Information about Asia and the Pacific Asia y el Pacífico
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Singapore

Author(s):
International Monetary Fund
Published Date:
October 2001
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Information about Asia and the Pacific Asia y el Pacífico
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I. Overview

1. The recent cyclical peak in 2000 fueled by the strong global electronics demand, followed by the sharp slowing of the economy precipitated by the downturn in the electronics cycle and significant weakness in the US economy, highlights the importance of external demand in the business cycle of Singapore’s economy. Because of the small size of Singapore’s domestic market, external factors will undoubtedly remain a key determinant of its economic outlook. In a volatile external environment, an important challenge for Singapore has been to sustain strong long-term growth and dampen cyclical fluctuations.

2. Well aware of these challenges, Singapore has embarked on an ambitious program of structural reforms in the last two decades aimed, to a large extent, at diversifying the manufacturing base and moving it up the value added chain, and liberalizing and strengthening the financial sector. This paper examines the structural change in Singapore’s manufacturing industry during 1980–99, analyzes the key recent developments and reforms of Singapore’s financial sector, and traces the evolution of the policy on noninternationalization of the Singapore dollar.

3. Chapter II examines the extent to which the structure of the manufacturing sector has changed in Singapore over the period 1980–99. In particular, the focus is on two questions: did the manufacturing sector move up the value added chain and has the manufacturing base became more diversified during the period 1980–99? The analysis strongly supports the view that the Singaporean manufacturing sector has continued its fast pace transformation from low/medium value added sectors to high tech and high value added sectors during the last two decades. The continuous upward shift along the value added chain in the manufacturing sector coupled with the diversification effort has contributed to both enhancing long term-growth and significantly reducing cyclical fluctuations in real output.

4. Chapter III provides an update on the reforms implemented over the past year and outlines the remaining tasks and priorities. In early 1998, the Singapore authorities unveiled a program of comprehensive reforms aimed at positioning Singapore at the forefront of financial sector innovations in a global economic environment. The overarching objective of the reforms were to overcome the disadvantage of the small size of the domestic market in Singapore and to compensate for the lack of a natural hinterland unlike other Asian financial centers such as Hong Kong and Tokyo. The strategy involved an active role for the government in promoting the industry, including through tax and other incentives, and reforms of the regulatory environment in a manner that maintained a robust financial system while at the same time encouraging innovation. As a result, the financial sector landscape has now come close to the vision set out in early 1998. The institutional environment is already at par with the international best practice in most areas, and continues to be reviewed and upgraded. Activity has also picked up sharply in a number of segments including the bond market and asset management. Challenges ahead are continued growth in the capital market and improved efficiency and international competitiveness in the banking sector, while completing the transformation of the supervisory framework to a more progressive risk-based regime.

5. Chapter IV traces the evolution of the policy on noninternalization of the Singapore dollar since the 1980s and assesses its effect on Singapore’s integration with the international financial market. Singapore has long maintained several restrictions against the international use of its currency, generally referred to as the policy of “not encouraging the internationalization of the Singapore dollar.” The policy has been liberalized in stages since the late 1990s, and the most recent and significant liberalization was announced in December 2000. Even before the recent liberalization, the policy posed few impediments to international trade and capital flows, for the policy was intended not to inhibit free flow of bona fide capital but to limit speculative activities in Singapore’s financial markets. The non-internationalization policy needs to be appraised from the perspective of overall macroeconomic policy framework of Singapore as it is difficult to disentangle the effects of the measures on insulating Singapore from speculative attacks from the overall macroeconomic policy track record. The noninternationalization policy clearly has had a strong signaling effect in deterring potential speculative activity against the S$. However, without the strong and credible policy record, the noninternationalization policy is not likely to have been defensible for over two decades under the highly open regime for capital and financial accounts.

II. Structural Change In Singapore’s Manufacturing Industry During 1980–991

A. Introduction

1. This chapter will examine the extent to which the structure of the manufacturing sector has changed in Singapore over the period 1980–99. In particular, the focus will be on two questions: did the manufacturing sector move up the value added chain and has the manufacturing base became more diversified during the period 1980–99? The study uses annual census data for 4,007 establishments regrouped in 77 sub-sectors (corresponding to the 5-digit elements of the Singapore Standard Industrial Classification). The 77 sub-sectors will be further aggregated into 23 sectors. The data include the number of workers, output, value added, direct exports, and fixed assets. All value data are in nominal terms.2

2. The chapter is divided into nine sections. Section B covers labor reallocation across sectors. Sections C to G cover the evolution of: (i) sectoral shares in manufacturing value added; (ii) value added content; (iii) relative productivity; (iv) relative capital-labor ratio; and (v) export shares and degree of openness. Section H presents a few empirical results, and Section I concludes.

B. Labor Reallocation Across Sectors

3. Table II.1 shows the sectoral shares in manufacturing employment and their corresponding ranking among the 23 sectors in 1980 and 1999. In addition, the table shows the following statistics for the whole period: the mean, the standard deviation normalized by the mean share during 1980–99, and the minimum and maximum.

Table II.1.Sectoral Shares in Manufacturing Employment, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco0.04980.045100.0440.1060.0380.051
217Textiles & Textile Manufactures0.031140.005220.0130.6840.0050.031
318Wearing Apparal Except Footwear0.09820.024130.0720.4270.0220.104
419Leather, Leather Products & Footwear0.010200.003230.0060.4790.0030.010
520Wood & Wood Products Except Furniture0.036130.005200.0140.8070.0040.036
621Paper & Paper Products0.015180.014160.0140.0760.0130.016
722Publishing, Printing & Reproduction of Recorded Media0.042100.05180.0490.0720.0420.054
823Refined Petroleum Product0.012190.009180.0110.1450.0090.013
924Chemicals and Chemical Products0.022150.04690.0310.2200.0220.046
102420Manufacture of Pharmaceutical and Bio-Pharm. products0.004220.005190.0050.0810.0040.006
1125Rubber & Plastic Product0.042110.05970.0470.1670.0380.059
1226Non-Metallic Mineral Products0.016170.018150.0200.2560.0150.030
1327Basic Metals0.008210.005210.0070.1640.0050.008
1428Fabricated Metal Products Except Machinery $ Equipment0.05860.11230.0770.2100.0580.112
1529Machinery & Equipment0.08040.10740.0920.0890.0800.107
1630Electric Machinery & Apparatus0.04390.032110.0450.1020.0320.052
1731Electronic Products & Components0.25010.31210.3010.1470.2190.349
183111Manufacture of Semiconductor devices0.06650.07160.0530.1750.0410.071
193120Manufacture of communications equipment0.003230.013170.0140.5980.0030.028
203141/9/90Manufacture of Computing and Data Processing Equipment0.018160.13520.0940.5160.0180.160
2132Medical, Precision & Optical Instruments, Watches & Clocks0.037120.025120.0250.1820.0200.037
2233Transport Equipment0.09730.10350.0910.1490.0630.112
2334Other Manufacturing Industries0.05370.024140.0430.2910.0240.057
Sources: Data provided by the Singapore authorities; and staff estimates.
Sources: Data provided by the Singapore authorities; and staff estimates.

4. While electronics was already the most important manufacturing sector in Singapore in 1980 in terms of employment share (25 percent), this sector has fundamentally changed during the last two decades. In 1980, semiconductors were the dominant employer within the electronics sector with 6½ percent of total manufacturing employment, while communication equipment was insignificant (with ¼ percent of manufacturing employment) and computing and data processing equipment was still in its infancy with 1¾ percent of manufacturing employment. In 1999, electronics strengthened its top position to 31 percent of manufacturing employment. Thus, roughly one-third of the manufacturing employment is in the electronics sector. Furthermore, the structure of the electronics sector has significantly changed. While the share of semiconductors has increased slightly from 6½ percent to 7 percent, communications equipment increased its share from ¼ percent to 1¼ percent, and more importantly, computing and data processing moved from 1¾ percent to 13½ percent of manufacturing employment becoming the most important sub-sector in electronics, dominating every other two-digit sector.

5. Interestingly, wearing apparel was the second largest sector with 10 percent of manufacturing employment and textiles represented 3 percent. These traditional sectors have weakened considerably during the last two decades and represented only 2½ percent and ½ percent of manufacturing employment, respectively. Chemicals only represented 2¼ percent of manufacturing employment in 1980 and was ranked 15th among the 23 manufacturing sectors. Its share in manufacturing employment more than doubled during 1980–99 (4½ percent in 1999) and is ranked ninth in 1999. The relative size of wood and wood products also declined significantly (from 3½ percent in 1980 to ½ percent in 1999).

6. In view of the size of the increase in their labor shares, it is not surprising that communication equipment and computing and data processing are among the sectors with the highest volatility, as measured by their normalized standard deviation, indicative of the fundamental transformation occurring in these sectors. The other sectors with high normalized standard deviations are the declining sectors: wood and wood products, textiles, refined petroleum products, and wearing apparels.

C. Evolution of Sectoral Shares in Manufacturing Value Added

7. The previous section shows that there have been important shifts in labor across manufacturing sectors. Is there a pattern in this labor reallocation process and, in particular, is there evidence of reallocation of labor toward higher productivity sectors? There is indeed strong evidence in the data showing a rapid upgrading of the Singaporean manufacturing sectors toward higher value added sectors as shown by the sectoral shares in manufacturing value added in Table II.2.

Table II.2.Sectoral Shares in Manufacturing Value Added, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco0.03980.025130.0400.2100.0250.053
217Textiles & Textile Manufactures0.017200.002210.0070.6900.0020.017
318Wearing Apparal Except Footwear0.032110.005190.0230.5220.0050.036
419Leather, Leather Products & Footwear0.004220.001230.0020.4450.0010.004
520Wood & Wood Products Except Furniture0.019190.002220.0070.8620.0020.019
621Paper & Paper Products0.010210.009170.0140.2060.0090.018
722Publishing, Printing & Reproduction of Recorded Media0.032100.038100.0440.1430.0320.052
823Refined Petroleum Product0.18120.04490.0900.5720.0440.182
924Chemicals and Chemical Products0.04470.17530.0940.3660.0430.175
102420Manufacture of Pharmaceutical and Bio-Pharm. products0.020170.12640.0490.4930.0200.126
1125Rubber & Plastic Product0.025130.024140.0260.1010.0220.031
1226Non-Metallic Mineral Products0.021150.014160.0230.3510.0110.043
1327Basic Metals0.019180.004200.0100.4370.0040.019
1428Fabricated Metal Products Except Machinery $ Equipment0.04460.05180.0560.1220.0440.066
1529Machinery & Equipment0.09440.05370.0800.2930.0530.130
1630Electric Machinery & Apparatus0.03390.019150.0310.1400.0190.037
1731Electronic Products & Components0.20610.43610.3260.3010.1630.449
183111Manufacture of Semiconductor devices0.08350.10150.0600.3870.0330.104
193120Manufacture of communications equipment0.003230.031110.0180.6690.0020.040
203141/9/90Manufacture of Computing and Data Processing Equipment0.024140.24420.1460.5830.0230.267
2132Medical, Precision & Optical Instruments, Watches & Clocks0.021160.031120.0210.2220.0120.031
2233Transport Equipment0.13230.05960.0880.2740.0590.132
2334Other Manufacturing Industries0.028120.007180.0200.3870.0070.030
Sources: Data provided by the Singapore authorities; and staff estimates.
Sources: Data provided by the Singapore authorities; and staff estimates.

8. First, electronics more than doubled their share in manufacturing value added during 1980–99, starting with 20½ percent and ending with 43½ percent. This gain in value added share is much larger than the gain in the employment share (which only increased from 25 percent to 31 percent during the same period) corroborating the view that the economy has shifted toward higher value added sectors. Another important fact pointing in the same direction is that electronics produced 43½ percent of manufacturing value added with only 31 percent of manufacturing employment in 1999. Consistent with the labor reallocation analysis in the previous section, communication equipment and, especially, computing and data processing equipment account for the bulk of the increase in electronics share in manufacturing value added. The former increased its share from ¼ percent to 3 percent, while the later increased its share from 2½ percent to 24½ percent, becoming the dominant sector in manufacturing.

9. Second, chemicals and chemical products became the second most important manufacturing sector which produced 17½ percent of manufacturing value added with only 4½ percent of manufacturing employment in 1999. In this sector, pharmaceutical and bio-pharmaceutical products alone accounted for 12½ percent of manufacturing value added with merely ½ percent of manufacturing employment in 1999. Thus, electronics and chemicals accounted for more than 60 percent of manufacturing value added and 35 percent of manufacturing employment in 1999, versus 25 percent of manufacturing value added and 27 percent of employment in 1980.

10. Third, the relative importance of the more traditional sectors with low value added content such as textiles, wearing apparels, and wood and wood products declined substantially. All three sectors accounted for less than 1 percent of manufacturing value added in 1999 while they represented more than 5 percent in 1980.

11. An exception to this transformation of the economy toward higher value added sectors is the important contraction of refined petroleum which accounted for 18 percent of manufacturing value added and 1¼ percent of manufacturing employment in 1980, but only 4½ percent of value added and about 1 percent of employment in 1999. However, the decline in the relative importance of this sector is consistent with Singapore’s strategy to move progressively away from sectors that are intensive in physical capital—indeed, this sector is highly intensive in physical capital as discussed in Section F—and move toward a knowledge-based economy where human capital plays a crucial role.

12. Sectors that are in the middle of the value added chain, such as non-metallic mineral products, basic metals, machinery and equipment, electric machinery, and transport equipment all lost in terms of value added share but less than the low value added sectors.

