Recession confirmed: Tharman

[downgrader]

Finance Minister Tharman S has confirmed that Singapore is headed towards several quarters of recession.

If you have not tightened your belts, do so now.

If you have not DOWNGRADED, what are you waiting for?


http://www.businesstimes.com.sg/sub/news/story/0,4574,299833,00.html?

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Published October 6, 2008

Slowdown to last several quarters
But strong fiscal position, diversity will help Singapore weather economic crisis: Tharman


By JAMIE LEE

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(SINGAPORE) Singapore's economy is expected to slow for 'several quarters' as the sub-prime meltdown has evolved into phase two - an economic crisis, said Finance Minister Tharman Shanmugaratnam.


With Singapore's heavy exposure to the global economy, the country is unlikely to be spared from the expected slowdown across the world, said Mr Tharman, who was speaking to Toa Payoh East residents during a dialogue session yesterday.

'We are now entering the second phase of the crisis,' Mr Tharman told the residents.

'It is no longer just a financial crisis. It is now an economic crisis,' he added, pointing to slowing growth in the US, Europe, Japan, India and China.

'We will also see a slowdown, from all indications, that will last not just one or two quarters, but may last several quarters because we are heavily exposed to the global economy.'

But he expects the country to ride through the crisis with its strong fiscal position and a diversified economy.

'The government is in a strong fiscal position,' he said. 'Frankly, it's just as well that we decided not to spend all of the surplus that we earned last year. We spent some of it, provided some support for households, but we kept some dry powder.'


He said that some sectors, such as the shipping industry and the high value-add manufacturing businesses, continue to thrive despite the crisis. And while the financial sector is expected to slow down, some segments, including private banking and wealth management, continue to show strong growth.

The minister added that although job creation will be affected in the next few quarters, Singapore's starting level of unemployment is much lower those that of other countries.

He noted that the approved US bailout package was just the beginning of work needed to get the American economy back on track.

'Globally, we were relieved that the US Congress came to a decision to support the package because it helps (to) take us forward,' he said. 'The consensus is that more will have to be done.'

Responding to queries on the recent 21 per cent jump in electricity tariffs, Mr Tharman said that next year's utility rebates would factor in this price hike - the sharpest in eight years. 'We know the large increase in the fourth quarter has unsettled many people. We'll take that into consideration in next year's budget.'

The minister said that the increase had been reasonable compared to the estimated 45 per cent spike in oil prices over the last one year. 'Let the realistic price be charged, based on the world market price. But, help our poor people. Those who are wealthier have to pay the world market price.'

Mr Tharman added that that there was a good chance that tariffs could go down if current fuel prices continue stabilising.

When asked if banks could be pushed by the Monetary Authority of Singapore (MAS) to disclose their exact exposure to failed structured products linked to bankrupt Lehman Brothers, Mr Tharman told reporters that there needs to be a balanced use of regulation.

'We've got to avoid swinging in pendulum-like fashion when it comes to regulation,' he said.

He declined to say if there would be further economic growth revision or if the MAS would ease the Sing dollar policy - a consensus forecast by most economists.

 

[downgrader]

Repeating what I have said many times in the old and new forums....

People must get used to the idea that recession is not a bad thing.

It is a good thing, really. I am not indulging in irony or sarcasm

Recession teaches people true values, not blind consumerism, bind people together through helping each other

 

[downgrader]

Hot News // Monday, October 6, 2008

http://www.todayonline.com/articles/279796.asp

Grey skies ahead
Expect slowdown over several quarters, more job losses: Finance Minister


Neo Chai Chin


[email protected]


