Singapore's new government faces tough challenges

Lee Hsien Loong, the eldest son of Singapore's founding father Lee Kuan Yew, became the third prime minister of the island state Thursday, but his new government will have to face tough challenges as the recent years have witnessed dramatic political and economic changes both at home and abroad.

One of Lee's main tasks is to boost the country's trade-dependent economy, which will no longer have the good times it had enjoyed before the Asian financial crisis in 1997.

As an island state with a population of 4 million, Singapore has been regarded as a high-end manufacturing base, a hub for financial services and a center for a wide range of industries such as aviation and ports, but the country now faces threats to such positions due to the rapid development of globalism.

In addition, its small-scale economy is easily affected by outside factors such as the 1997 Asian financial crisis, Sept. 11 terror attacks, the SARS epidemic and global economic recession.

So far this year, Singapore has repeatedly revised its economic growth forecast from the previous range of 5.5-7.5 percent to 8-9 percent. But its economy will slow down to a range of 3-5 percent next year because of such uncertainties as high oil prices and possible interest rate hikes by the US Federal Reserves.

Therefore, Lee's new government must try in every possible way to sharpen the country's economic edge in a highly competitive world by deepening reforms of the economic structures, to create more new jobs to lower the 4.5 percent unemployment rate and to narrow the growing gap between the rich and poor.

Another challenge Prime Minister Lee has to face is how to strengthen the social cohesion and to fight against terrorism, which has in recent years been a major threat to Singapore's stability and economic development.

Singapore has seen fundamental changes since its independence in 1965. It now has fewer babies, more aged people and the younger generation has rising expectations for better jobs and more open society than their parents. So Lee and his team will have to live up to their hopes.

In recent years, Singapore has faced growing risk of terror attacks due to its pro-Western policy and its support to the US-led anti-terror coalition. As a small city state, any terror attack would cause an immeasurable loss to it.

To beef up security measures to deal with terrorism, the new prime minister has to continue its efforts to ensure his countrymen of different ethnic groups to live in harmony.

The third challenge is Singapore's relations with neighboring countries such as Malaysia and China.

As neighbors, Singapore and Malaysia share many common interests, but ties between them have been strained in recent years by a number of outstanding issues, including the pricing of water which Malaysia supplies Singapore and Malaysia's sovereignty claim over Pedra Branca, a tiny rock islet 19 nautical miles east of Singapore.

Malaysia has demanded a higher price for raw water sold to Singapore. Under the 1961 and 1962 agreements, Singapore pays three Malaysian cents (less than one US cent) for every 1,000 gallons of water from Malaysia.

The change of leaderships in both countries no doubt offers an opportunity for both sides to seek ways to remove the obstacles between them, but it is really not an easy job as the issues are directly related to their core interests.

Sino-Singapore relations have witnessed smooth development in recent years, especially in the field of economy. But Lee's so-called "private and unofficial" visit to Taiwan last month has soured such ties. It is a serious test for Lee to take concrete actions to mend its damaged relations with China, in the interest of both countries.

Source: Xinhua