D. Evolution of Value Added Content

13. Value added content is defined as the ratio of value added divided by output. Table II.3 shows the change in value added content from 1980–99 for the 23 sectors. The value added content has been generally quite low, reflecting the high dependence of the manufacturing sector on material inputs, of which a large share is imported. For the whole manufacturing sector, value added accounts for only 22 percent in 1980 and 26 percent in 1999. The sector with consistently the highest value added content has been pharmaceutical and bio-pharmaceutical products. Its value added content was 49 percent in 1980 and has increased substantially to achieve a remarkable 90 percent in 1999. Electronics had a small value added content in 1980 (27 percent) which declined even further to account for only 22 percent of output in 1999, reflecting the large share of imported components in the sector’s output. This is particularly true for the computing and data processing equipment whose value added content declined from 44 percent to 21 percent. However, fitting an exponential trend trough the whole sample (including all sectors) for the periods 1980–89 and 1990–99 shows that value added content declined somewhat for during 1980–89 but increased during 1990–99.

Table II.3.Share of Value Added in Output, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco0.132220.260150.2000.2270.1320.260
217Textiles & Textile Manufactures0.257130.293100.2470.0650.2260.293
318Wearing Apparal Except Footwear0.252150.237180.2420.0820.2170.281
419Leather, Leather Products & Footwear0.250180.216210.2470.1050.2080.293
520Wood & Wood Products Except Furniture0.174210.221200.1910.1290.1510.236
621Paper & Paper Products0.240190.39450.3280.1780.2110.406
722Publishing, Printing & Reproduction of Recorded Media0.40540.49520.4360.0970.3800.513
823Refined Petroleum Product0.108230.113230.1020.2550.0500.134
924Chemicals and Chemical Products0.31870.44130.3510.1250.2350.441
102420Manufacture of Pharmaceutical and Bio-Pharm. products0.48710.89610.7190.1840.4870.896
1125Rubber & Plastic Product0.274110.31670.2890.0770.2520.326
1226Non-Metallic Mineral Products0.219200.291110.2370.1050.1970.291
1327Basic Metals0.256140.273140.2260.1600.1590.307
1428Fabricated Metal Products Except Machinery $ Equipment0.251170.276130.2660.0460.2480.290
1529Machinery & Equipment0.34960.30280.3040.1000.2610.363
1630Electric Machinery & Apparatus0.31680.279120.2870.0820.2490.340
1731Electronic Products & Components0.268120.222190.2230.1010.1930.268
183111Manufacture of Semiconductor devices0.276100.245170.2000.1900.1530.276
193120Manufacture of communications equipment0.30590.30190.3020.2480.2010.480
203141/9/90Manufacture of Computing and Data Processing Equipment0.44420.208220.2620.3240.1760.444
2132Medical, Precision & Optical Instruments, Watches & Clocks0.36550.43540.4000.1390.2960.521
2233Transport Equipment0.44030.35960.3850.1240.3270.468
2334Other Manufacturing Industries0.252160.248160.2250.1010.1750.252
24Total manufacturing0.2180.2610.2280.0830.1950.261
Sources: Data provided by the Singapore authorities; and staff estimates.
Sources: Data provided by the Singapore authorities; and staff estimates.

E. Evolution of Relative Labor Productivity

14. The analysis of productivity across time is somewhat limited by the fact that all data are in current prices. Consequently, the traditional measure of productivity—value added in constant prices divided by the number of hours worked or employment—cannot be used here. However, it is possible to circumvent this problem by working with an index of relative productivity (which is unit free and therefore does not require constant price valuations), defined as value added per worker in current prices for a given sector divided by the same ratio for the whole manufacturing sector. A value less than one implies that labor productivity in the given sector is smaller than the labor productivity for the whole manufacturing sector. The opposite holds for a value larger than one. A value of one indicates that the sector is representative of the whole manufacturing sector.

15. This measure of productivity is presented in Table II.4. In 1980, the sector with the highest relative labor productivity3 was refined petroleum products with more than 15 times the productivity of the whole manufacturing sector. Interestingly, pharmaceuticals and bio-pharmaceuticals was second with 4½ times the average productivity. Note that electronics was below average, even though two of its components, semiconductors and computing and data processing equipment, were above average. As expected, the traditional sectors, including textiles, wearing apparels, leather, wood, and paper have the lowest relative labor productivity.

Table II.4.Relative Labor Productivity, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco0.810120.561150.8970.1490.5611.066
217Textiles & Textile Manufactures0.546190.435180.5210.1150.4090.642
318Wearing Apparal Except Footwear0.325230.226230.3000.1730.2060.379
419Leather, Leather Products & Footwear0.376220.379200.3740.1340.2840.468
520Wood & Wood Products Except Furniture0.522200.341210.4900.1100.3410.584
621Paper & Paper Products0.661160.670120.9830.2540.5411.342
722Publishing, Printing & Reproduction of Recorded Media0.767130.745110.8910.1040.7451.059
823Refined Petroleum Product15.57014.74827.9630.4873.95115.570
924Chemicals and Chemical Products1.96343.76733.0120.2911.9095.199
102420Manufacture of Pharmaceutical and Bio-Pharm. products4.509223.22419.8850.4704.18223.224
1125Rubber & Plastic Product0.604170.404190.5710.1180.4040.658
1226Non-Metallic Mineral Products1.29860.786101.1470.2340.6731.506
1327Basic Metals2.41330.93991.4600.3210.7842.413
1428Fabricated Metal Products Excepet Machinery $ Equipment0.762140.455170.7380.1580.4550.950
1529Machinery & Equipment1.16690.491160.8690.2860.4911.348
1630Electric Machinery & Apparatus0.759150.589130.6940.0850.5890.795
1731Electronic Products & Components0.826101.39771.0640.1980.7091.397
183111Manufacture of Semiconductor devices1.25581.41461.1140.3040.7232.062
193120Manufacture of communications equipment0.825112.43841.2520.5120.5562.547
203141/9/90Manufacture of Computing and Data Processing Equipment1.29771.81351.4770.1991.0512.006
2132Medical, Precision & Optical Instruments, Watches & Clocks0.555181.21280.8310.2240.5551.212
2233Transport Equipment1.35750.572140.9880.2790.5721.357
2334Other Manufacturing Industries0.514210.304220.4460.1420.3040.560
Sources: Data provided by the Singapore authorities; and staff estimates.Note: The index of labor productivity index is computed as the share of a sector in manufacturing value added divided by its share in manufacturing employment.
Sources: Data provided by the Singapore authorities; and staff estimates.Note: The index of labor productivity index is computed as the share of a sector in manufacturing value added divided by its share in manufacturing employment.

16. The main changes in 1999 are: (i) pharmaceuticals and bio-pharmaceuticals, with a more than a fivefold increase in relative productivity, displaced refined petroleum products for the first place, bringing the chemicals cluster as whole to the second position after refined petroleum products; (ii) relative productivity in electronics increased by about 70 percent and is significantly higher than the manufacturing average (while it was significantly lower in 1980) with gains in all sub-sectors, particularly in communication equipments where relative productivity increased threefold; (iii) the significant gains in relative productivity for chemicals and electronics implies that the relative productivity of the other sectors has declined, including the traditional labor-intensive sectors but also the metal-based industries, machinery equipment, electric machinery and transport equipment; (iv) finally, pharmaceuticals and bio-pharmaceuticals are on a steep upward trend as the maximum relative productivity over 1980–99 occurred in 1999 and the minimum was recorded in the beginning of the period, while refined petroleum products, though with still relatively high labor productivity, followed the opposite path.

F. Evolution of Relative Capital-Labor Ratio

17. The usual capital-labor ratio cannot be used here because of the lack of constant prices. However, as in the case of productivity, we can define a relative capital-labor ratio as the sector’s capital-labor ratio normalized by the capital-labor ratio for the whole manufacturing sector. The capital stock is measured by gross fixed assets and labor by the number of workers. Table II.5 shows that refined petroleum has had, by far, the highest capital-labor ratio with more than 18 times capital per worker than the average for the whole manufacturing sector. In 1999, chemicals had the second highest capital-labor ratio (more than four times the manufacturing average). Electronics was labor intensive in 1980 but capital per worker has increased 2½ times faster than the manufacturing average during 1980–99. In particular, semiconductors was labor intensive in 1980 with 50 percent less capital per worker than the manufacturing average, but had close to 2½ times more capital per worker than the manufacturing average in 1999. Note that communication equipments and computing and data processing are much less capital intensive than semiconductors with about 50 percent the capital-labor ratio of the whole manufacturing sector. However, these sectors are likely to be intensive in human capital which is not measured here.

Table II.5.Relative Capital-Labor Ratio, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco1.16360.88491.2160.1140.8841.445
217Textiles & Textile Manufactures0.96790.497180.7200.1650.4970.967
318Wearing Apparal Except Footwear0.190230.168230.1820.1290.1510.229
419Leather, Leather Products & Footwear0.417190.286220.3370.1790.2480.430
520Wood & Wood Products Except Furniture0.836110.383210.7490.2280.3830.957
621Paper & Paper Products0.763120.90681.1410.1570.7631.411
722Publishing, Printing & Reproduction of Recorded Media0.569160.631110.6370.0790.5530.714
823Refined Petroleum Product25.442113.719118.4300.18013.71925.442
924Chemicals and Chemical Products1.68944.23323.4380.2981.6894.409
102420Manufacture of Pharmaceutical and Bio-Pharm. products2.17022.75832.6600.1531.8403.642
1125Rubber & Plastic Product0.699130.509160.6600.1220.5090.807
1226Non-Metallic Mineral Products1.54551.21661.3910.0981.1861.617
1327Basic Metals1.97231.58851.9660.1331.4382.275
1428Fabricated Metal Products Excepet Machinery $ Equipment0.937100.519140.7850.1560.5190.944
1529Machinery & Equipment1.04480.566130.8760.1610.5661.044
1630Electric Machinery & Apparatus0.627150.768100.6970.0920.6040.791
1731Electronic Products & Components0.393220.98570.6200.2930.3930.985
183111Manufacture of Semiconductor devices0.498172.35541.2690.4860.4982.355
193120Manufacture of communications equipment0.403210.513150.4780.2650.1950.801
203141/9/90Manufacture of Computing and Data Processing Equipment0.410200.501170.4350.1570.3000.585
2132Medical, Precision & Optical Instruments, Watches & Clocks0.666140.614120.6560.0960.5620.760
2233Transport Equipment1.14070.456190.9040.2610.4561.190
2334Other Manufacturing Industries0.425180.390200.4500.1290.3670.593
Sources: Data provided by the Singapore authorities; and staff estimates.Note: The index of capital/labor ratio is computed as the share of a sector in manufacturing capital stock divided by its share in manufacturing employment.
Sources: Data provided by the Singapore authorities; and staff estimates.Note: The index of capital/labor ratio is computed as the share of a sector in manufacturing capital stock divided by its share in manufacturing employment.

G. Evolution of Export Shares and Degree of Openness

18. Table II.6, which shows sectoral shares in manufacturing exports, confirms the important transformation of the Singaporean economy during the last two decades. High-tech electronics and chemicals exports have gradually replaced exports of refined petroleum products and exports of traditional low value added sectors, such as food, wearing apparels, wood and wood products, and textiles. The share of electronics exports have increased from 23¾ percent in 1980 to 62¼ percent in 1999 while the chemicals share increased from 2¾ percent in 1980 to 13 percent in 1999. These share increases were to the detriment of refined petroleum, which moved from 40 percent of manufacturing exports in 1980 to 4 percent in 1999, and to the detriment of food, wearing apparels, wood and wood products, and textiles for which the combined share declined from 11¼ percent in 1980 to 2½ percent in 1999. Perhaps the most remarkable transformation is that of computing and data processing equipment, which increased its share of manufacturing exports from 1¾ percent in 1980 to 40 percent in 1999.

Table II.6.Sectoral Shares in Manufacturing Exports, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco0.04960.016120.0370.3730.0160.063
217Textiles & Textile Manufactures0.011160.001220.0040.7640.0010.011
318Wearing Apparal Except Footwear0.03270.008150.0250.4460.0080.043
419Leather, Leather Products & Footwear0.002230.001200.0010.4200.0010.002
520Wood & Wood Products Except Furniture0.02190.001230.0060.9970.0010.021
621Paper & Paper Products0.002220.004180.0050.3410.0020.008
722Publishing, Printing & Reproduction of Recorded Media0.005200.008160.0080.2530.0050.011
823Refined Petroleum Product0.39710.04370.1870.8040.0290.430
924Chemicals and Chemical Products0.02880.13130.0670.3960.0250.131
102420Manufacture of Pharmaceutical and Bio-Pharm. products0.013150.06850.0240.4910.0120.068
1125Rubber & Plastic Product0.009180.010140.0080.1190.0070.010
1226Non-Metallic Mineral Products0.007190.004170.0050.5080.0020.010
1327Basic Metals0.011170.001210.0050.5440.0010.011
1428Fabricated Metal Products Excepet Machinery $ Equipment0.016140.023110.0200.1850.0160.027
1529Machinery & Equipment0.06640.04460.0610.2210.0440.089
1630Electric Machinery & Apparatus0.020100.015130.0220.1400.0150.027
1731Electronic Products & Components0.23720.62210.4620.3590.2090.654
183111Manufacture of Semiconductor devices0.09530.11640.0880.1380.0650.116
193120Manufacture of communications equipment0.002210.03490.0190.6270.0020.035
203141/9/90Manufacture of Computing and Data Processing Equipment0.018110.40120.2260.7120.0180.437
2132Medical, Precision & Optical Instruments, Watches & Clocks0.018120.026100.0170.2260.0110.026
2233Transport Equipment0.05150.03880.0450.1470.0340.058
2334Other Manufacturing Industries0.017130.003190.0140.3760.0030.022
Sources: Data provided by the Singapore authorities; and staff estimates.
Sources: Data provided by the Singapore authorities; and staff estimates.

19. Table II.7 shows the share of exports in output, and thus measures the degree of openness. For the whole manufacturing sector, exports accounted for 60 percent of output in 1980 and 64 percent in 1999. Pharmaceuticals and bio-pharmaceutical products is the most open sector with exports representing 98 percent of output on average during 1980–99. The two main sectors, electronics and chemicals, export 77 percent and 80 percent of output, respectively.

