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Official says Singapore may face major layoffs

Despite initial signs of a turnaround, Singapore's economy will continue to lag and there will be "major" layoffs in the coming months, the deputy prime minister warned.

"We think the Singapore economy will only pick up more strongly toward the end of this year," Deputy Prime Minister Lee Hsien Long was quoted as saying in The Straits Times yesterday.

Lee, the son of Singapore's founding father Lee Kuan-yew, is the country's deputy prime minister and finance minister.

Singapore would likely see rising unemployment and "major" layoffs in the financial sector in the coming months, he said.

Last week Prime Minister Goh Chok-tong boosted expectations for economic growth. He said the nation's gross domestic product would likely expand by 1 percent to 3 percent this year, compared with an earlier forecast ranging from a contraction of 2 percent to growth of 2 percent.

Singapore's revised forecast was premised on improving demand from the US and better consumer sentiment.

"Let us first concentrate on reviving the economy," Lee said.
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