Mon, Aug 30, 2010
Part 1: Speech from National Day Rally 2010

This is the full speech of Prime Minister Lee Hsien Loong's National Day Rally 2010.

PM Lee: Fellow Singaporeans, good evening.

On the Economy

Our economy has shaken off the recession and is now booming. In the first half, our GDP grew by 18% year on year. Lots of jobs have been created and unemployment has gone down.

Singaporeans can look forward to higher wages and good bonuses. Last year, Singaporeans were very worried about the future. But we have come through the crisis much better and much faster than we expected.

Everyone contributed - the unions, the workers, employers and the government as well did a little bit. So thank you all for a job well done!

While we've come through, we shouldn't forget what has happened.

We better learn some lessons from how we managed the downturn, because despite all our preparations and precautions, some time somewhere something will happen again and there will be future crises and we should be ready for them.

The NTUC attends the International Labour Organisation meeting in Geneva every year in June (ILO). Many unionists have been. And this year the ILO invited NTUC to share with the other delegates how Singapore coped with the downturn and rebounded so quickly.

And their presentation talking about Jobs Credit, on training programmes, on the Resilience Package and so on, generated a lot of interest.

The delegates wanted to know, first, how did we pay for it without having to borrow money, and secondly, how did we build the trust and confidence amongst all the key parties, the unions, the employers, the government.

And in fact these two questions point to the root of our advantage and competitiveness. First of all we built up reserves for a rainy day.

So when the rain came, we could fund our programmes - SPUR and so on - drawing on these reserves with the President's permission but without needing to borrow.

Unlike the Europeans, unlike the Americans, unlike the Japanese, all of which have run up huge deficits, continue to run big deficits and now face very serious problems.

Secondly, we built up our trust over a long period through many shared trials.

And each time there was a crisis, we worked together and we became more confident in each other.

And therefore in this crisis, the workers could accept the sacrifices which were necessary because they were confident that the employers would play their part and both sides were confident and trusted the Government to do the right thing and to take measures which would work.

So together, the tripartite partners pulled Singapore through.

The NTUC is often asked to explain why, how Singapore works, the Singapore way, to other countries, because other people can see how our system works, they want to understand it.

They may be able to understand it but then they want to be able to do it, and that's not so easy. NTUC once invited a delegation to Singapore from one of our neighbouring countries.

We had some Singapore Inc projects there and we wanted to bring the unions on board. So we explained to them how we did it.

And at the end of the visit, the unionist told NTUC: "The day my government behaves like the Singapore government, that is the day my union will behave like NTUC."

So I think that will take some time.

For this year, our growth forecast is 13 to 15 per cent.

It's very very good, but we cannot expect to grow like this for the long term. And also if you see this growth in perspective over a longer time frame, it's not quite so significant as all that.

Let's just take three years - '08, '09, '10.

08 we were +1%, 09 we were -1%; 10 if we're lucky =15%. Plus 1, minus 1, plus 15 is plus 15.

Divided by three to average it out, that means on average we've made over the last 3 years 5% growth. It's not bad but it's not spectacular as what we thought and it's a realistic target of what we can sustain.

So for the next 10 years, if we can make 3 to 5% growth on average every year, I think we're doing well.

So therefore please be careful with wage expectations and have wage flexibility and bonuses but remember, tomorrow it may rain again.

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