Table II.7.Export Share in Output, 1980–99
198019991980–1999
IndustryDescriptionShareRankShareRankMeanStdMinMax
115–16Food, Beverage & Tobacco0.455150.407130.4720.0740.4070.548
217Textiles & Textile Manufactures0.473130.392140.4010.1080.3430.483
318Wearing Apparal Except Footwear0.71770.85530.7840.0680.6920.859
419Leather, Leather Products & Footwear0.389180.72680.3810.3340.2540.726
520Wood & Wood Products Except Furniture0.544110.292180.4260.2460.2300.544
621Paper & Paper Products0.138230.369150.3250.2630.1380.412
722Publishing, Printing & Reproduction of Recorded Media0.177220.249210.2040.1830.1450.255
823Refined Petroleum Product0.66390.270190.4820.3890.1850.666
924Chemicals and Chemical Products0.565100.80450.6650.1030.5290.804
102420Manufacture of Pharmaceutical and Bio-Pharm. products0.90521.18510.9750.0820.8181.185
1125Rubber & Plastic Product0.275190.328160.2510.1290.2060.328
1226Non-Metallic Mineral Products0.206210.186230.1320.3120.0740.206
1327Basic Metals0.411170.192220.2960.2220.1920.411
1428Fabricated Metal Products Excepet Machinery $ Equipment0.257200.310170.2610.0810.2290.310
1529Machinery & Equipment0.68180.619100.6480.1050.4960.812
1630Electric Machinery & Apparatus0.526120.550120.5430.0500.4900.595
1731Electronic Products & Components0.85650.77370.8400.0560.7650.926
183111Manufacture of Semiconductor devices0.88040.68990.8500.1530.6191.053
193120Manufacture of communications equipment0.73860.79860.8600.1260.6410.981
203141/9/90Manufacture of Computing and Data Processing Equipment0.92910.83240.8870.0470.7990.930
2132Medical, Precision & Optical Instruments, Watches & Clocks0.88130.90520.9070.0310.8500.966
2233Transport Equipment0.472140.562110.5540.1220.4470.680
2334Other Manufacturing Industries0.422160.265200.4410.1770.2650.553
24Total Manufacturing0.6060.6390.6220.0360.5990.669
Sources: Data provided by the Singapore authorities; and staff estimates.
Sources: Data provided by the Singapore authorities; and staff estimates.

H. Some Empirical Results

20. What are the determinants of labor productivity? Solow’s growth model predicts that inter-sectoral differences in labor productivity reflect simply differences in the capital-labor ratio. A simple test would be to regress the relative labor productivity index (RLPit) defined in Section D on the relative capital-labor ratio (RKLRit) defined in Section E.4 The equation is estimated using fixed effects on a panel of 1,539 observations. The indices i and t refer to sector i and year t. The t-statistic are given below the coefficient estimates:

As predicted, the relationship between these two variables is quite strong. Under constant returns to scale, the coefficient on log(RKLRit) should yield the share of physical capital in manufacturing value added (that is, 57 percent) which seems reasonable.

21. If the manufacturing sector in Singapore has moved up the value-added chain, factor inputs (labor and capital) should have been relocated to sectors with high productivity. This implies that variations in sectoral employment and variations in sectoral capital stocks should be positively correlated with relative labor productivity (RLP). The following two equations carry out this test, where the growth rate in the number of workers (Δlog(wit)) and the growth rate of the stock of capital (Δlog(kit)) are regressed on (RLPit), on a time trend, on the lagged dependent variable to take into account the adjustment process, real GDP to control for business cycle fluctuations, and fixed effects (not reported below) to control for other factors that are not explicitly introduced in the equation. The sample is a panel of 1,155 observations:

The regressions show a positive and statistically significant correlation between changes in factors of production and relative labor productivity suggesting that factor inputs have indeed moved toward sectors with higher labor productivity.

22. Another relevant question is whether the sectors which export a large share of their output are those with higher labor productivity as they face stiffer competition on international markets. To answer this question, RLP is regressed on the relative degree of openness (RDO) defined as the ratio of exports to output divided by the same ratio for the whole manufacturing sector. The equation is estimated using fixed effects on a panel of 1,540 observations:

The relationship between relative productivity and relative openness is very strong and implies that a sector that has a degree of openness (that is a ratio of exports to output) 10 percent larger than the manufacturing average will have labor productivity 1½ percentage points higher than the manufacturing average.

23. A final question is whether the magnitude of the business cycle fluctuations of Singapore’s economy has changed significantly between the 1980’s and the 1990’s. Comparing the volatility of real GDP growth during the periods 1980–89 and 1990–99 shows that fluctuations in real activity have indeed dampened. The standard errors of the growth rates of real GDP over 1980–89 and 1990–99 were, respectively, 4 percent and 3.2 percent, a decline of 20 percent in the magnitude of fluctuations in real GDP growth.5 A similar exercise for real value added in the manufacturing sector yields a standard error of 8½ percent for 1980–89 and 4½ percent for 1990–99, a decline of more than 50 percent in the amplitude of fluctuations in the manufacturing sector. Clearly, it is difficult to fully attribute any observed change to the effort to diversify the economy. Other key factors that affect the business cycle include the volatility of external demand and the macroeconomic management framework. However, Singapore has always been an open manufacturing-based economy and the framework for economic management has not changed significantly during the last two decades. Thus, albeit not definitive, the reduction in the magnitude of fluctuations suggests that the diversification effort has paid off in terms of reducing cyclical fluctuations.

I. Conclusion

24. The analysis above strongly supports the view that the Singaporean manufacturing sector has continued its fast pace transformation from low/medium value added sectors to high tech and high value added sectors during the last two decades. Electronics and chemicals account for more than 60 percent of value added and 35 percent of employment in the manufacturing sector. The electronics sector, while well established already in 1980, has consolidated its position and moved up the high tech product chain through investment both in physical capital and skill-upgrade. Growth in chemicals has outpaced even electronics and has allowed the Singaporean economy to diversify its manufacturing base with still significant growth potential ahead. The diversification effort coupled with the continuous upward shift along the value added chain in the manufacturing sector has contributed to both enhancing long term-growth and significantly reducing cyclical fluctuations in real output.

III. Singapore’s Financial Sector: Key Recent Developments And Reforms1

A. Introduction

1. In early 1998, recognizing that the financial sector was undergoing rapid change in an increasingly global environment, the Singapore authorities unveiled a program of comprehensive reforms aimed at making Singapore a predominant financial center.2 The overarching objective of the reforms were to overcome the disadvantage of the small size of the domestic market in Singapore and to compensate for the lack of a natural hinterland unlike other Asian financial centers such as Hong Kong and Tokyo. The strategy involved an active role for the government in promoting the industry, including through tax and other incentives, and reforms of the regulatory environment in a manner that maintained a robust financial system while at the same time encouraging innovation.

2. The reform program is comprehensive but gradual. It covers all segments of the financial sector, comprising traditional banking activities, the fund management industry, the bond market, equity markets, the insurance sector, the overall regulatory environment. To ensure smooth transition under this extensive reform, the implementation is being phased in gradually. Important changes have also taken place in the long-standing policy of not encouraging the internationalization of the Singapore dollar (see Chapter IV of this paper for a fuller discussion of this issue).

3. The main aim of this paper is to provide an update on the reforms implemented over the past year and to outline the remaining tasks and priorities. The rest of the paper is organized as follows: Section B covers reforms and recent developments in the bond market in Singapore; Section C contains a discussion of reforms of the banking system, including regulatory changes; Section D contains discussion of the fund management industry; Section E outlines key changes affecting other key segments on the financial sector; and Section F concludes.

B. The Bond Market

4. The efforts to develop the debt market have been proven timely by the experience of the Asian crisis which exposed the structural weaknesses that could arise from over dependence on the banking system for financial intermediation. Significant growth has also taken place in bond markets across Asia thus helping these countries reduce their reliance on short-term foreign capital inflows.

5. During the last consultation discussions, several areas were identified as priorities for future reforms of debt markets in Singapore. These included: (i) regulatory treatment of repos that constrained the development of the repo market—seen as one of the key building blocks of a vibrant debt market; (ii) underdeveloped markets for hedging products; (iii) inadequate liquidity in the swap market, where activity tends to be dominated by the needs of nonresident issuers of S$ bonds to swap the bond proceeds into foreign exchange for use outside Singapore; (iv) accounting regulations that discourage secondary trading of SGS; and (v) reforms to banks’ liquidity management frameworks to relieve them of the requirement to hold 18 percent of liabilities in liquid assets, of which 10 percent is to be held as Singapore Government Securities (SGS).3

6. A key prong of the strategy to develop the bond market in Singapore was to encourage domestic issuers to fund themselves in the domestic bond market. Statutory boards (public sector organizations) have been at the forefront of domestic issuance activity. The second prong was to encourage the entrance of foreign issuers to the market.

7. Many important initiatives have recently been taken to ensure that these objectives are met.

  • With the aim of building large and liquid benchmark issues, the authorities announced in May 2000, that the size of the benchmark issue would be raised from S$1.5 billion to at least S$2–2.5 billion.
  • In November 2000, the Monetary Authority of Singapore (MAS) carried out its first repurchase of SGS aimed at re-channeling liquidity from off-the-run issues into larger and more liquid benchmark bonds.
  • When the SGS issuance schedule for 2001 was announced late last year, the MAS announced the planned issuance of a 15-year bond in September 2001, with the aim of extending the benchmark yield curve beyond the current 10-year maturity.
  • Further steps were taken in December 2000 to boost the bond market by liberalizing the access to Singapore dollar credit to nonresidents.4 Specifically, banks are now allowed to lend to nonresidents in any amount, if the proceeds of such borrowing are to be used for investment in Singapore dollar assets. If the underlying position is sold, the funds are to be repaid in Singapore dollars. Funds not utilized in Singapore must still be swapped into foreign currency.
  • From March 2001, banks are no longer required to set aside reserves for S$ swap transactions that are of less than one-year maturity. Also, cross-currency swap transactions undertaken by banks for the purpose of swapping out debt issued by nonresidents do not require capital to be set aside against the position.
  • Previously, an offshore bank was allowed to receive S$ funds from any non-bank resident of Singapore pursuant to a currency swap only where the funds were not less than $250,000 and were raised through S$ bond issue managed by the bank. In March 2001, offshore licensed banks in Singapore were allowed to accept S$ funds of any amount from non-bank residents through swap transactions, whether or not the swap transaction is pursuant to a bond issue, thus enlarging the number of bank participants in the S$ swap market.
  • As for boosting the repo market, key steps were taken in May 2000 aimed at generating secondary market trading activity. These included the announcement that all SGS obtained as a result of a repo transaction will be counted toward satisfying the minimum liquid asset (MLA) ratio, regardless of the tenure and the counterparty. This compares to the previous policy whereby only overnight borrowings of SGS were allowed to be counted towards the MLA ratio.
  • To provide players with hedging mechanisms to manage their risk, SGX will be launching a SGS Bond Futures contract on June 29, 2001.
  • A number of tax incentives were also provided to boost the bond market. There is no capital gains tax in Singapore, but interest on bonds was subject to withholding taxes at a rate of 15 percent. In 1998, tax exemptions began to be granted on interest earned by nonresidents from Qualifying Debt Securities (QDS).5 In the 1999 budget, this tax exemption was extended to nonresidents who have permanent establishments in Singapore.6 Primary dealers in the Singapore bond market are exempted from paying tax on any profits derived from trading in the bond market until February 2003 and financial institutions in Singapore that arrange, underwrite and distribute QDS are exempt from tax on their fee income. Finally to develop the local swap market, the 2000 budget announced that profits derived from swaps trading would be taxed at the concessionary rate of 10 percent.
  • The approved bond intermediary (ABI) scheme was introduced in February 1999. Under this scheme, the MAS will evaluate a financial institution’s debt origination and trading capabilities in Singapore on an overall basis. Deals arranged by financial institutions granted ABI status would be regarded as “substantially arranged” in Singapore, and would quality for tax incentives for interest and fee income from holding, arranging, underwriting and distributing QDS.
Table III.1.Corporate Debt Market, 2000(in S$ billion)
Denominated In S$Denominated in Other Currencies
Total issuance14.436.1
Issuer Type
Financial Institutions0.41.8
Non-FI Corporates11.433.2
Non-residents2.61.1
Maturity of Issue
Less than 1 year2.330.6
1–9 years9.64.3
10 years and longer2.51.2
Outstanding Stock34.015.5
Source: Data provided by the Singapore authorities.
Source: Data provided by the Singapore authorities.

8. Results to date have surpassed most expectations and, although the concept is difficult to define precisely, critical mass appears to have been achieved in the bond market. From 1999 to 2000, the amount of corporate issuance increased by 57 percent from S$9.2 billion to S$14.4 billion for S$ denominated debts, and by 250 percent from S$10.3 billion to S$36.1 billion for non-S$ denominated debts. Moreover, the composition of issuer and maturity has been diverse for both S$ and non-S$ denominated debts (Table III.1 and Figure III.1). In addition, the SGS was recently included in the JP Morgan Government Bond Index Broad (Box III.1), suggesting the possibility of greater demand in the period ahead.

Figure III.1Corporate Bond Market, 1995-2000

Source: Data provided by Singapore authorities.

C. The Banking System

Liberalization and Consolidation

9. The major objectives of the banking system reform are two-fold: first, to continue to gradually open domestic banks to greater competition from foreign banks, and second, for Singapore banks to retain significant domestic market share in this more open environment as well as to become significant participants in the regional market. The latter objective is seen as critical to the ultimate survival of Singapore banks, because the domestic base is not large enough to support the growth of banks. The authorities have clearly stated that they see the process of mergers and consolidation of the local banks as inevitable, but that they do no intend to force the process. Rather they see it happening through competitive pressures in the market. Banks will have to make their own decision whether to consolidate, although the pressure on banks to consolidate and rationalise will grow. Alternatively, banks can choose to become niche players in specific segments.

