1985,
1998 and 2001. However, the cause of negative GDP growth rate had been different in different
years. The cause of negative GDP growth rate in 1985 was recession (Eaton et al. 2016). Again,
negative GDP growth happened in 1998 and it was due to the Asian Financial Crisis. In 2001,
the economy of Singapore faced negative GDP growth again and that happened due to decline in
electronic industry and dot-com bust. (150 words)
1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
GDP Growth Rate
Year
GDP Growth Rate (%)

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Labour Market Analysis
Figure 2: Distribution of employment in Singapore
Source: (Created by the Author)
Figure 2 shows the employment distribution in major industries in Singapore and they are
manufacturing, construction, services and others. After studying the figure, it can be observed
that service industry provides the maximum percentage of employment to the employed residents
of the country (Hsia and Chau 2018). Then comes the manufacturing industry but the percentage
is significantly lower than the service industry. At the third position comes the construction
industry as per the amount of employment provided by the sector to the employed residents of
the country. The employment share for others is so low that the bar of the sector is almost not
visible in the figure. The amount of employed residents that worked in service industry in
Singapore in 2008 was 76%. In the case of manufacturing industry, the amount was 17%. In the
construction industry, the amount was 6% and in other sectors, the amount is only 1%.
Employment percentage in 2018 has increased for services industries only. The percentage of
residents employed worked in the service sector has been 84%. On the other hand, the
2008 2018
0.0
500.0
1,000.0
1,500.0
2,000.0
2,500.0
Employed residents Manufactruing Construction
Services Others
Year
Employment (in thousand)

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manufacturing industry experienced the maximum amount of percentage decline in employment
in 2018 in comparison to 2008, which is 27%.
Price Movements
Figure 3: Inflation rate in Singapore
Source: (Created by the Author)
In figure 3, the inflation rate of Singapore from February 2017 to October 2019 has been
shown. It is evident from the figure that the even though the inflation rate is not high but there is
an upward trend and due to that, the inflation rate increased for 0.2% in February 2017 to 1.4%
in October 2019 (Brunnermeier and Sannikov 2016). However, it should be noted that the
inflation rate shown in the figure is monthly inflation rate. The inflation rate that occurred in
October 2019 in Singapore is due to housing and utilities, food, food servicing services,
communication, miscellaneous good and services and education (Clark, Ghosh and Hanes 2018).
However, the contribution of communication service in raising the inflation rate in Singapore in
October 2019 is the highest.
2017 Feb
2017 Apr
2017 Jun
2017 Aug
2017 Oct
2017 Dec
2018 Feb
2018 Apr
2018 Jun
2018 Aug
2018 Oct
2018 Dec
2019 Feb
2019 Apr
2019 Jun
2019 Aug
2019 Oct
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1.40%
1.60%
Months
Inflation rate (%)

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Conclusion
The above discussion about economy of Singapore with special emphasis on current
event, GDG, labour market and price level it can be inferred that the country has been
performing well with few number of disturbances in the economy. However, the recent outbreak
of Corona virus has put the economy of Singapore at stake and it is estimated that the outbreak is
going to take a toll on the economy of the country. Therefore, immediate and effective
governmental policies are required to encounter the current problem.

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Reference
Brunnermeier, M.K. and Sannikov, Y., 2016. On the optimal inflation rate. American Economic
Review, 106(5), pp.484-89.
Clark, A., Ghosh, A. and Hanes, S., 2018. Inflation expectations in Singapore: A behavioural
approach. Macroeconomic Review, 17(1), p.89.
Eaton, J., Kortum, S., Neiman, B. and Romalis, J., 2016. Trade and the global
recession. American Economic Review, 106(11), pp.3401-38.
Hsia, R. and Chau, L., 2018. Industrialisation, employment and income distribution: A case
study of Hong Kong. Routledge.
South China Morning Post. (2020). Coronavirus: Singapore braces for economic hit with ‘strong’
spending package. Available at:
https://www.scmp.com/news/asia/southeast-asia/article/3050208/coronavirus-singapore-braces-
economic-hit-strong-spending.
Tan, A.H., 2016. Economic prospects of Singapore. In SINGAPORE 2065: Leading Insights on
Economy and Environment from 50 Singapore Icons and Beyond (pp. 213-218).
The Star Online. (2020). Eight new Covid-19 cases detected in Singapore. Available at:
https://www.thestar.com.my/news/regional/2020/02/14/eight-new-covid-19-cases-detected-in-
singapore.
The Straits Times. (2020). Budget next week will include 'strong' package to counter coronavirus
fallout: Lawrence Wong. Available at: https://www.straitstimes.com/business/economy/budget-
next-week-will-include-strong-package-to-counter-coronavirus-fallout.

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