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Goh ready to resign as economy booms

Bronze statues of business traders sit along a path near Singapore's financial district on Monday. Singapore's economy is likely to grow faster than initially forecast this year after surging 7.3 percent on an annual basis in the first quarter, the government said Monday. PHOTO: AFP

Singapore's leadership transition plans are proceeding smoothly with the city-state's booming economy setting the stage for Prime Minister Goh Chok Tong to stand down possibly before August, analysts said.

Goh, 62, has said publicly he would be comfortable handing over power to his designated successor, Deputy Prime Minister Lee Hsien Loong, once he was confident the economy had recovered from last year's downturn and capable of growing 3 to 4 percent this year.

He said a decision would be made after evaluating the city-state's economic performance in the first three months of the year.

Preliminary figures released on Monday by the trade and industry ministry showed the economy grew 7.3 percent on an annual basis in the March quarter, its fastest pace since the last quarter of 2000.

The ministry also said it will likely revise upwards its 3.5 to 5.5 percent next year growth targets in May when the full economic report card for the March quarter is unveiled.

Goh's office did not immediately reply reporters Tuesday on when the succession is likely to take place.

But analysts said the first quarter snapshot of the economy meant Goh was poised to make an announcement within months.

"The decision has already been made," political analyst Seah Chiang Nee said, who airs his commentaries on his own www.littlespeck.com Web site.

"They [government] have more or less anticipated the upturn. Maybe the pace has come as a bit of a pleasant shock to everybody," Seah said.

Song Seng Wun, regional economist at GK Goh brokerage, said an announcement could be on the cards before the May release of the full economic picture for the March quarter.

He said moves by the central bank, the Monetary Authority of Singapore (MAS), to also tighten monetary policy on Monday, showed officials were confident the economic momentum was sustainable.

"I don't think we need to wait for the second quarter figures [for an announcement]. The move by the MAS already confirms that the authority believes the economy is on a much surer footing than any time before," Song said.

"So these fulfil the necessary conditions set by Goh," Song said.

MPs from the ruling People's Action Party told the <> newspaper last week that Lee would likely be installed as prime minister ahead of Singapore's National Day in August.

The prime minister traditionally delivers an address to the nation at a National Day rally that attracts tens of thousands of people.

"The PM has indicated that he probably might be in the audience listening to the new PM at the next National Day," MP Charles Chong was quoted as saying in the newspaper.

"Besides, what better time than the National Day Rally for the new PM to address Singaporeans? That is when the PM gives his progress report, overview of world scenario and what he's going to do for the country," Chong was quoted as saying.

Goh took over the top political job in 1990 from Singapore's founding prime minister Lee Kuan Yew, who is the father of Lee Hsien Loong.

Analysts said they expected the transition of power this year to be very smooth with no major policy changes.

They pointed out that Lee, who is also finance minister and head of the central bank, has been the city-state's economic czar.

"He has announced many of the key initiatives in the last few years ... he has steered the economic policies with PM's Goh voice being less heard these days," Song said.
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