Box III.1.Inclusion of Singapore Government Securities in the J.P. Morgan Government Bond Index1

J.P. Morgan Government Bond Indices are tools for measuring performance and quantifying risk across international fixed income markets. The index for developed country government debt markets is the Government Bond Index Global (GBI) that comprises government bonds from G-7 countries, Spain, Netherlands, Belgium, Denmark, Sweden, and Australia. The GBI Broad includes, in addition, government bonds of Finland, Ireland, New Zealand, Portugal, South Africa, Switzerland, and Austria.

As the Singapore Government Securities (SGS) market expanded over the past few years, Singapore was added to J.P. Morgan’s government bond index product line in November 2000, and included in the GBI Broad in April 2001 with estimated weight of ⅓ percent.

The SGS offer low yields—lower than the US Treasury bonds—but become an attractive instrument for portfolio diversification owing to the following covariance properties which help to expand the efficient portfolio frontier for bonds. The returns on the SGS have low cross correlations with returns from most other government bonds included in prototype investment portfolios. The very low volatility of returns in the SGS yields risk-adjusted returns that are higher than those from the UK and Japanese government bonds.

The MAS is also being proactive in promoting the SGS to international investors. The recent “nondeal” roadshow in London, Tokyo, New York and Boston, in which the authorities outlined their plans to issue a 15-year bond and bond futures, was well received. Also, the recently launched SGS web page provides a one-stop location which carries comprehensive information on the SGS market, including the issuance calendar, market statistics, relevant legislation, FAQs, and information on SGS primary dealers.

1This box draws on the following publications from J.P. Morgan, “J.P. Morgan Government Bond Indices,” September 30, 1997; “Introducing the Singapore Government Bond Index” November 27, 2000; and “Announcing the inclusion of Singapore in GBI Broad” March 22, 2001.

10. In May 1999, MAS announced a five-year program to liberalize the domestic banking market. The first phase of the banking liberalization program included new banking privileges and licenses for foreign banks granted over the period 1999–2001 and was aimed at increasing foreign bank participation and competition in the retail and the wholesale banking sectors. MAS is currently reviewing the experience with banking sector liberalization thus far and will decide on the next package of measures within 2001. Early indications are that the authorities may consider a more liberal definition of QFB privileges when the next phase is implemented.

11. The new privileges and licenses under the 1999 banking liberalization program comprise Qualifying Full Bank (QFB) privileges for up to six foreign banks, of which four QFB licenses were awarded in October 1999 and two more are expected to be issued in 2001. Banks with QFB privileges are allowed (i) up to ten locations (branches and ATMs) of which up to five can be branches. However, the actual setting up of branches or ATMs are to be phased over more than one year following the issue of the QFB privileges; (ii) existing branches can be freely relocated; and (iii) QFBs can share ATMs amongst each other, but not with the domestic banks.

12. As for the wholesale banking sector, the number of restricted bank licenses were increased from 13 in 1999 to 20 in 2000; and offshore licensed banks were allowed higher S$ lending limits of S$500 million (increased from S$300 million) and greater leeway to engage in S$ swaps. In particular, eight offshore banks were given Qualifying Offshore Bank (QOB) privileges which allowed them to increase lending in S$ to S$l billion from S$300 million. QOBs will also be allowed to accept Singapore dollar funds from nonbank customers through swap transactions.

13. Also in 1999, MAS lifted the 40 percent foreign shareholding limit for Singapore-incorporated banks and introduced an intermediate level of 12 percent of shareholdings as a new threshold requiring MAS’ approval. MAS’ approval is still required before a single shareholder can increase his/her shareholdings in a local bank above the already existing 5 percent, and 20 percent thresholds. This new threshold of 12 percent gives greater flexibility for the authorities to allow strategic partners and large institutional investors to cross the 5 percent shareholding level while retaining a way to check the growth of these shareholding before they approach the limit of 20 percent.

Regulatory Reforms

14. In addition to introducing greater competition, the reforms are aimed at making the regulatory and supervisory regime more progressive and clearly benchmarked to international best practice. The first of these changes is the revision to the capital adequacy framework. From September 2000, the minimum Tier 1 capital adequacy ratio (CAR) was lowered from 10 percent to 8 percent, while the total CAR was maintained at 12 percent. Furthermore, the definition of Tier 1 capital has been expanded to include innovative capital instruments with strong equity-like features up to 15 percent of Tier 1 capital. These changes will allow banks greater flexibility in their capital management. In line with the move away from a “one-size-fits-all” approach to one that is risk-focused and institution specific, MAS may, on the basis of its supervision of banks, require individual banks to maintain higher capital than the regulatory minimum when necessary.

15. Also, the authorities have announced that there will be a lower minimum paid-up capital requirement of S$100 million for banking subsidiaries of Singapore-incorporated banks, which have themselves met the S$1½ billion requirement. This would allow the setting up of Internet-only banks and other entities with new business models.

16. The second major change in the regulatory structure is the requirement that banks separate their financial and nonfinancial activities and to unwind cross-shareholdings. These changes are aimed at limiting the risks of contagion to banks from nonbanking activities, enhance market discipline, increase transparency and ensure that bank management focuses on the core business of banking and finance. Specifically, banks are required to group financial activities either under the bank itself or under a financial holding company structure. Nonfinancial activities must be segregated from the banking group and divested. The management of the financial entities and non-financial affiliates should be separate, and there should be no name-sharing. Although banks would not be allowed to actively undertake nonfinancial activities, they would be allowed to purchase noncontrolling stakes (10 percent or less) in the share capital of any company.

17. Since these changes will require local banks to undertake significant corporate restructuring, they will have a three-year grace period from the time the amendment to the Banking Act takes effect to comply with the new regulations.

18. As for key results to date, new QFBs have made use of the new privileges to relocate existing branches, and some have expanded their branch and ATM networks. However, foreign institutions’ share of domestic deposits and assets remain unchanged. Domestic banks have stepped up their efforts to extend their reach outside the region. Most recently, DBS has acquired a Hong Kong bank (Dao Heng Bank) and has issued capital for this purpose with great success. Also, moves are underway between the other domestic banks to consolidate through mergers and acquisitions.

D. The Fund Management Industry

19. A vibrant fund management industry is essential to broadening the investor base for Singapore capital market, and was appropriately identified as one of the key areas for development by a strategic review of Singapore’s financial sector undertaken in 1998. Several measures have since been undertaken to develop the industry.

  • In 1998, the MAS and the GIC announced plans to farm out part of their funds—S$10 billion and S$25 billion respectively—to external fund managers. About 40 percent of those funds have been placed so far with domestic and foreign fund managers, and the remainder will continue to be disbursed to qualified fund managers.
  • The CPF Investment Scheme was expanded to free up a larger amount of CPF funds for investment in specified instruments. CPF members will be allowed to invest all their balances in Special Account (SA) and Ordinary Account (OA) in approved retirement-related financial instruments, thereby raising the CPF funds available for investment from the current S$24 billion to S$65 billion. Allowed investment instrument include—though with some finer differences for SA and OA savings—fixed deposits in approved banks; government bond or statutory board bonds; government-guaranteed bonds; non-investment linked insurance products (endowment policies and deferred annuities); selected unit trusts, and; selected investment-linked insurance products. The limit on CPF members’ investments in individual stocks has been lowered from 50 to 35 percent of investible OA savings.
  • The MAS proposed to introduce a new modular licensing framework, to be implemented under the proposed Securities and Futures Act. MAS hopes to have the Act enacted by the second half of 2001. Under the new framework, market participants such as underwriters and fund managers, will only need to obtain a single license to provide a range of financial activities in the securities and futures market. By allowing market participants to obtain a single license, this modular licensing framework is expected to provide a more flexible and integrated regulatory framework, and to stimulate the development of more innovative products and the participation of more market players.
  • Being key institutional players on the demand side of the capital markets, fund managers are expected to add to the diverse range of groups with an interest in SGX’s business. Reflecting this capacity of fund managers, the MAS will generally allow fund managers who invest customer funds to hold the SGX shares beyond the 5 percent limit up to 10 percent with prior approval.
  • The MAS is also focusing on educating the public to develop the fund management industry further. The Financial Sector Development Fund (FSDF) was set up to facilitate the development and enhancement of talent and other infrastructure for Singapore’s financial sector. The FSDF supports three types of manpower development schemes: Executive Development Scheme, Global Enrichment Initiative, and Training Infrastructure Enhancement Scheme.

20. Under the supportive policy environment, the fund management industry has grown at a remarkable pace. In 1999, total assets under management grew by 82 percent to S$273 billion at end-1999 from S$151 billion at end-1998, and increased ten-fold from about S$20 billion in 1990. The number of large fund managers who manage over S$5 billion has also grown from three in the early 1990s to eleven in 1999. Despite difficult market conditions in 2000, the industry remained resilient and total assets under management in Singapore continued to increase to S$276 billion at end-2000 of which some S$166 billion were discretionary assets and S$l 10 billion were nondiscretionary assets (Figure III.2 and Table III.2).

Figure III.2.Fund Management Industry, 1995-2000

Source: Data provided by Singapore authorities.

Table III.2.Unit Trusts and Assets Under Management(AUM)
As at end-1999As at end-2000
NumberAUM

(S$ mil.)
NumberAUM

(S$ mil.)
Unit Trust included under CPFIS643,252105(64.1)4,705(44.7)
Unit Trusts not included under CPFIS1233,549160(30.1)3,138(-11.6)
Total1876,801265(41.7)7,843(15.3)
Source: Data provided by the Singapore authorities.
Source: Data provided by the Singapore authorities.

E. Other Segments of the Financial Sector

Equity Market

21. To support the continued growth of Singapore as an international financial center, the Singapore Exchange (SGX) aims at providing world-class capital markets infrastructure that mediate a free flow of capital across markets. This infrastructure will provide a variety of instruments, and serve both issuers and investors across time zones. More specific targets are: to bolster the Singapore-based business; to develop the business across borders through strategic alliances; and to extend the business portfolio to diversify the earnings mix.

  • The Stock Exchange of Singapore (SES) and Singapore International Monetary Exchange (SIMEX) were demutualized and merged into SGX in December 1999, to create a more vibrant exchange and to exploit synergies between securities and derivatives markets.
  • Alliances and cooperation with other exchanges have been expanded. In May 2000, SGX announced a joint venture with the American Stock Exchange to offer a series of exchange traded funds to investors across Asia. In June 2000, the SGX entered an agreement with the Australian Stock Exchange to create a cross-trading link for selected Singaporean and Australian listed equities, allowing investors mutual access to both markets. This link is expected to be active by end-2001. On the derivatives front, the GLOBEX Alliance, of which SGX is a member, extended its reach by having Spain’s Futures and Options Exchange as the sixth international partner in September 2000. SGX has also created an alliance with the National Stock Exchange of India Limited (NSE) and the India Index Services and Products Limited (IISL) for cooperation in areas relating to derivatives trading, market-information sharing, staff training and technical assistance.
  • Existing securities and futures legislation in Singapore is being rationalised, consolidated and updated through MAS’ proposed Securities and Futures Act (SFA). The impetus for the SFA is the introduction of some major policy reforms which would require a substantial rewriting the laws. These reforms include the revamp of the existing licensing framework, a redefinition of the scope of regulated activities, the importation of corporate fund-raising provisions and unit trust provisions from the Companies Act, and improvements in market enforcement. Further, with the merger of the SES and SIMEX into the SGX, there is a parallel need to consolidate and rationalize securities and futures legislation. Provisions in the Companies Act that relate to capital-raising by companies, as well as those governing unit trusts, will be migrated to the SFA to form a consolidated legislation.
  • The brokerage commission rates for SGX members were liberalized gradually, starting in January 2000, and culminating in the full liberalization in October 2000. Since then the commission rates have fallen significantly to average 40–50 bp for retail traders and 20 bp for institutional traders.
  • The trading and settlement system is being upgraded. In line with international best practice, the SGX shortened the settlement period to T+3 from T+5 in March 2000. The SGX has also embarked on a program to implement straight-through processing for stock trades by end-2002. In April 2001, the SGX launched SGX Access, an open connectivity platform for the SGX securities market, aimed at enhancing access to its marketplace, and giving its members the flexibility to employ their order management system of choice.

Insurance

22. The insurance industry was liberalized on the understanding that a more competitive insurance market is necessary to raise industry standards to the international best practice and place Singapore as a leading regional center for insurance services. In early 2000, the authorities announced an open-door policy on direct insurers and insurance brokers, and lifted aggregate foreign ownership limit on local direct insurers. The existing open policy admission to the reinsurance and captive insurance remains unchanged.

23. To improve the quality and efficiency of distribution, three broad strategies are being pursued. To lower cost and improve service, insurers are encouraged to adopt alternative distribution channels, including direct marketing, and the internet and tele marketing. To raise the professionalism of the agency system, the authorities are reviewing measures to encourage the growth of intermediaries that are qualified to provide a broader range of financial products. Finally, international best practice standards are recommended in the area of product and expense disclosure.

24. MAS is reviewing strategies to improve the risk responsiveness of the regulatory and supervisory regimes. Under consideration are risk-based capital models to determine the minimum capital that each life and general insurance company must maintain, as well as a risk-based supervisory approach in the inspection of insurance companies that will focus on areas of significant risk to each company.

F. Corporate Governance Reforms

25. In December 1999, the Ministry of Finance, together with the MAS and the Attorney-General’s Chambers, set up three private sector-led committees to review the corporate regulatory framework, disclosure standards and corporate governance in Singapore. Three committees are: the corporate governance committee, the disclosure and accounting standards committee, and the company legislation and regulatory framework committee.

