Singapore's Economic Recovery?

A regional, if not world, trade recovery has begun and looks set to continue unabated into 2010. Singapore's economy surged for a second straight quarter, and the government revised its 2009 growth forecast after confidently emerging from the recession.

The strengthening economic and earnings growth numbers did not shrug off the drudgeries and negatives like the slow but stabilizing job losses in Q209. 5,980 workers lost their jobs in the second quarter of 2009 which is no consolation that this is less than half the number seen in the previous quarter this year. Accordingly, there are 31 to 33 openings per 100 job seekers and the labor market is likely to remain weak till the end of 2009.

Consumer confidence in large asset categories like properties, COEs and shares is not showing any sign of weakness and is showing sustainable strength over the last 2 quarters. This shows the gasping disparity between the haves’ and haves’-not reaction to an imminent economic recovery. The jobless workers are still looking for a job while those in better discretionary positions are betting forward in large asset categories. Hence, the trickle-down effect has not reached the base of the pyramid for the average Singaporeans to feel the effect of growth.

Personally, I would characterize our first half year performance as solid with a broad based focus on key industries like service and manufacturing. During the last three quarters, we have been driving for operational efficiencies, managing our working capital to meet the needs of the business and improving our relationships with our key customers. All our efforts, with financial and organizational discipline, enabled us to be fitter, nimbler and more responsive. Overall, we are confident that our profitable growth is sustainable in the next three to four quarters.

The economy is definitely heading northward and the relentless drum-beat of good economic news should continues into 2010.