SINGAPORE will suffer an economic slowdown lasting “several quarters” and unemployment is expected to rise, Finance Minister Tharman Shanmugaratnam warned yesterday at a dialogue with community leaders and residents in Toa Payoh East.
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What had begun as a financial crisis in the United States last year has now spiralled into a global economic crisis to which Singapore is exposed, even after the United States government approved a US$700-billion ($1-trillion) rescue package to bail out America’s banks and financial institutions, he noted.
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Responding to a resident who had sought his thoughts on the bailout, Mr Shanmugaratnam said that while it was a step forward that the US Congress supported the plan, “I think the consensus is that more will have to be done”.
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The real problem facing the US financial system is the shortage of capital in the banks there because the value of their assets has been sharply eroded, he said. America’s next President and his team will have to work out a “comprehensive” solution to its financial problems, he added.
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The year ahead will be “difficult” and “things will get worse before they get better”, Mr Shanmugaratnam warned.
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The Ministry of Trade and Industry will announce preliminary estimates for third-quarter gross domestic product this Friday, and the Monetary Authority of Singapore (MAS) may also announce a monetary policy update then, said Mr Shanmugaratnam, who is also a board member of the MAS.
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Despite the grey skies, there are bright spots on thehorizon, the minister said. Singapore’s diversified economy will enjoy continued growth in sectors such as offshore and marine, private banking and wealth management, as well as in certain areas of manufacturing. Confidence in Singapore is still high, and “our property market is not as overvalued as that in many other countries”, he said.
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Last year’s budget surplus will also benefit Singaporeans, he told the 300-strong audience.
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“Frankly, it was just as well that we decided not to spend all the surplus that we earned last year,” he said.
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“This shows the merits of thinking not just short-term, but medium- to long-term and not spending all your resources immediately.”
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Mr Shanmugaratnam assured residents that Singapore’s regulations over local banks, offshore banks and insurance companies were sound, but acknowledged that it was natural for Singaporeans to be nervous amid the global uncertainty.
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“There’s no risk and no reason whatsoever to have a run on our banks,” he assured.
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On calls to expand the insurance coverage of bank deposits from the current $20,000 ceiling, Mr Shanmugaratnam said that would mean higher costs because the cost of deposit insurance would ultimately be borne by the customer. He added that deposit insurance was the last step in the process, not the first.
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“The first step is, the banks have to be well-regulated and I can assure you that our Singapore banks are well-regulated,” he said.
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“Our regulations are stricter compared to Ireland, the US, in fact compared to many developed countries. We have always been old-fashioned in our regulatory approach.”
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Still, he agreed with grassroots leader Peter Ngo that the credit card system might need more oversight. Mr Ngo, 70, the chairman of listed company E3 Holdings, said he knew someone earning $10,000 a month who had been granted a total of $160,000 in credit facilities by eight different banks. With share prices plunging and economic prospects worsening, more people may resort to borrowing from one bank to repay another, causing future problems as the debt spiralled out of control.
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Financial experts suggested to Today how consumers might be better protected.
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Former NTUC Income chief executive Tan Kin Lian suggested that the MAS require all banks to provide data on credit cards taken by each person and for a central database to be set up. Save for the rich, each person should be limited to two credit cards with a total limit of two months’ salary, said Mr Tan, a consultant who also blogs about financial and insurance matters at tankinlian.blogspot.com. As it stands, the Consumer Credit Bureau allows banks to check a potential client’s credit and payment history before issuing new cards or unsecured loans
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Mr Leong Sze Hian, president of the Society of Financial Service Professionals, said that instead of leaving consumer education to banks and the Consumers Association of Singapore, parties like financial service trade associations and Credit Counselling Singapore could be roped in. A compulsory debt restructuring scheme — for which a consultation paper was issued last year — would also help in preventing bankruptcy, he said.

 

[downgrader]

Home > Breaking News > Singapore > Story

http://www.straitstimes.com/Breaking+News/Singapore/Story/STIStory_286417.html
Oct 6, 2008
Economy may slow
But strong fundamentals will see Singapore past global crisis: Tharman
By Li Xueying, Political Correspondent

The crisis has moved into what Finance Minister Tharman calls its 'second phase'. 'It's no longer just a financial crisis,' he said. 'It is now an economic crisis.' With growth slowing in the US, Europe, Japan, and even China and India, it is now a global slowdown, he said. -- ST PHOTO: SAMUEL HE

HEAVILY exposed to the global economy, Singapore will see an economic slowdown that could last 'several quarters', not just one or two quarters, said Finance Minister Tharman Shanmugaratnam yesterday.
In tandem, unemployment is expected to increase.

But he also sounded a note of optimism, saying with its strong fundamentals, Singapore will ride out the crisis - and emerge better than most countries.

Mr Tharman was addressing some 300 grassroots leaders and residents of Toa Payoh East, after a three-hour walkabout which saw him, among other things, opening an exercise corner for the elderly.

Accompanied by MPs from the Bishan-Toa Payoh GRC, including Mrs Josephine Teo, it was his first ministerial walkabout since taking charge of the finance portfolio this year.

During the 80-minute dialogue that followed, residents asked 13 questions covering topics from foreign talent to greater rewards for grandparent caregivers.

But the focus was on the darkening economic outlook amid increasingly gloomy news from the United States - and the world - on what some have termed 'the worst financial crisis since the 1930s'.

So grassroots leader Raymond Teo, 39, wanted Mr Tharman's opinion of the US$700 billion (S$1 trillion) package to bail out troubled financial institutions in the US, and how it impacts Singapore.

The minister expressed relief that the US Congress had supported the package, as it is a step forward.