26. The corporate governance committee produced the code of corporate governance, which was accepted by the government in April 2001. The code will prescribe a set of corporate governance guidelines for listed companies in Singapore. The disclosure and accounting standards committee is soliciting public comments on its second consultation paper. The company legislation and regulatory framework committee has been given the mandate to recommend revisions to the Companies Act, which can be accomplished only after the other two committees complete their activity and finalize the recommendations. In a related development, regulation on insider trading has been strengthened. The introduction of civil penalty regime for insider trading in March 2000 to complement the existing criminal regime has given MAS the power to undertake civil actions against insider trading. It also provides for contemporaneous investors to file a civil claim against a person who has engaged in insider trading. MAS has further proposed to tighten its insider trading laws, including a shift from current person-connected approach to an information-connected approach. MAS has also proposed to extend the civil penalty and civil claim regime to other forms of market misconduct such as market manipulation, the dissemination of false or misleading information and the employment of fraud or deceit in dealing.

G. Concluding Remarks

27. Steady liberalization of the financial sector in recent years has brought about a sea-change in Singapore’s financial sector, and the landscape has now come close to the vision set out in early 1998. The institutional environment is already at par with the international best practice in most areas, and continues to be reviewed and upgraded. Activity has also picked up sharply in a number of segments including the bond market and asset management industry.

28. Challenges ahead are continued growth in the capital market and improved efficiency and international competitiveness in the banking sector, while completing the transformation of the supervisory framework to a more progressive risk-based regime. The forthcoming FSAP (planned for late 2001/early 2002) will contribute to assessing the progress so far and planning for future development of the financial sector.

IV. Evolution Of The Policy On Noninternationalization Of The Singapore Dollar1

A. Introduction

1. Singapore has long maintained several restrictions against the international use of its currency, generally referred to as the policy of “not encouraging the internationalization of the Singapore dollar.” The policy has been liberalized in stages since the late 1990s, and the most recent and significant liberalization was announced in December 2000. Even before the recent liberalization, the policy posed few impediments to international trade and capital flows, for the policy was intended not to inhibit free flow of bona fide capital but to limit speculative activities in Singapore’s financial markets. However, the effect of this policy on protecting the Singapore dollar from speculative attacks is difficult to assess, as it cannot be disentangled from the impact of the solid policy track record and credibility. This note traces the evolution of this policy since the 1980s and assesses its effect on Singapore’s integration with the international financial market.

B. The Early Years: Notice 621

Access to the Singapore dollar is restricted for both residents and nonresidents.

2. The noninternationalization policy took root in the early 1980s. After lifting all exchange controls in the late 1970s, in line with efforts to develop offshore financial markets in Singapore, the Monetary Authority of Singapore (MAS) took the position that it would not encourage the internationalization of the Singapore dollar beyond the need to support bona-fide economic transactions. This position of the authorities was well stated in a parliamentary statement by the Minister of Finance in 1980.

The Singapore dollar has traditionally been used to finance some of our entrepôt and regional trade. There are no restrictions on the use, or international use, if you like, of our currency for this purpose. At the same time, there has also been no official encouragement for the wider use of our currency. It is not my intention to accelerate such use. If by “internationalization,” the Honourable Member means also the use of the Singapore dollar as a reserve currency, I have to say that like many more developed countries, such as Germany and Japan, this will not be welcomed.

3. The policy was codified into MAS Notice 621 in November 1983, which reads:

Banks should observe the Authority’s policy discouraging the internationalization of the Singapore dollar. Specifically, banks should consult with the Authority before considering Singapore dollar credit facilities exceeding S$5 million to nonresidents, or to residents where the Singapore dollars are to be used outside Singapore.2

The Notice allowed banks to freely extend credit facilities to nonresidents up to S$5 million, and required prior consultation for credit facilities exceeding S$5 million, without expressly prohibiting such transactions. The same consultation limit also applied to credit facilities to residents wishing to use the S$ proceeds overseas.

4. A major amendment was made to MAS Notice 621 in 1992. The consultation requirement was lifted for the extension of S$ credit facilities of any amount, where the S$ funds are used for the following activities that are closely tied to economic activities in Singapore.

  • Direct exports from and imports into Singapore
  • Forward sales of Singapore dollars to hedge receipts from exports to Singapore
  • Bond issuance for economic activities in Singapore in favor of Singapore parties
  • Guarantee of payments arising from construction or other economic activities in Singapore including guarantee for tax payments.

5. Banks were required to continue to consult with MAS on the extension of credit facilities exceeding S$5 million to nonresidents for purposes other than those listed above, or to residents for use outside Singapore. The intention was to limit the availability of S$ credits for speculative activities by nonresidents or for activities outside Singapore, which MAS stated in the Notice as:

We have no wish to facilitate external speculative activities in our financial or property markets by allowing credit facilities in Singapore dollars, for whatever amounts, to be extended to nonresidents. Banks must also not finance in Singapore dollars, activities which have no bearing on Singapore, e.g. third country trade or activities outside Singapore.

C. The New Era: Notice 757

All restrictions on residents lifted; several restrictions on nonresidents also lifted.

6. The regime under Notice 621 continued to serve the Singapore economy through the most of the 1980s and 1990s, until the recent wave of liberalization was launched in August 1998, together with the extensive program of financial sector liberalization. Concluding a review of the noninternationalization policy as part of the review of measures to develop the financial sector, MAS stated;

We concluded that the basic policy remains sound. However, some judicious relaxation of specific restrictions would foster the development of capital markets with minimal incremental risks.

In accordance, MAS issued Notice 757, which substituted for Notice 621. The liberalizations associated with subsequent versions of Notice 757 were intended to relax restrictions against various financial transactions, which have become more important for Singapore’s effort to develop its capital markets.

7. Notice 757 of August 1998 relaxed the consultation requirement that was maintained in Notice 621. The consultation requirement was lifted for a broader set of S$ credit facilities to nonresidents, for which prior consultation with MAS was required under Notice 621. Moreover, Notice 757 fully liberalized the extension of S$ credit facilities to residents. The consultation requirement was also lifted for arranging equity listing and bond issues by nonresidents intended for economic activities in Singapore, and for transacting in several derivative products. Specifically, banks could now engage in the following activities without prior consultation with MAS.

  • Banks could extend S$ credit facilities to residents for any purposes, domestic or overseas.
  • Banks could extend S$ credit facilities to or arrange S$ equity listings or bond issues for nonbank nonresidents if the S$ proceeds are used for designated economic activities in Singapore. Hedging of currency or interest rates from these economic activities could also be arranged without consultation with MAS.
  • Banks could extend S$ credit facilities to nonbank nonresidents for financial investments—shares, bonds, deposits, and commercial properties in Singapore—up to S$5 million.
  • Banks could extend S$ credit facilities up to S$20 million to nonresidents, via repurchase agreements of Singapore Government Securities (SGS).
  • Banks could engage in a limited list of derivative transactions, including hedging that was allowed above, and transacting S$ interest rate futures with nonresidents.

8. However, banks were required to continue to consult MAS for activities not permitted above, including extension of S$ credit facilities for financial investments, where the amount would exceed S$5 million. In particular:

  • Banks must consult MAS before extending S$ credit facilities of any amount to nonresidents for use in overseas projects.
  • Banks must consult MAS before transacting with nonresidents financial derivatives that are not pre-authorized, including S$ currency options, S$ forward rate agreements, and interest rate swaps and options.
  • The S$ proceeds from credit facilities extended to nonresidents, including S$ proceeds from bond issues for all overseas projects must be converted or swapped into foreign currency for use outside Singapore.

9. Finally, the extension of S$ credit facilities for certain purposes was explicitly prohibited. This, however, does not imply a tightening of the restrictions against such transactions, which are likely to have been declined by MAS previously in response to the consultation required under Notice 621. Instead, Notice 757 can be viewed to have made explicit the policy stance on such transactions for the first time in the MAS Notice. Specifically, banks were prohibited from extending S$ credit facilities to nonresidents for speculating in the S$ currency and interest rate markets; financing third-country trades; financing acquisition of shares of companies not listed on the Stock Exchange or Central Limit Order Book; and financing any activities outside Singapore, except when approved by MAS.

10. Notice 757 was further liberalized in November 1999, to contribute to the development of Singapore’s capital markets (see Annex for details on the 1999 version of Notice 757). Banks were now allowed to engage in an expanded range of activities without prior consultation with MAS, including transactions in S$ interest rate products with other banks or finance companies; extension of S$ credit facilities of any amount to nonresidents via repos of SGS or other S$ bonds; arranging S$ equity listings for nonresidents companies as long as the S$ proceeds are converted into foreign currency before being used outside Singapore; and extension of S$ credit facilities to nonbank nonresidents up to S$5 million for any purposes. However, the S$ proceeds from credit facilities extended to nonresidents for overseas projects were required to be converted or swapped into foreign currency for use outside Singapore. The commitment to the noninternationalization policy was reiterated through the MAS press release in November 1999 when “… the Authority reaffirmed the basic thrust of our noninternationalization policy.”

D. Virtual Internationalization: Notice 757 in December 2000

Only measures to limit access to S$ for speculative activity remain.

11. The third and most extensive liberalization measures were announced in December 2000, which have eliminated most hurdles against nonresident access to S$ credit facilities for economic and financial transactions in Singapore. The following have been major amendments to the requirement for prior consultation with MAS.

  • Banks can lend S$ to nonresidents for investment purposes—financial assets and real estate—in Singapore.
  • Banks can extend S$ credit facilities exceeding S$5 million to nonresidents to fund offshore activities, as long as the S$ proceeds are swapped into foreign currency. In this instance, banks are not allowed to convert the S$ proceeds into foreign currency via the spot or forward market.
  • Banks can transact in S$ currency options with other banks and financial institutions in Singapore.
  • Banks can transact with nonresidents in a broad range of derivative products, including cross currency swaps and currency options for hedging purposes, S$ interest rate derivatives, and equity derivatives.

12. The current Notice 757 imposes virtually no binding restrictions on capital market activities, a verdict also reached by market participants. The cross country comparison also confirms the lightness of restrictions under Notice 757 (Table IV.1). The legacy of the noninternationalization policy now boils down to the prohibition of extending S$ credit facilities for speculative activities in the S$ currency market and restrictions against outflow of S$ accounts above S$5 million—the swap/conversion requirement. These measures are intended, in the words of MAS, “to limit borrowing of S$ by nonresidents for currency speculation, and to discourage the development of an offshore S$ market.” The latter objective, however, does not purport to suppress the offshore S$ market. While MAS would discourage a further development of the offshore S$ market, market participants and the authorities are unanimous in the view that there currently exists a fairly liquid offshore S$ market, which is deep enough to enable market participants to use S$ as a proxy for regional currencies.

E. Has the Policy Caused Major Distortions?

13. Despite several restrictions that were imposed to limit the offshore use of the Singapore dollar, evidence suggests that this has not impeded the growth of trade or capital mobility. Singapore has maintained open trade regime and has served as the regional base for entrepot trade: exports and imports each exceeded 150 percent of GDP in the 1980s and 1990s, with entrepot trade accounting for about a third of them.

14. Capital and financial accounts were also highly open since the removal of exchange restrictions in the late 1970s. The volume of international capital flows has been high, with gross flows averaging nearly 40–50 percent of GDP in the 1980s and 1990s, respectively (Figure IV.1). The flows of foreign direct investment (FDI) have been high from the early period, reflecting Singapore’s commitment to bring in multinational corporations for its economic development, and averaged about 10 percent of GDP in both decades. Portfolio flows were relatively moderate for both inflows and outflows, but outflows picked up in the 1990s, reflecting the large saving of Singaporeans that are invested overseas. The high volume of gross flows in other investment reflected the lively interaction between domestic banks and Asian Currency Units and other nonresidents.

Figure IV.1Singapore: Capital Flows, 1980–1999

Source: IMF, International Financial Statistics.

15. Various interest parity conditions held up during the 1990s before the Asian crisis, according to a recent study by MAS (2000), which provides price-based evidence of capital account openness. Not only did the covered interest parity condition hold, as is the case with most countries with well developed money and foreign exchange markets, but the uncovered interest parity condition also held during this period unlike most other countries. The parity conditions indicate that Singapore’s money market has been fully integrated with international markets.

16. Singapore’s integration with international financial markets has been made possible partly by the narrow scope of the restrictions that were in place to discourage the internationalization of the Singapore dollar. From the beginning, the restrictions have been imposed on selected asset-side transactions of the bank balance sheet, with no restrictions on the liability side. The major focus of the restrictions was to limit the offshore use and availability of the currency for speculative activities. Thus with few restrictions on depositing or withdrawing bona fide funds in the banking system, interest rate differentials could be arbitraged away quickly, as evident in the various parity conditions.

17. These restrictions alone, therefore, are unlikely to have been the single most important factor in protecting the Singapore dollar against the speculative attack. Indeed, a number of factors have contributed to discouraging speculation against the currency. Singapore has maintained very high levels of external reserves, averaging 80 percent of GDP in the 1990s. Policy management has been prudent on both fiscal and monetary side, and thus has enjoyed very high credibility. As a result, no substantial macroeconomic imbalances built up: studies of the equilibrium exchange rates show that there has been no substantial or sustained deviation between the actual and the equilibrium exchange rate measured in various ways. Montiel (1997) and Lee (1999) find, for different sample periods with the latter including the crisis period, that the real exchange rate of Singapore has been broadly in line with the equilibrium exchange rate based on macroeconomic fundamentals.

18. It thus appears fair to conclude that the absence of speculative attacks against the Singapore dollar was not so much due to these restrictions as due to sound economic fundamentals. Through the past two decades, the authorities have been committed to the policy of free trade and capital mobility, aside from consultation requirements for speculative transactions. With the domestic economy fully integrated with the international economy, the maintenance of both internal and external macroeconomic balance was critical to avoid sharp corrections. This discipline was well heeded by a prudent policy management. Against this background, there was little incentive to wage a speculative attack against the currency, or to circumvent the restrictions for speculative purposes.

19. Supportive evidence for this assessment can also be found in the comparison of the experience by Korea and Singapore during the Asian crisis (Ishii et al (2001)). At the dawn of the crisis, Korea maintained more extensive restrictions against the offshore use of the currency than Singapore. Nevertheless, Korea fell prey to speculative attack and its currency depreciated sharply initially, until market confidence and stability were restored following policy reforms and an agreement to extend external credit lines. In contrast, the speculative pressure against the Singapore dollar was much less significant, largely owing to Singapore’s strong economic fundamentals and the credibility of policy management.

