Singaporean Economy, Today By Talha Lodhi

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Singaporean Economy, Today By Talha Lodhi

  1. 1. ECONOMY AS OF TODAY
  2. 2. SEQUENCE <ul><li>INTRODUCTION </li></ul><ul><li>TRADE BASED ECONOMY </li></ul><ul><li>ECONOMIC MANAGEMENT PRINCIPLES </li></ul><ul><li>FREE MARKET SYSTEM </li></ul><ul><li>OUTWARD ORIENTATION </li></ul><ul><li>GOVERNMENT, A REGULATOR </li></ul><ul><li>MANUFACTURING SECTOR </li></ul><ul><li>SERVICES SECTOR </li></ul><ul><li>CONSTRUCTION SECTOR </li></ul>
  3. 3. INTRODUCTION <ul><li>Singapore primarily caters for International markets. </li></ul><ul><ul><li>very small local market with a population of 4.8 million only. </li></ul></ul><ul><li>GNP per capita increased manifolds </li></ul><ul><ul><li>Approx. 30 times i.e. from 1567 SD to 46832 SD </li></ul></ul><ul><ul><ul><li>During 42 years of time, in a range of ’65 – ‘07. </li></ul></ul></ul><ul><ul><li>GNP at the time of its formation1567 SD. </li></ul></ul><ul><ul><ul><li>Relatively high. </li></ul></ul></ul><ul><li>Open market </li></ul><ul><ul><li>Policies designed to encourage active participation in setting up new businesses . </li></ul></ul><ul><li>Very low income tax </li></ul><ul><ul><li>To attract skilled foreign labor. </li></ul></ul><ul><ul><li>Boost up economic development potential. </li></ul></ul>
  4. 4. TRADE BASED ECONOMY <ul><li>Emphasis on Trade. </li></ul><ul><ul><li>Import/Export makes 300% of GDP. </li></ul></ul><ul><ul><li>Nil natural resources present. </li></ul></ul><ul><li>Export driven economy. </li></ul><ul><li>Export, nearly 200% of the GDP. </li></ul><ul><li>High volume of Exports indicate high dependency on foreign markets buying power. </li></ul><ul><ul><li>A very critical issue at the time of global recession. </li></ul></ul><ul><ul><li>Singaporean market depends on how well global markets function and sustains. </li></ul></ul>
  5. 5. ECONOMIC MANAGEMENT PRINCIPLES <ul><li>Government as a regulator. </li></ul><ul><li>Economic Management is based on two main pillars </li></ul><ul><ul><li>Free market System </li></ul></ul><ul><ul><li>Outward Orientation. </li></ul></ul>
  6. 6. FREE MARKET SYSTEM <ul><li>Government in principle; </li></ul><ul><ul><li>does not interfere or dictate the strategy evolving terms to market players. </li></ul></ul><ul><ul><li>Ensures uniform distribution and availability of resources. </li></ul></ul><ul><li>No restrictions on foreign business ownership </li></ul><ul><ul><li>Rather encouraged </li></ul></ul><ul><li>Certain restrictions placed in telecomm sector and professional engineering services area. </li></ul><ul><ul><li>For the government intended for the &quot;state-owned&quot; entities to get a grip in the market. </li></ul></ul><ul><ul><ul><li>Before allowing global market competitors to enter the arena. </li></ul></ul></ul>
  7. 7. OUTWARD ORIENTATION <ul><li>Trade to GDP ratio – 300% </li></ul><ul><li>Open to investment and foreign trade. </li></ul><ul><li>Minimal Import Duties. </li></ul><ul><ul><li>96% of the imported products are duty-exempted. </li></ul></ul><ul><ul><li>Raw products imported in, Finished products shipped out. </li></ul></ul><ul><ul><li>The finished product sale covers and boosts the economic deficit caused by duty free import. </li></ul></ul><ul><li>Numerous Free trade Agreements signed with various countries. </li></ul>
  8. 8. GOVERNMENT, A REGULATOR <ul><li>Regulating and overseeing the working of Financial sector institutions. </li></ul><ul><ul><li>Keeping checks and balances to ensure meritocracy. </li></ul></ul><ul><li>Providing the necessary legislative framework </li></ul><ul><li>Creating of a stable business-like environment. </li></ul><ul><li>Investing in infrastructure and manpower </li></ul><ul><li>Streamlining the process of setting up of new businesses </li></ul><ul><li>Facilitating the working of the existing setups </li></ul>
  9. 9. MANUFACTURING SECTOR <ul><ul><li>Comprises one-third of the nominal GDP. </li></ul></ul><ul><ul><ul><li>Electronic items manufacturing forms the major chunk. </li></ul></ul></ul><ul><ul><ul><ul><li>Declining growth rate; 1.5% </li></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>China surfacing as the focal point of electronics manufacturing. </li></ul></ul></ul></ul></ul><ul><ul><li>Net manufacturing sector growth is 12.4% </li></ul></ul><ul><ul><ul><li>Employs a workforce of 21%. </li></ul></ul></ul><ul><ul><li>Shifting focus from Electronics to Bio-Medical manufacturing. </li></ul></ul><ul><ul><ul><li>Growth rate in Bio Medical Manufacturing sector 10.5 % of net manufacturing sector growth of 12.4%. </li></ul></ul></ul>
  10. 10. SERVICES SECTOR <ul><li>Constitutes nearly two-third of the nominal GDP. </li></ul><ul><li>Increased interest in services sector as manufacturing sector shifts to China. </li></ul><ul><li>Employs the majority of the workforce. </li></ul><ul><li>Services sector constitute mainly of; </li></ul><ul><ul><li>Retail trade growing @ 16.7% of services sector. </li></ul></ul><ul><ul><li>Financial Services increasing with 11% growth rate. </li></ul></ul><ul><ul><li>Business services growing at 11.5% </li></ul></ul><ul><li>Health services gaining pace. </li></ul><ul><ul><li>Attracting people globally in general and from Asia Pacific in particular. </li></ul></ul><ul><ul><ul><li>Rapid research and innovation taking place in the sector. </li></ul></ul></ul>
  11. 11. CONSTRUCTION SECTOR <ul><li>6-7% of the nominal GDP </li></ul><ul><li>Major construction projects; </li></ul><ul><ul><li>Land Reclamation, </li></ul></ul><ul><ul><li>Skyscrapers, </li></ul></ul><ul><ul><li>HDB's housing projects, </li></ul></ul><ul><ul><li>Vegas-style Casino strip. </li></ul></ul>

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