But it is 'not a full solution' in addressing the real malaise: shortage of capital in the banks, he noted. This, the new US President would have to work out when he takes over in January.

And because the problems are 'deep and extensive', it will take 'a year or two' before the world emerges from the crisis, he later told reporters.

Meanwhile, the crisis has moved into what he calls 'its second phase'.

'It's no longer just a financial crisis,' he said. 'It is now an economic crisis.'

Growth is slowing in the US, Europe, Japan, and even China and India, he noted. 'So globally the economy is slowing down. This is a fact we cannot escape.'

Thus, Singapore 'will see an economic slowdown which, from all indications, will last not just one or two quarters, but may last several quarters, because we're heavily exposed to the global economy'.

But he stressed that Singapore is armed with strengths that will see it safely through the crisis.

First, the unemployment rate is low.

So while fewer jobs will be created in the next few quarters, the starting level is 'much lower' than most countries.

Second, Singapore has a diversified economy.

'Some sectors are still doing well,' he said, citing marine engineering, construction and manufacturers of high-value products. Even in the embattled financial services industry, wealth management and private banking are doing well.

Third, the Government is in a strong fiscal position, 'and we'll be able to take the necessary actions if the situation turns much worse'.

He said: 'Frankly, it was just as well we decided not to spend all the surplus that we earned last year.' Part of it was given to Singaporeans as Growth Dividends.

'This crisis shows the merits of thinking not just short-term but medium- to long-term,' the minister added.

Exuding confidence about the country's strong fundamentals, he told Singaporeans to keep their eye on the medium- to long-term future, as the short-term problems can be dealt with.

'If we keep our focus on education, continuous training, and attracting new investments and new industries here - which is what we're doing - Singapore will continue to do well.

'So we'll ride through the down cycle ...I feel we're going to come through it better than most countries - not just in the region but even most developed countries.'

Asked for the full-year economic growth forecast, he said the Trade and Industry Ministry will reveal the numbers on Friday. Trade and Industry Minister Lim Hng Kiang had warned growth might dip 'a bit below' 4 per cent this year.

One resident, technician Ali Khan, 43, said he was assured by Mr Tharman's replies, as he and his friends had been worried about their job security.

'It gives me some confidence that despite the downturn, we'll be all right in the long run.'

[email protected]

 

[nitecrawllerr]

One resident, technician Ali Khan, 43, said he was assured by Mr Tharman's replies, as he and his friends had been worried about their job security.

'It gives me some confidence that despite the downturn, we'll be all right in the long run.'

Sigh..some makal/natah can be so naive. No one can guarantee our ricebowl are safe! Yes, not even Tharman deh!

 

[STUCK_HERE]

We pay him S$3M a year to state the obvious - like "Shit is smelly".

All you bloody stupid singkie slaves out there. Just note this. Whenever things go sour, you have to get ready while the MIW continue to enjoy life with their million $ salary and all the FTs didn't get nagged and continue their wonderful life.

 

[The_Latest_H]

Tharamn says slowdown; funnily enough, way before Black Monday 3 weeks back, President Bush also said that America was in a slowdown, but refused to say it was a recession.

http://edition.cnn.com/2008/POLITICS/02/28/bush/index.html

Something tells me that Tharman is sugarcoating, so as to mislead and manipulate people. Its time Tharman stop behaving like Bush Jr, and state it as it is. Call a spade a spade, Mr. Tharman. Stop fooling around.

One resident, technician Ali Khan, 43, said he was assured by Mr Tharman's replies, as he and his friends had been worried about their job security.

'It gives me some confidence that despite the downturn, we'll be all right in the long run.'

I paraphrase Sen. Obama, "Not if you keep on doing the same thing over & over again for the last twenty years, and somehow expect a different result."

 

[suteerak1099]

notice, most of the speeches from MIW is about assurance for long term - which is not all that bad after all. but before we ever reach the objectives in the long terms, we musnt 4get the short & mid term milestones too. have we heard enough assurances for the short & mid term goals, so to shape & materialize the long term??

from the looks of things, its been nothing but emphasis about long term goals, while life remains a turmoil for all the days from now till the long term objective is achieved.

 

[The_Latest_H]

notice, most of the speeches from MIW is about assurance for long term - which is not all that bad after all. but before we ever reach the objectives in the long terms, we musnt 4get the short & mid term milestones too. have we heard enough assurances for the short & mid term goals, so to shape & materialize the long term??

from the looks of things, its been nothing but emphasis about long term goals, while life remains a turmoil for all the days from now till the long term objective is achieved.

And as someone pointed out, once they reach their long term goals, they will say that we need to suffer more short term pain. And they will go on again about tightening our belts and burning more fat, and grilling more muscles- all for the sake of the country.