20. Finally, it should also be noted that the authorities have remained vigilant to ensuing that the restriction did not become overly binding against the development of the economy. The most recent example has been the effort to further develop the domestic capital market. For example, Gobat (2000) noted the importance of allowing more short-sales of securities and access to domestic currency credit lines in deepening market liquidity. As the risk increased that restrictions would hamper the development of the domestic capital market, the authorities relaxed them in a preemptive manner, before the restrictions obstructed market activities and strengthened the incentives for circumvention. As the result, the remaining set of restrictions is regarded as nonbinding by the market, especially cast against the background of strong fundamentals.

F. Conclusion

21. The noninternationalization policy needs to be appraised from the perspective of overall macroeconomic policy framework of Singapore, which has been remarkable in maintaining the internal and external balance. As noted earlier, it is difficult to disentangle the effects of the measures to curb the international use of the Singapore dollar on insulating Singpaore from speculative attacks from the overall macroeconomic policy track record. The noninternationalization policy clearly has had a strong signalling effect in deterring potential speculative activity against the S$. However, without the strong and credible policy record, the noninternationalization policy is not likely to have been defensible for over two decades under the highly open regime for capital and financial accounts.

ANNEX: November 1999 version of Mas Notice 621

Banks were allowed to engage in the following activities without prior consultation with MAS.

  • Banks could extend S$ credit facilities or transact S$ interest rate products with other banks, merchant banks, finance companies or insurance companies in Singapore.
  • Banks could extend S$ credit facilities of any amount to nonresidents, via repurchase agreements of Singapore Government Securities (SGS) or S$ denominated bonds listed on the Stock Exchange of Singapore (SES).
  • Banks could extend S$ credit facilities to nonbank nonresidents up to the maximum of S$ 5 million.
  • Banks could arrange S$ bond issue for nonresidents if the proceeds are used for designated economic activities in Singapore.
  • Banks could arrange S$ equity listings for nonresidents, but have to ensure that the proceeds must be converted into foreign currency before drawdown if they are not to be used for designated economic activities in Singapore.
  • Banks could transact S$ derivatives with residents freely, and engage in an expanded range of derivative transactions with nonresidents, including option-related products with nonbank counterparties.

Banks were required to consult MAS for activities not permitted in the Notice, including the following activities in particular:

  • Banks must consult MAS before extending S$ credit facilities above S$ 5 million to nonresidents except for a few purposes expressly permitted in the Notice.
  • Banks must consult MAS before transacting S$ current options or option-related products with nonbank financial institutions, and before extending S$ credit facilities exceeding S$5 million to banks and other financial institutions outside Singapore.
  • Banks are not allowed to transact S$ currency options or option-related products with other banks.

The S$ proceeds from credit facilities extended to nonresidents for all overseas projects must be converted or swapped into foreign currency for use outside Singapore.

Table IV.1.Major Regulations on the Offshore Use of Currencies in Selected Asian Countries1(as of December 31, 2000)
Nature of the TransactionIndonesiaKoreaMalaysiaPhilippinesSingaporeThailand
Imports of domestic currencyApprovalNotificationApprovalApprovalFreeFree
Exports of domestic currencyApprovalApprovalApprovalApprovalFreeQuantity limit
Use of domestic currency in settlement of trade transactionsProhibitedMostly ProhibitedProhibitedMostly ProhibitedFreeFree
Nonresident holding of or transfers between/ from domestic currency accountsLargely ProhibitedRestrictedApprovalRestrictedFreeRestricted
Resident domestic currency deposits abroadRestrictedFreeProhibitedFreeFreeMostly Prohibited
Domestic currency lending from residents to nonresidentsLargely ProhibitedRestrictedLargely ProhibitedRestrictedRestrictedLargely Prohibited
Banks’ derivative transactions in domestic currency w/ nonresidentsQuantity limitRestrictedApprovalRestrictedRestrictedRestricted
Domestic currency lending to residents from nonresidentsRestrictedApprovalProhibitedApprovalQuantity limitLargely Free
Nonresidents issue/ sale of domestic currency assets locallyLargely ProhibitedApprovalApprovalApprovalRestrictedApproval
Nonresidents’ purchase of domestic currency assets locallyQuantity LimitLargely FreeApprovalRestrictedRestrictedRestricted
Residents’ issue/sale of domestic currency assets abroadApprovalReport/ApprovalApprovalApprovalFreeApproval/Prohibition

Based on Table 1 in Ishii et al (2001). The categories refer to the key element of restrictions, and do not reflect full details which can be found in the original table. The category “Restricted” often involves requirements of prior approval or consultation on selected transactions, and thus are more lightly regulated than the category “Approval” which require prior approval on a broad spectrum of transactions.

Based on Table 1 in Ishii et al (2001). The categories refer to the key element of restrictions, and do not reflect full details which can be found in the original table. The category “Restricted” often involves requirements of prior approval or consultation on selected transactions, and thus are more lightly regulated than the category “Approval” which require prior approval on a broad spectrum of transactions.

References

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    IshiiShogoInciOtker-Robe and LiCui2001Measures to Limit the Offshore Use of Currencies: Pros and Cons,Working Paper 01/43 (Washington: International Monetary Fund).

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    LeeJaewoo1999Singapore: Competitiveness Issues,Singapore-Selected Issues 99/53 (Washington: International Monetary Fund).

    Monetary Authority of Singapore2000Financial Market Integration in Singapore: The Narrow and The Broad Views” (Singapore).

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    OstryJonathan D.1997Are Current Account Imbalances in ASEAN Countries a Problem?Macroeconomic Issues Facing ASEAN Countries Chapter 4 (Washington: International Monetary Fund).

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STATISTICAL APPENDIX
Table 1.Singapore: Expenditure on Gross Domestic Product at 1990 Market Prices, 1996–2001
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
(In millions of Singapore dollars)
Gross domestic product110,699120,140120,207127,250139,84032,99034,60035,71336,53734,477
Domestic demand101,243110,892102,193107,565119,04529,64629,63629,44130,32229,848
Consumption57,14560,69160,19863,34069,85418,45516,52216,90917,96818,698
Private46,12248,88447,45249,96254,64113,03513,88713,94013,77913,979
Public11,02311,80612,74713,37815,2135,4192,6342,9704,1894,719
Gross capital formation44,09850,20141,99544,22649,19111,19113,11412,53212,35411,149
Gross fixed investment45,51449,87146,65944,85847,50111,12911,73612,92311,71311,851
Private37,84340,48936,49134,27337,2208,4139,41410,3809,0138,836
Public7,6709,38210,16810,58510,2812,7162,3222,5432,7003,014
Increase in stocks-1,416330-4,664-6331,690621,378-391641-701
Net exports of goods and nonfactor services11,16811,66420,32822,24323,4494,0165,6016,9416,8915,279
Statistical discrepancy-1,712-2,416-2,314-2,559-2,654-672-637-669-676-650
(Percentage change over corresponding period of previous year)
Gross domestic product7.68.50.15.99.99.88.410.311.04.5
Domestic demand12.89.5-7.85.310.712.411.95.912.70.7
Consumption9.76.2-0.85.210.39.09.39.013.91.3
Private7.66.0-2.95.39.49.99.89.68.27.2
Public19.37.18.05.013.76.86.46.238.0-12.9
Gross capital formation17.113.8-16.35.311.218.415.52.010.9-0.4
Gross fixed investment23.19.6-6.4-3.95.94.65.08.35.56.5
Private27.37.0-9.9-6.18.611.27.010.55.95.0
Public5.722.38.44.1-2.9-11.6-2.3-0.14.211.0
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 2.Singapore: Expenditure on Gross Domestic Product at Current Market Prices, 1996–2000
19961997199819992000
(In millions of Singapore dollars)
Gross domestic product128,201140,228138,529142,111159,042
Domestic demand112,480124,300112,902117,517129,962
Consumption64,94969,63668,10571,41880,186
Private52,74156,45654,19857,42963,565
Public12,20813,18013,90713,98916,621
Gross capital formation47,53154,66444,79746,09949,776
Gross fixed investment49,30354,26051,11047,05046,848
Private40,83543,60039,63535,77337,219
Public8,46810,66111,47511,2779,629
Increase in stocks-1,771404-6,313-9512,928
Net exports of goods and nonfactor services17,55318,75427,28927,48029,364
Statistical discrepancy-1,833-2,826-2,727-2,886-284
(In percent of GDP)
Domestic demand87.788.681.582.781.7
Consumption50.749.749.250.350.4
Private41.140.339.140.440.0
Public9.59.410.09.810.5
Gross capital formation37.139.032.332.431.3
Gross fixed investment38.538.736.933.129.5
Private31.931.128.625.223.4
Public6.67.68.37.96.1
Increase in stocks-1.40.3-4.6-0.71.8
Net exports of goods and nonfactor services13.713.419.719.318.5
Statistical discrepancy-1.4-2.0-2.0-2.0-0.2
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 3.Singapore: Gross Domestic Product by Industry at 1990 Market Prices, 1996–2001
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
(In millions of Singapore dollars)
Gross domestic product110,699120,140120,207127,250139,84032,99034,60035,71336,53734,477
Goods producing industries38,44441,34241,58144,53549,05410,96112,16612,70913,21911,172
Manufacturing27,18228,39928,23932,08936,9747,9989,2059,59110,1808,179
Construction9,18310,66210,97610,0129,5552,3672,3242,4742,3902,367
Utilities1,8692,0702,1712,2412,334550591596598575
Other goods industries2102101961941914745485150
Services producing industries75,09382,30982,06585,15992,71422,52022,96723,48023,74723,740
Wholesale and retail trade18,52319,71318,90220,23423,3135,5825,7045,8156,2125,967
Hotels and restaurants3,5743,8043,6703,6593,9599859739851,016999
Transport and communications14,47615,75116,70317,94919,5574,7134,8925,0294,9234,932
Financial services13,06915,50214,21814,28614,8773,6063,7513,8013,7193,712
Business services13,52214,65115,33315,03116,0173,8694,0004,0634,0854,077
Other service industries11,92912,88713,23914,00014,9913,7663,6473,7863,7914,052
Owner occupied dwellings3,6803,8934,1814,4944,7721,1681,1831,2011,2211,238
Taxes and duties on imports6726947068341,035220250270295289
Imputed bank service charge-7,190-8,097-8,217-7,773-7,736-1,880-1,966-1,947-1,944-1,962
(Percentage change over corresponding period of previous year)
Gross domestic product7.68.50.15.99.99.88.410.311.04.5
Goods producing industries7.47.50.67.110.16.58.911.013.71.9
Manufacturing2.94.5-0.613.615.213.213.215.218.82.3
Construction23.116.12.9-8.8-4.6-10.9-3.9-1.1-1.90.0
Utilities7.310.84.93.24.24.64.23.54.34.6
Other goods industries3.50.1-6.9-1.1-1.53.3-7.2-2.91.06.6
Services producing industries8.19.6-0.33.88.910.47.29.28.75.4
Wholesale and retail trade6.16.4-4.17.115.217.315.315.413.16.9
Hotels and restaurants6.06.5-3.5-0.38.210.76.89.95.61.5
Transport and communications8.28.86.07.59.09.99.79.56.84.6
Financial services7.318.6-8.30.54.111.6-4.03.17.53.0
Business services9.48.34.7-2.06.65.26.57.47.15.4
Other service industries10.98.02.75.77.16.06.18.37.97.6
Owner occupied dwellings5.95.87.47.56.26.36.65.86.16.0
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 4.Singapore: National Saving, Capital Formation, and the Current Account, 1996–2000
19961997199819992000
(In millions of Singapore dollars)
Gross national saving65,61181,28278,82882,96587,353
Government1/15,78515,45413,97614,71214,630
Private sector and other49,82665,82864,85268,25372,723
CPF savings 2/6,5317,0915,6193,1201,901
Gross capital formation47,53154,66444,79746,09949,776
Gross fixed investment49,30354,26051,11047,05046,848
Public8,46810,66111,47511,2779,629
Private40,83543,60039,63535,77337,219
Increase in stocks-1,771404-6,313-9512,928
Current account balance18,08026,61834,03136,86637,576
Net exports of goods and services17,55318,75427,19027,42829,364
Net factor income from abroad2,0319,6009,97911,23310,555
Net transfers from abroad-1,505-1,736-1,982-1,973-2,342
Memorandum item:
GDP128,201140,228138,529142,111159,042
(In percent of GDP)
Gross national saving51.258.056.958.454.9
Government 1/12.311.010.110.49.2
Private sector and other38.946.946.848.045.7
CPF savings 2/5.15.14.12.21.2
Gross capital formation37.139.032.332.431.3
Gross fixed investment38.538.736.933.129.5
Public6.67.68.37.96.1
Private31.931.128.625.223.4
Increase in stocks-1.40.3-4.6-0.71.8
Current account balance14.119.024.625.923.6
Net exports of goods and nonfactor services13.713.419.619.318.5
Net factor income from abroad1.66.87.27.96.6
Net transfers from abroad-1.2-1.2-1.4-1.4-1.5
Sources: Data provided by the Singapore authorities.

The government’s current surplus (calendar year figures estimated from fiscal year data as percent of GDP).

Change in amounts due to members.

Sources: Data provided by the Singapore authorities.

The government’s current surplus (calendar year figures estimated from fiscal year data as percent of GDP).

Change in amounts due to members.

