Singapore's economy grew 2.8 per cent in 2014, incomes rose: PM Lee

Prime Minister Lee Hsien Loong

SINGAPORE - The economy grew a "moderate" 2.8 per cent in 2014 as productivity gains remained weak for a third straight year, Prime Minister Lee Hsien Loong said on Wednesday.

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Here is the New Year message by Prime Minister Lee Hsien Loong:

2014 has been an eventful year. We have seen rising nationalism lead to tensions in our part of the world, and even to conflict in Ukraine and the Crimea. The Ebola outbreak in West Africa is still far from under control. Terrorism continues to loom large: ISIS in Syria and Iraq is a new breeding ground, and even smaller-scale, lone-wolf attacks like the hostage taking in Sydney can be very worrying.

We have also experienced several air tragedies close to home, most recently the loss of AirAsia flight QZ8501 from Surabaya to Singapore. Our thoughts and prayers continue to be with the loved ones of those on board.

As Singapore prepares to celebrate our 50th birthday, we are reminded that stability, safety and security are precious, and a pre-requisite for safeguarding what we have, and reaching for a better future. SG50 will be a time to look back, give thanks for what we have achieved, and look forward to the future with confidence.


Our economy has performed moderately well in 2014. Growth was 2.8 per cent. Real median incomes continued to rise, leading to a 10 per cent increase over the last five years. Unlike many developed countries, we are not facing unemployment and stagnant wages. We can take heart from this.

However, our productivity performance has been disappointing. For the third year in a row, productivity growth has been weak. For the first three quarters, it is negative: -0.5 per cent. We must do better. Otherwise, our incomes cannot continue to rise, and will soon stagnate. We must redouble our efforts to help companies and workers upgrade, and become more productive.

Even then, our growth will be slower than we are used to. One reason for this is that we have been tightening policies, including on foreign workers, to get our economy onto a path of sustainable, productivity-driven growth.

But please remember that economic growth remains important. Those who say that it is unimportant are gravely mistaken. Growth is not the be-all and endall, but it is the only way for us to create good jobs for all and earn a good living, so that as a nation we can invest in our people and our future. It opens opportunities that give us a sense of hope, and the confidence that our lives can improve with each passing year.


Growth also gives us the resources to improve social wellbeing and sustain our social safety nets. This has been a major priority as we make fundamental policy shifts to prepare for the future.

These shifts will give Singaporeans at each stage of life greater assurance, more opportunities, and a better home. 8. First, to give Singaporeans greater assurance, we introduced the Pioneer Generation Package (PGP). The response has been good.

Our pioneers are happy that in their golden years their sacrifices and contributions are being honoured. Their children and family members are also happy as their load too has been eased. The government has set aside sufficient funds to keep its promise to our pioneers.

Another major initiative - MediShield Life - will come into effect in 2015. This will give all Singaporeans better healthcare coverage for life. Both PGP and MediShield Life will help make Singapore a more fair and just society, where risks are shared, and the vulnerable among us receive more help.

Because of these new schemes, social spending is rising steadily. We have been prudent in the past so we can afford the new programmes we are launching. But we must remain disciplined and grow our social programmes in a way which can be sustained well into the future. We must never mortgage our children's future for our present comfort.

Second, we must create more opportunities for Singaporeans, so that all can achieve their aspirations. We will continue investing heavily in early childhood education, making every school a good school, and building a strong and diverse tertiary system through our ITEs, polytechnics and universities.

This also means enabling Singaporeans to learn and develop expertise continually. Wherever we are in life, and whatever our job, we should have pathways to improve and succeed. This is what lies at the heart of SkillsFuture.

We must fundamentally change mindsets about progression, upgrading, and success. Learn to value individuals for their different skills and contributions, and not just for their academic performance. Work together as one Singapore team. Together, our potential is limitless.

Third, we are building a better home for all Singaporeans. 28,000 families collected the keys to new HDB flats this year; 26,000 more will do so next year. 550 more buses are already plying our roads, with more to come. In the coming years, we will see new MRT lines, more trains, and more frequent train services, especially at peak hours. In our urban environment, we are creating special places in every corner of Singapore, from the Jurong Lake District to Mandai. Through our Smart Nation initiatives, using IT to the full, building upto- date IT networks, and making them accessible to all, we will improve our quality of life, create new opportunities and strengthen community bonds.

But home is more than just good infrastructure, beautiful surroundings and convenient amenities. Ultimately, home is about family and relationships. All of us desire to have loving families with strong bonds and ties. We also want to reach out to others and build strong communities, as one big Singapore family and one united people.


2015 marks the 50th anniversary of Singapore's independence. We have prepared something special for all our Jubilee babies. The SG50 Baby Jubilee Gift is our way of celebrating the joy of parenthood with families and represents our collective best wishes to the next generation. Into their hands we entrust Singapore's future.

We must continue to nurture in this new generation and those who come after, a desire to do better for themselves and for others, a keenness to press ahead and a confidence that we will prevail.

The road ahead appears daunting: intense competition and greater inequality because of globalisation and technological advances, security threats from extremist terrorism, new pandemics are just some of the challenges. In many countries, people are feeling angst, anxiety and despondency about the future, especially the young.

But in Singapore, we can have a well-founded confidence about our future. While others are cutting unaffordable social spending, we are strengthening our programmes to take care of every Singaporean, young and old, in a sustainable way. While others struggle with breakdowns in public services and pension systems, we are investing to improve ours. We may have much work to do to overcome our challenges, but we have the ability, drive and determination to do so.

How we deal with our challenges will decide what sort of country we will become. We can realise our vision of a fair and just society and a nation of opportunity if we confront our challenges squarely, and fight for our place in the world. We must not succumb to mediocrity.

It is not good enough for Singapore to be an ordinary country. Our pioneers came to our shores with great hopes for a better life. Each succeeding generation can do better. We must have faith that better days lie ahead.

We have come thus far because the Government and People have worked hand in hand. We will succeed if we unite our strengths and abilities. Let us not wait for others to do everything for us. Let us each do our part and give it all that we can. Let us come together to take Singapore to greater heights. Then, we can achieve greater assurance, create more opportunities, and build a better home for all.

I wish all Singaporeans a very happy New Year.

Thank you.