Do it once, people might understand. Do it twice, people might think twice, but may still comply. But do it three times, do remember the boy who cried wolf.

 

[suteerak1099]

And as someone pointed out, once they reach their long term goals, they will say that we need to suffer more short term pain. And they will go on again about tightening our belts and burning more fat, and grilling more muscles- all for the sake of the country.

Do it once, people might understand. Do it twice, people might think twice, but may still comply. But do it three times, do remember the boy who cried wolf.

the things they do & impose on us have been nothing but superficial. many of which do not have sustainability. its good to have long term plans & visions, but before getting to point Z, there's need to go thru A, B, C... etc.

its no use telling us how heavenly Z will be like, when they fell short to figure out how to get from A to B to C... so on & so forth. the rate of acceleration is too fast, and shallow, the systems lack depth, been nothing but just touch & go. hence, in the long run, there's lack of sustainability, and the vacuum & constant need to find funds to ensure the operations snowball to become avalanche.

in hokkien we say: jia kin long pua wa (eat too fast, you break the rice bowl)

 

[The_Latest_H]

the things they do & impose on us have been nothing but superficial. many of which do not have sustainability. its good to have long term plans & visions, but before getting to point Z, there's need to go thru A, B, C... etc.

its no use telling us how heavenly Z will be like, when they fell short to figure out how to get from A to B to C... so on & so forth. the rate of acceleration is too fast, and shallow, the systems lack depth, been nothing but just touch & go. hence, in the long run, there's lack of sustainability, and the vacuum & constant need to find funds to ensure the operations snowball to become avalanche.

in hokkien we say: jia kin long pua wa (eat too fast, you break the rice bowl)

Its terrible when they ignore it really. And people must realise that. If not we are toasted not just long term, but short term as well.

 

[suteerak1099]

Its terrible when they ignore it really. And people must realise that. If not we are toasted not just long term, but short term as well.

look at the things they do, estate upgrading, hosting of community events, all with superficial & shallow agendas. even the recent sg day hosted in melbourne..... is that all they can do for the sporns?

all of which do not improve the quality of life for sporns. in short, just wayang to say that they did their part to interact with the ppl. bt wat really is needed is for them to be WITH the ppl - shoulder to shoulder.

 

[popdod]

More retrenchments,
More jobless,
More in debts,
More suicides,
More depressions.

Huat ahhhhhhhhhh!!!

:( :(

 

[halsey02]

Repeating what I have said many times in the old and new forums....

People must get used to the idea that recession is not a bad thing.

It is a good thing, really. I am not indulging in irony or sarcasm

Recession teaches people true values, not blind consumerism, bind people together through helping each other

"I Can feel it in by bones, no recession is not good for you" misquote "wooden", the uncle of Pino'

 

[silverspoon]

recession coming they still up the electricity charges...it is like they are hoping we can die faster....

i think they just want all singporean to die faster so they can replaced us with the all mightly FT forces

 

[Singapaporean]

More retrenchments,
More jobless,
More in debts,
More suicides,
More depressions.

Huat ahhhhhhhhhh!!!

:( :(

"Retrenchment is good for singapore. If there is no retrenchments, then I worry." - SM Goh

 

[SIFU]

shiny-head tharman confirmed recession..

maybe it is really global problem and out of PAP's hand..

but what about the recent public transport and electricity cost increase??

simply overpaid idiots!

 

[kuntakinte]

I remembered some moron also said that Singapore will have "More Good Years !!!"

The same moron also hails i-one.net as the "Internet Darling"

Home > Breaking News > Singapore > Story

http://www.straitstimes.com/Breaking+News/Singapore/Story/STIStory_286417.html

'So we'll ride through the down cycle ...I feel we're going to come through it better than most countries - not just in the region but even most developed countries.'


[email protected]

 

[BlueCat]

recession is everywhere in the glode except maybe those oil producing countries.

 

[Manchu]

The writings for recession already on the wall since the US financial crisis started late last year. The time lagging effect to Asian economies has average abt 6 mths from past trends.

Therefore everyone in Asia, including Singapore,will have to live through this recessionary period.

We don't need the highly paid, highly intelligent Singapore Ministers to suddenly wake up one morning to tell us that there is going to be a recession. For those more knowlegable, they saw it coming to Singapore already.

So after all the fun and fare of F1 formula race, transport price increases, taxi fare increases,ERP increases, government bonus increases.....its time for the Government to break the bad news ...that RECESSION has started n time to tighten our belts. HOW CONSIDERATE of them ?????

HAHAHA. Must be making fools of the 66% that voted for them.