Table 5.Singapore: Gross Fixed Investment at 1990 Market Prices, 1996–2000
19961997199819992000
(In millions of Singapore dollars)
Gross fixed investment45,51449,87146,65944,85847,501
Gross fixed investment (private)37,84340,48936,49134,27337,220
Construction and works14,84916,35215,45212,80113,261
Residential buildings7,5588,8168,4807,3226,579
Nonresidential buildings6,8656,9556,2734,8666,049
Other construction and works427581700613633
Transport equipment8,2767,9026,4425,7203,456
Machinery and equipment14,71816,23614,59715,75220,504
Gross fixed investment (public)7,6709,38210,16810,58510,281
Construction and works6,9728,7329,3269,6089,062
Residential buildings3,2964,0204,3323,8903,121
Nonresidential buildings1,7992,3452,4202,9682,804
Other construction and works1,8762,3662,5752,7493,137
Transport equipment65491034875
Machinery and equipment6346027399291,144
(Percentage change over previous year)
Gross fixed investment23.19.6-6.4-3.95.9
Gross fixed investment (private)27.37.0-9.9-6.18.6
Construction and works25.010.1-5.5-17.23.6
Residential buildings30.416.6-3.8-13.6-10.2
Nonresidential buildings17.41.3-9.8-22.424.3
Other construction and works79.436.020.4-12.43.2
Transport equipment47.0-4.5-18.5-11.2-39.6
Machinery and equipment20.510.3-10.17.930.2
Gross fixed investment (public)5.722.38.44.1-2.9
Construction and works18.725.26.83.0-5.7
Residential buildings27.922.07.8-10.2-19.8
Nonresidential buildings11.830.33.222.7-5.5
Other construction and works11.226.18.86.814.1
Transport equipment-74.1-24.9112.6-53.356.5
Machinery and equipment-44.1-5.022.625.823.1
Sources: Data provided by the Singapore authorities.
Sources: Data provided by the Singapore authorities.
Table 6.Singapore: Changes in Productivity and Earnings, 1996–2001 (Percentage change over corresponding period of previous year)
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Productivity, total economy1.32.3-2.36.35.66.74.65.55.5-1.0
Manufacturing2.95.51.717.511.511.411.011.112.5-3.6
Construction-2.0-3.3-2.6-3.6-3.3-7.2-2.1-1.3-2.4-0.7
Wholesale and retail trade3.23.9-3.38.811.015.011.49.97.81.6
Hotels and restaurants2.91.9-5.24.05.98.34.48.02.9-1.3
Transport and communications3.44.63.86.24.06.24.94.30.7-1.1
Financial services1.29.3-10.0-0.6-3.54.0-11.6-5.1-1.3-5.1
Business services0.2-0.4-2.7-5.0-3.4-4.6-2.9-2.7-3.2-6.5
Other Services Industries4.60.2-1.60.01.80.70.83.02.82.3
Average monthly earnings, total economy5.85.72.82.78.98.17.28.711.15.7
Manufacturing7.67.22.73.28.39.46.88.38.56.0
Construction1.51.04.03.94.85.12.44.17.3-1.0
Services5.65.52.92.39.27.87.79.011.9
Wholesale and retail trade5.95.32.50.96.26.84.25.28.21.8
Transport and communications7.36.43.61.29.512.45.812.07.83.8
Financial services6.27.71.92.98.910.814.88.13.45.8
Real estate and business services4.55.22.11.87.48.15.46.09.34.9
Community, social and personal services4.34.23.45.112.93.29.012.522.011.7
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 7.Singapore: Unit Labor Costs, 1996–2001 (Annual percent change)
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Total economy
Average earnings 1/5.85.72.82.78.98.17.28.711.15.7
Average labor costs 2/3.93.00.5-2.04.65.04.15.14.45.1
Labor productivity1.32.3-2.36.15.66.74.65.55.5-1.0
Unit labor costs2.60.72.7-8.1-1.0-1.7-0.5-0.4-1.16.1
Manufacturing sector
Average earnings 1/7.67.22.73.28.39.46.88.38.56.0
Average labor costs 2/5.26.20.60.24.45.04.55.33.04.4
Labor productivity2.95.51.717.511.511.411.011.112.5-3.6
Unit labor costs2.30.7-1.1-17.3-7.1-6.4-6.5-5.8-9.58.0
Unit business costs0.5-0.1-0.6-10.4-1.1-2.3-1.40.7-1.16.8
Sources; CEIC database; and data provided by the Singapore authorities.

Refers to CPF contributors; from 1992 onwards, excludes the self-employed.

Derived as a residual.

Sources; CEIC database; and data provided by the Singapore authorities.

Refers to CPF contributors; from 1992 onwards, excludes the self-employed.

Derived as a residual.

Table 8.Singapore: Employment by Industry, Midyear, 1996–2000
19961997199819992000
(In thousands of persons)
Total labor force1,8021,8761,9321,9762,192
Total employment1,7481,8311,8701,8862,095
Manufacturing406414404396435
Construction115126131131274
Services1,2141,2701,3171,3421,373
Wholesale and retail trade292295281279287
Hotels and restaurants114104119121114
Transport, storage, and communications195210206204197
Financial intermediation9510610910596
Real estate, renting, and business activities151167184197226
Communities, social, and personal services366389418436453
Others1320171813
Population3,6123,7373,8663,8944,018
(Percentage change)
Total labor force3.04.13.02.310.9
Total employment2.74.72.10.911.1
Manufacturing-1.61.9-2.4-2.29.9
Construction1.09.74.1-0.5109.6
Services4.34.73.71.82.3
Population4.23.53.40.73.2
(In percent)
Unemployment rate (percent of the labor force)
Not seasonally adjusted3.02.43.24.64.4
Seasonally adjusted2.21.82.43.63.5
Labor force (percent of the population)49.950.250.050.754.6
Sources: Data provided by the Singapore authorities.
Sources: Data provided by the Singapore authorities.
Table 9.Singapore: Consumer Price Index, 1996–2001(Percentage change over corresponding period of previous year)
20002001
Weights

(1997/98)
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
All items1001.42.0-0.30.01.31.10.81.52.01.7
Food282.12.00.20.90.51.80.30.00.10.4
Clothing40.50.7-1.3-1.9-0.8-2.7-2.4-0.22.21.0
Housing230.52.31.9-1.02.20.11.12.94.03.8
Transport and communication180.43.9-4.9-0.62.13.41.92.01.2-0.3
Education and stationary73.01.53.11.51.30.00.82.02.22.3
Health32.33.74.30.61.50.40.21.22.73.6
Miscellaneous171.80.2-1.10.81.50.90.91.52.82.8
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 10.Singapore: Domestic Supply and Property Price Index, 1996–2001(Percentage change over corresponding period of previous year)
20002001
Weights19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
DSPI: all items1000-3.0-4.0-3.22.110.111.710.410.67.81.9
Food411.91.12.10.2-2.01.0-2.5-3.0-3.3-2.8
Beverages and tobacco101.70.13.5-0.80.6-0.9-0.41.81.85.1
Crude materials132.0-1.2-9.2-8.53.30.65.04.03.52.5
Mineral fuels21212.01.2-21.531.155.8103.662.748.631.1-1.5
Animal and vegetable oils7-8.4-0.214.7-9.0-15.3-20.2-15.2-10.1-14.9-16.4
Chemicals and chemical products75-5.6-1.3-1.83.06.07.47.76.52.81.0
Manufactured goods146-1.6-1.9-0.9-4.42.20.62.32.92.91.3
Machinery and transport equipment390-6.8-7.20.7-2.40.9-2.20.92.72.44.6
Miscellaneous manufactures106-3.8-1.9-0.7-1.00.3-0.1-0.40.90.7-0.1
Property prices
Private residential11.4-8.8-26.32.513.031.219.17.1-1.0-7.9
Industrial space21.40.6-24.0-20.213.7-0.115.422.917.516.4
Office space5.4-8.7-20.3-20.725.013.627.031.727.69.4
Shop space4.2-8.0-16.4-18.89.1-1.66.616.715.313.3
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 11.Singapore: Foreign Direct Investment Inflows by Industry, 1994–991/
19941995199619971998
(In millions of Singapore dollars)
Total inflows11,8389,66212,21815,64613,508
Agriculture and fishing-20127-8
Quarrying4-4-10-613
Manufacturing4,7253,4832,4415,8772,513
Construction13335842164384
Commerce2,3482361,1121,7744,255
Transport and communications563120459641885
Financial and business services4,1675,4418,0727,2155,473
Other services-992991-26-7
(Percentage change over previous year)
Total inflows93.9-18.426.528.1-13.7
Sources: Singapore Department of Statistics.

FDI inflows are equal to the change in the inward FDI stock.

Sources: Singapore Department of Statistics.

FDI inflows are equal to the change in the inward FDI stock.

Table 12.Singapore: Government Budget, 1997/98–2001/021/(In millions of Singapore dollars)
2000/012000/02
1997/981998/991999/00BudgetEstimatesBudget
Total revenue52,21841,36042,60145,45348,49049,181
Current revenue32,95632,71737,13538,06141,07042,054
Tax revenue23,01121,55122,62323,24825,95928,332
Investment income 2/3,7754,8066,4909,3659,2948,639
Other nontax revenue6,1706,3608,0225,4485,8175,083
Capital receipts19,2628,6435,4667,3927,4207,127
Total expenditure and net lending38,09239,11234,31642,04233,81734,660
Current expenditure 3/15,62115,95016,35517,15620,93221,027
Operating expenditure14,08014,65114,86816,09518,51418,656
Debt servicing992990838629532555
Agency fees on land sales80108554355
Expenses on investment182247259377798762
Transfer payments2875238201,0451,000
Development expenditure and net lending22,47123,16217,96124,88612,88513,633
Development expenditure8,96312,28210,21112,9019,4299,399
Net lending13,50810,8807,75011,9853,4564,235
Fund transfers60003000800850
Overall surplus/deficit (-)13,5262,2487,9853,41113,87413,671
Sources: Data provided by the Singapore authorities.

Fiscal year runs from April 1 through March 31.

Investment Income has been renamed as Investment and Interest Income from FY2000. This includes ‘interest on loan’ which was previously part of ‘Other nontax revenue’.

Includes agency fees on land sales and expenses on investment.

Sources: Data provided by the Singapore authorities.

Fiscal year runs from April 1 through March 31.

Investment Income has been renamed as Investment and Interest Income from FY2000. This includes ‘interest on loan’ which was previously part of ‘Other nontax revenue’.

Includes agency fees on land sales and expenses on investment.

Table 13.Singapore: Government Revenue, 1997/98–2001/021/(In millions of Singapore dollars)
2000/012000/02
1997/981998/991999/00BudgetEstimatesBudget
Total revenue52,21841,36142,60145,45348,49049,181
Current revenue32,95632,71837,13538,06141,07042,054
Tax revenue23,01121,55222,62323,24825,95928,332
Taxes on net income and profits 2/9,4949,53210,07210,45012,40013,950
Statutory boards’ contributions7021,8001,6768111,192814
Taxes on assets2,3361,5291,3141,7831,6092,120
Real estate2,2761,4901,2461,7331,5492,060
Death and gift taxes593968506060
Taxes on goods and services8,0647,0187,2747,7108,2818,612
Goods and services tax1,9271,6571,9951,9002,2002400
Selective excises on goods906847699753730726
Petroleum products607538467520500496
Tobacco13114180889393
Liquor168168152145138138
Selective taxes on services1,3861,3871,5131,6111,6681,792
Entertainment duty5455910
Betting and gambling taxes1,2961,2721,3731,44714951610
Tax on public utility and telephone bills86111135159164172
Motor vehicle taxes1,7431,2051,7191,94325512563
Other taxes on goods and services2,1031,9221,3491,50311321131
Import duties7267208758941,1071,136
Petroleum products000000
Tobacco263272315325401426
Liquor180174191202194198
Motor vehicles281270364363506507
Other445556
Stamp duties1,6889531,4131,6001,3701,700
Nontax revenue9,94511,16614,51114,81415,11113,722
Fees and charges4,0003,1524,5645,3965,7185,000
Investment income 3/3,7754,8066,4909,3659,2948,639
Other 4/2,1703,2083,458539983
Capital revenue 5/19,2628,6435,4667,3927,4207,127
Sources: Data provided by the Singapore authorities.

Fiscal year runs from April 1 through March 31.

The breakdown into corporate and individual income tax is estimated to be 70 percent and 30 percent, respectively.

Investment Income have been renamed as Investment and Interest Income from FY2000.

Interest earning from developmental loans have been classified as part of Investment and Interest Income with effect from FY2000.

Sale of government property.

Sources: Data provided by the Singapore authorities.

Fiscal year runs from April 1 through March 31.

The breakdown into corporate and individual income tax is estimated to be 70 percent and 30 percent, respectively.

Investment Income have been renamed as Investment and Interest Income from FY2000.

Interest earning from developmental loans have been classified as part of Investment and Interest Income with effect from FY2000.

Sale of government property.

Table 14.Singapore: Government Expenditure, 1997/98–2001/021/(In millions of Singapore dollars)
2000/012000/02
1997/981998/991999/00BudgetEstimatesBudget
Total expenditure and net lending38,09239,11234,31642,04233,81734,660
Current expenditure15,62115,95016,35517,15620,93221,027
Manpower (including defense personnel)3,0632,8962,8723,3183,4923,856
Pensions000000
Defense outlays (military expenditure)6,0076,4096,5796,4806,5087,030
Other purchases of goods and services1,5801,8061,8912,3382,2662,423
Debt servicing992990838629532555
Subsidies and transfers 2/3,4303,5403,5263,9596,2485,347
Agency fees on land sales80108554355
Expenses on investment182247259377798762
Transfer payments2875238201,0451,000
3,540
Development expenditure8,96312,28210,21112,9019,4299,399
Acquisition of fixed capital assets and purchases of land and intangible assets5,3266,9816,3697,6815,9025,845
Capital transfers 3/3,6375,3013,8425,2203,5273,554
Net lending13,50810,8807,75011,9853,4564,235
Loans to statutory boards16,66914,38311,93816,8809,4088,644
Repayments by statutory boards-3,161-3,503-4,188-4,895-5,952-4,409
Memorandum item:
Fund transfers 4/60003000800850
Sources: Data provided by the Singapore authorities.

The fiscal year runs from April 1 through March 31.

