Singapore's Amazing Economy Under Lee Hsien Loong

However, it is in no way accurate to contrast Lee Hsien Loong's economy with Lee Kuan Yew's. The two performers mainly performed in distinct eras. Lee Kuan Yew oversaw a nation that was ready for development, whereas Lee Hsien Loong is in charge of a nation that is fully and already developed. Let's examine Singapore's macroeconomic performance under Lee Hsien Loong nonetheless.

The behavior of the economy as a whole, as measured by indices like the gross domestic product, inflation, unemployment rate, and a lengthy list of other indicators, can be split into and understood as the macroeconomy of a nation. However, these three are the most crucial and straightforward ways to comprehend how Singapore's economy has performed thus far since Lee Hsien Loong took office. According to data from the World Bank, Singapore's gross domestic product was approximately $166 billion USD in 2004 but increased to a staggering $360 billion USD by 2021. This means that since Lee Hsien Loong assumed power, Singapore's economy has grown by a factor of two. The extent to which he influenced Singapore's economy to grow at this rate is a contentious issue. On the one hand, the economy he inherited already had the groundwork set by his forebears. Both political and economic institutions were well-established. Enough to imply that the economy the government inherited already had the appropriate policies in place, negating the necessity for significant government intervention.But let's look at the odd government decisions and policies that Lee Hsien Loong made while serving as prime minister.

Before that, we must first look at Singapore's average annual rate of GDP growth throughout his leadership. According to World Bank data, from the time of his inauguration until 2021, Singapore's economy grew by an average of only 4%, which is less than Lee Kuan Yew's average GDP growth rate of 8% between 1965 and 1990. However, as we already mentioned, it is crucial to remember that Lee Hsien Loong has been in charge of a developed nation, whereas the latter is a developing nation. A notable example is the OECD, a club of 38 large, developed nations, some of which have done reasonably well. In comparison to Lee Hsien Loong's success, the OECD only averaged 1.8 percent every year from 2000 to 2020, according to data from the World Bank. Do keep in mind, nevertheless, that several OECD nations have higher than this.

On the other hand, unemployment is still another important metric. Regulations on the labor market, monetary and fiscal policies, and other factors frequently have an impact on the unemployment rate. The unemployment rate for 2021 was 3.6 percent, although from 2004 and 2021, it fluctuated between 3.1 percent and 5.9 percent. Its poor performance in several years was caused in part by the global financial crisis of 2008. However, given that the OECD average is at 5.6 percent, a current unemployment rate of 3.6 percent can also be viewed as a positive number. Throughout the nearly two decades Lee was in power, his government's policies changed. He has pushed for the development of jobs in a number of industries, advocated for the digitalization of a number of sectors, and underlined the need for upskilling, which is an important aspect that will decide how work will be done in Singapore in the future.

Similar to unemployment, inflation is a problem where the government can play a significant role owing to monetary policies. One of the main factors in Lee Kuan Yew's success throughout the decades he led Singapore was inflation. He controlled inflation at a low level while growing the economy at an astounding rate. However, Lee Hsien Loong likewise didn't experience much inflation. Inflation was either less than 1% or even negative from 2015 to 2019.However, during the global financial crisis of 2007 to 2009, inflation was substantial. But even Lee Hsien Loong has warned that the island nation faces dangers in 2023 given the current inflation tendencies. He and his team had announced a number of assistance programs to help needy Singaporeans. Prior to 2020, inflation was just slightly over normal, so it might be said that inflation will be his next major obstacle.

We can list some of Lee Hsien Loong's economic and social programs in addition to the macroeconomics of Singapore under his leadership. Since 2004, Singapore has been governed by Lee Hsien Loong, who has introduced many initiatives. He put into effect a rule known as the "five-day work week" on August 22, 2004, eliminating the Saturday half-day. Additionally, maternity leave was extended from 8 to 12 weeks. Additionally, a baby bonus program was expanded to promote birth rates. Hsien Loong distributed budget surpluses as part of a 2.6 billion Singaporean dollar Progress Package that was unveiled in February 2006. But his actions throughout the Great Recession reveal his most crucial agenda. Unexpectedly, the GDP increased by 1.9 and 0.1 percent in 2008 and 2009, respectively. Hsien Loong and his administration announced billion-dollar stimulus measures over the course of the Great Recession, including 2.8 billion Singaporean dollars in November 2008 and an additional 20.5 billion dollars by January 2009. By August 2009, Lee had declared that Singapore had recovered and that things had stabilized. As a result, Singapore's GDP grew by an enormous 14.5 percent in 2010, setting a record.

His "Singaporean First" policy, which defined many steps in housing, education, healthcare, and employment to relieve residents from the stresses of the influx of immigrants, was one of the most well-known initiatives during his administration. In addition, he was the driving force behind many successful foreign policies toward significant allies including China, the United States, and Malaysia. In China, Lee Hsien Loong had witnessed the passage of the China-Singapore Free Trade Agreement in 2009 as well as considerable cooperation through government-to-government projects. Since then, trade with China has been expanding quickly. SingStat data reveals that the total merchandise trade increased from 2.3 billion dollars in December 2004 to 6.3 billion Singaporean dollars in December 2022.These also experienced a significant surge from Malaysia and the United States. In part because of the free trade agreement, but also because trading between nations has become increasingly inevitable as the world's economies continue to expand. However, Lee Hsien Loong did not always receive praise for the economy. His administration over the years also experienced difficulties, which weren't just related to the economy.

Legal actions, accusations, and even a defamation case against him personally were a few of the events that occurred. However, there were also some important measures on Singapore's overall agenda that some have criticized for being sloppy under his administration. For instance, a wealth tax was once increased in Singapore in 2021. One of the few problems Singapore still had was inequality, and the government is working to close this gap. However, according to Prime Minister Lee, it was not simple to put into practice. However, based on his appearance with the Bloomberg New Economy Forum, he appears to support a wealth tax as a means of addressing the inequality problems. He noted in an interview with the South China Morning Post that "the city must welcome foreign talent to realize its goal in becoming a technology center and to become a regional powerhouse. " international talent is one important tool he continues to pursue.

In conclusion, Lee Hsien Loong's leadership can be viewed as having grown rather adequately. However, one cannot say that his economy was a failure because Singapore was already a developed nation with a high GDP per capita when he took office. In other words, since production was already expanding at a high rate, future growth would require quick technological advancement. But based on what we have observed, economic growth has continued at a pace that has contributed to the expansion of the economy as a whole. However, these are only a few picky signs, and they may or may not even determine if his leadership was truly good or bad.