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03 December 2012

3rd December, Monday




Govt aiming for growth of 2-3% a year: PM Lee

Source: Business Times

The government is no longer aiming for "ridiculously high" economic growth of years past, but rather a more sustainable rate of about 2-3 per cent per year.

Such a rate, said Prime Minister Lee Hsien Loong, "will be considered good" as the Singapore workforce will expand much slower in the coming years due to a tightening of the inflow of foreign workers.

"Do we need growth? Yes we do, because we want to generate resources, we want to improve lives and build a liveable city," said Mr Lee to an audience of over a thousand cadres gathered at the Kallang Theatre.

Mr Lee noted that the Ministry of Trade and Industry's latest estimate for GDP growth for 2012 was "about 1.5 per cent". This was at the lower end of its previous 1.5-2.5 per cent forecast.

"Are we happy because it is low? I don't think so. Workers, businesses, all of them are concerned about the outlook. What does slower growth mean? Smaller increments, smaller bonuses, fewer jobs created. It becomes harder to do business," he noted.

A sustained period of low or zero growth would invariably affect Singapore's vibrancy, its business sector and its own confidence, he said.

Those likely to be hit the hardest would be the low-wage workers, because this group was "already in a tough spot" and would find it difficult to move up the ladder.

Young people, too, would be affected because they typically want "opportunities, adventure and challenges", said Mr Lee.

The prime minister empathised with the concerns faced by small and medium-sized enterprises because some were already suffering from the restrictions on hiring foreign workers and the overall higher costs of doing business. He promised that the government would do all it could to help those companies in need, be it through restructuring programmes or projects to boost their productivity.

And just as economic growth was central to the PAP's fundamental overall goals, so too was the importance of having a meritocratic system in Singapore, said Mr Lee.

"I worry when people say that meritocracy is wrong," said Mr Lee, adding that it was not possible to replace meritocracy with a system based on wealth, personal connections or even race.

"If we do not recognise merit, how do people from poor backgrounds rise, improve their lives, and contribute fully to Singapore? Nobody will ever discover them," he pointed out.

While he shared that Singaporeans of all backgrounds and abilities would be given a fair chance to do well in life, Mr Lee also called on the successful ones to feel a duty to contribute back to society such that everyone benefits from the system.


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Developers rolling out fresh projects as year ends

Source: The Straits Times

The property market usually puts its feet up as Christmas and New Year approach, but this year looks to be an exception with a string of new launches planned.

Forget the school holidays and festive wind-down; developers are keen to push out their projects while the housing market is still healthy. They have prepared landed and non-landed projects with thousands of units slated for release.

Launches that could be pushed out by the year end, market conditions willing, include The Whitley Residences in Whitley Road, Liberte in Sarkies Road, Kingsford @ Hillview Peak, Village @ Pasir Panjang, Echelon near Redhill MRT station, Michaels' Residences in Chestnut Avenue, Trilinq in Clementi and Spottiswoode Suites in Spottiswoode Park Road.

At least three other executive condominium projects - CityLife @ Tampines, Forestville in Woodlands and The Topiary in Sengkang - are also expected this month alone.

But some developers have chosen to delay their launches until next year.

Tuan Sing Holdings' Sennett Residence in Potong Pasir will be released next month, although marketing agents are already collecting interest. Sennett Residence will have 338 units comprising one- to five-bedders and penthouses. It will also have three 18-storey towers and a five-storey block with an Olympic-size pool at the top.

Experts note that developers are keen to ride on the wave of robust new home sales this year.

Mr Lee Sze Teck, senior manager of training, research and consultancy at Dennis Wee Group, said: "Buying sentiment is still good and we are headed towards a record year of sales, so developers are keen to continue building on that momentum." Low interest rates are also supporting the market, he added.

Another analyst said prices at new launches are likely to plateau in the short term given the October cooling measures. "But if you look at how land prices have been moving over the past few months, it looks like there could be further price upside for certain launches that take place in the second or third quarter next year after this period of stabilisation," he added.


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Office rental market 'to hit bottom this quarter'

Source: The Straits Times

The office rental market is expected to hit bottom this quarter before a moderate rebound in the next few years, according to a real estate firm.

It said average monthly rents in the Central Business District (CBD) area - comprising Marina Bay, Raffles Place and Shenton Way - are at $9 per sq ft, 1.6 per cent down from the third quarter.

The firm expects only a moderate supply to hit the market next year, leading to lower vacancy rates and firmer prices. Office leasing activity is also expected to remain strong, with more demand coming from a more diversified range of businesses.

The firm's report outlines how tenants from legal services, e-commerce, professional services and energy industries are expected to take up significantly more leases next year as demand from the financial sector wanes.

Additional demand is expected to come from displaced tenants of older office buildings that have been slated for redevelopment, such as The Corporate Office building and Cecil Court in Shenton Way.

While this demand, coupled with low vacancy rates, is expected to support rents next year, the firm remains cautiously optimistic about a recovery. It said demand is not yet strong enough to support a sharp rental rebound and any sign of a meaningful recovery in rents may emerge only in the second half of 2014.


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