Excludes internal transfers to the Sinking and Development Funds. Includes grants (mainly to educational institutions, statutory boards, and government-owned companies), subventions to local and international organizations, and social transfers.

Mainly housing subsidies paid to the HDB for the difference between the market and required prices for public housing. Includes capital outlays on the MRT and capital grants to universities, etc.

Comprises transfers to the Edusave Endowment Fund, Medical Endowment Fund, Lifelong Learning Endowment Fund and Eldercare Fund.

Sources: Data provided by the Singapore authorities.

The fiscal year runs from April 1 through March 31.

Excludes internal transfers to the Sinking and Development Funds. Includes grants (mainly to educational institutions, statutory boards, and government-owned companies), subventions to local and international organizations, and social transfers.

Mainly housing subsidies paid to the HDB for the difference between the market and required prices for public housing. Includes capital outlays on the MRT and capital grants to universities, etc.

Comprises transfers to the Edusave Endowment Fund, Medical Endowment Fund, Lifelong Learning Endowment Fund and Eldercare Fund.

Table 15.Singapore: Government Expenditure and Net Lending, Functional Classification, 1997/98–2001/021/(In millions of Singapore dollars)
2000/012000/02
1997/981998/991999/00BudgetEstimatesBudget
Education4,4504,8534,8575,9965,8016,280
Current expenditure3,3483,1673,2573,9444,2894890
Capital expenditure1,1021,6861,6012,0521,5121390
Health1,1701,2431,0891,2541,2241,589
Current expenditure8969929361,0241,0861460
Capital expenditure274251153230138129
Other social and community services2,7724,6154,6054,3033,9414,293
Current expenditure1,2361,2741,2171,1471,3291482
Capital expenditure1,9303,3413,3883,1562,6122811
Economic services 2/4,6595,3813,7475,7776,1984,220
Current expenditure7088938651,0942,9161023
Capital expenditure3,5654,4882,8824,6833,2823197
Internal security and defense8,4109,3089,3039,8429,63510,257
Current expenditure7,2357,6617,9017,9898,0458869
Capital expenditure1,3251,6471,4031,8531,5901388
General administration 3/1,5821,5341,4781,8231,1431,415
Current expenditure658664692896849931
Capital expenditure767870786926294484
Unallocable, including interest payments 4/1,5411,2991,4871,0612,4182,371
Total current expenditure15,62115,95116,35417,15520,93221,027
Total capital expenditure8,96312,28310,21212,9019,4289,399
Net lending13,50810,8807,75011,9853,4564,235
Loans to statutory boards 5/16,66914,38311,93816,8809,4088,644
Repayments by statutory boards-3,161-3,503-4,188-4,895-5,952-4,409
Total government expenditure and net lending38,09239,11334,31642,04133,81634,660
Sources: Data provided by the Singapore authorities.

Fiscal year runs from April 1 through March 31.

Excludes loans to statutory boards and public enterprises.

Excludes internal transfers to the Sinking Fund and the Development Fund.

Also includes retirement pensions to former government employees, agency fees on land sales, and expenses on investment.

Includes lending to the HDB for the purchase of land.

Sources: Data provided by the Singapore authorities.

Fiscal year runs from April 1 through March 31.

Excludes loans to statutory boards and public enterprises.

Excludes internal transfers to the Sinking Fund and the Development Fund.

Also includes retirement pensions to former government employees, agency fees on land sales, and expenses on investment.

Includes lending to the HDB for the purchase of land.

Table 16.Singapore: Government Domestic Debt by Holders, 1996–20001/(Amount outstanding at end of period; in millions of Singapore dollars)
19961997199819992000
Government medium-term debt88,84195,452106,643113,617120,990
Government bonds67,85473,30680,66786,54891,011
Of which: Central provident fund51,62057,12059,62062,62060,620
Advance deposits 2/20,98722,14625,97627,06929,979
Treasury bills and deposits5,9906,9208,54012,16013,380
Commercial banks 3/5,9396,7388,07911,26511,024
Other511824618952,356
Total domestic debt94,831102,372115,183125,777134,370
(In percent of GDP)74.073.083.188.584.5
Sources: Data provided by the Singapore authorities.

Net outstanding at nominal value.

Deposits placed by the CPF in the government’s account with the MAS for future subscriptions to government securities.

Includes holdings of Development Bank of Singapore.

Sources: Data provided by the Singapore authorities.

Net outstanding at nominal value.

Deposits placed by the CPF in the government’s account with the MAS for future subscriptions to government securities.

Includes holdings of Development Bank of Singapore.

Table 17.Singapore: Monetary Survey Summary, 1996–2001
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
(In billions of Singapore dollars at end-period)
Net foreign assets90.392.8115.5131.0126.3132.3132.3126.2126.3128.6
Monetary authorities107.4119.3124.3127.1137.8126.8133.0134.5137.8138.9
Deposit money banks 1/-17.1-26.5-8.83.8-11.55.5-0.8-8.3-11.5-10.3
Domestic credit86.4103.3122.1121.8126.7123.9125.0121.3126.7132.0
Claims on private sector127.3143.4154.9150.2159.1149.4153.3154.7159.1162.9
Claims on government (net)-40.9-40.2-32.7-28.4-32.5-25.5-28.3-33.4-32.5-30.8
Other items (net)-64.7-72.6-76.9-78.3-82.1-83.5-85.6-81.0-82.1-84.2
M3148.5160.8173.6186.2182.9184.5183.3178.4182.9186.1
Broad money (M2)112.0123.4160.8174.5170.9172.7171.7166.6170.9176.4
Narrow money (M1)27.027.527.231.133.332.133.131.733.334.7
Quasi-money84.995.9133.5143.4137.6140.6138.7134.8137.6141.8
(Twelve-month change, in percent)
Net foreign assets4.82.924.413.4-3.510.18.3-6.4-3.5-2.8
Domestic credit17.019.518.3-0.34.00.70.54.34.06.6
Claims on private sector15.812.78.0-3.05.9-1.10.94.25.99.0
Claims on government (net)13.3-1.8-18.6-13.214.3-9.03.03.614.320.8
Narrow money (M1)6.71.7-1.014.26.910.611.610.36.98.0
Broad money (M2)9.810.330.28.5-2.05.62.3-2.2-2.02.2
(Twelve-month change, in percent of broad money at beginning of period)
Net foreign assets4.02.318.49.6-2.77.46.0-5.1-2.7-2.2
Domestic credit12.315.115.3-0.22.80.60.32.92.84.7
Other assets (net)-6.6-7.1-3.4-0.9-2.2-2.4-4.10.0-2.2-0.4
Memorandum items:
Income velocity of M2 2/1.11.10.90.80.90.90.91.01.00.9
Money multiplier 3/6.26.49.78.29.39.89.79.69.39.3
12-month change in M3 (percent)8.68.38.07.3-1.84.92.1-1.9-1.80.8
12-month change in reserve money (percent)6.75.6-13.328.6-13.72.25.82.5-13.77.3
Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Commercial banks and discount houses.

Ratio of annual GDP to average M2.

Ratio of M2 to reserve money.

Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Commercial banks and discount houses.

Ratio of annual GDP to average M2.

Ratio of M2 to reserve money.

Table 18.Singapore: Monetary Survey, 1996–2001(In millions of Singapore dollars)
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Net foreign assets90,25892,835115,512130,950126,315132,306132,262126,240126,315128,583
Monetary authorities107,403119,342124,335127,138137,816126,848133,049134,517137,816138,899
Foreign assets107,751119,617124,584128,457139,260128,159134,431135,953139,260140,327
Foreign liabilities3482752491,3191,4441,3111,3821,4361,4441,428
Deposit money banks-17,145-26,507-8,8233,812-11,5015,458-787-8,276-11,501-10,315
Foreign assets60,30278,68774,97593,05390,525106,863100,40994,93590,52597,762
Foreign liabilities77,447105,19483,79989,240102,026101,405101,196103,211102,026108,077
Net domestic assets21,84130,73645,27343,52444,58340,35739,45840,32244,58347,833
Domestic credit86,517103,378122,145121,826126,666123,859125,047121,284126,666132,012
Claims on private sector127,280143,417154,854150,212159,121149,395153,303154,653159,121162,856
Claims on government (net)-40,764-40,039-32,709-28,386-32,454-25,536-28,255-33,369-32,454-30,843
Monetary authorities-51,406-57,393-57,420-57,702-64,708-53,872-59,110-64,393-64,708-65,233
Claims on government148127641,2925,2502,2442,9724,0855,2505,557
Government deposits51,55457,52057,48458,99469,95856,11662,08268,47869,95870,789
Deposit money banks10,64217,35424,71129,31632,25328,33630,85531,02432,25334,389
Claims on government17,53818,88326,47730,94933,71930,67132,54732,45833,71936,355
Government deposits6,8961,5291,7661,6321,4652,3351,6921,4341,4651,965
Other items (net)-64,675-72,642-76,872-78,301-82,084-83,502-85,589-80,961-82,084-84,180
Monetary authorities-37,664-42,627-50,356-48,057-54,655-55,155-56,269-52,716-54,655-54,739
Deposit money banks-27,011-30,015-26,517-30,244-27,428-28,347-29,320-28,246-27,428-29,441
M3 1/148,495160,766173,581186,184182,913184,517183,263178,374182,913186,060
Broad money (M2)111,951123,443160,784174,474170,898172,663171,721166,563170,898176,416
Narrow money (M1)27,04027,51127,23931,10933,26232,07233,07031,72533,26234,652
Currency outside banks10,29310,70410,14611,31511,28910,96810,88110,93111,28911,357
Demand deposits16,74716,80717,09319,79421,97321,10422,18920,79421,97323,295
Quasi-money84,91195,933133,545143,365137,636140,591138,650134,838137,636141,763
Time, savings, and other deposits84,06695,299132,968142,816137,321140,047138,221134,492137,321141,418
NCDs in Singapore dollars845634577549315544429347315346
Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Adjusted for the acquisition of Post Office Savings Bank (POSB) by the DBS in November 1998.

Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Adjusted for the acquisition of Post Office Savings Bank (POSB) by the DBS in November 1998.

Table 19.Singapore: Assets and Liabilities of the Monetary Authority of Singapore, 1996–2001
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
(In millions of Singapore dollars)
Assets107,759119,625124,594128,470139,271128,172134,444135,965139,271140,337
Foreign assets (gross)107,751119,617124,584128,457139,260128,159134,431135,953139,260140,327
Claims on private sector (gross)881013111313121110
Liabilities107,759119,625124,594128,470139,271128,172134,444135,965139,271140,337
Reserve money18,18919,20016,64121,39518,47117,69417,68117,37318,47118,985
Currency outside banks 1/10,29310,70410,14611,31511,29810,96810,88110,93111,29811,357
Currency and deposits of banks7,8968,4966,49510,0807,1736,7266,8006,4427,1737,628
Foreign liabilities3482752491,3191,4441,3111,3821,4361,4441,428
Government deposits51,55457,52057,48458,99469,95856,11662,08268,47869,95870,789
Other liabilities (net)37,66842,62950,22046,76249,39853,05153,29948,67849,39849,135
(Change as percent of initial stock of reserve money)
Net foreign assets61.365.626.016.849.9-1.435.08.319.05.9
Government deposits41.632.8-0.29.151.2-13.533.736.28.54.5
Other items (net)12.927.339.5-20.812.329.41.4-26.14.1-1.4
Reserve money6.75.6-13.328.6-13.7-17.3-0.1-1.76.32.8
Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Excludes commemorative, numismatic, and bullion coins issued by the Board of Commissioners of Currency of Singapore.

Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Excludes commemorative, numismatic, and bullion coins issued by the Board of Commissioners of Currency of Singapore.

Table 20.Singapore: Assets and Liabilities of Commercial Banks, 1996–2001
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Assets252,723289,572309,975326,295344,006342,182344,589342,266344,006363,662
Reserves7,9078,5046,42910,0817,1806,8706,8056,4937,1807,583
Cash8118029982,5571,4899709289671,4891,038
Balances with the Monetary Authority7,0957,7025,4317,5245,6915,9015,8775,5265,6916,545
Foreign assets 1/60,30278,68774,97593,05390,525106,863100,40994,93590,52597,762
Claims on government17,53818,88326,47730,94933,71930,67132,54732,45833,71936,355
Claims on private sector 2/127,272143,409154,844150,199159,110149,382153,290154,641159,110162,846
Balances with local banks33,55530,22138,21629,45942,53637,52540,70541,66642,53642,880
Singapore dollars negotiated CDs held199213175163150163126123150123
Other assets 3/5,9519,6558,85812,39310,78710,70710,70811,95210,78616,115
Liabilities252,723289,572309,975326,295344,006342,182344,589342,266344,006363,662
Deposits of nonbanks100,813112,106150,638163,159159,609161,695160,839155,632159,609165,058
Demand deposits16,74716,80717,09319,79421,97321,10422,18920,79421,97323,295
Time and savings deposits 4/84,06695,299133,545143,365137,636140,591138,650134,838137,636141,763
Foreign liabilities 5/77,447105,19483,79989,240102,026101,405101,196103,211102,026108,077
Government deposits6,8961,5291,7661,6321,4652,3351,6921,4341,4651,965
Capital and reserves20,97723,71023,32425,31924,49225,80626,12526,18424,49226,431
Balances due to local banks34,32931,13429,77023,12434,33429,29933,06335,04334,33437,725
Singapore dollars negotiated CDs issued1,043846752712465707555470465123
Other liabilities 6/11,21815,05419,92723,11021,61520,93621,12020,29321,61524,283
Memorandum item: Annual percentage change in total assets/liabilities12.514.67.05.35.45.05.94.35.411.5
Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Includes amounts due from Asian Currency Units.

Includes bills refinanced by MAS. Excludes bills rediscounted between commercial banks.

Includes: Money at call with MAS; checks purchase payable in Singapore; Singapore interbranch balances; fixed assets in Singapore; and other domestic assets.

Excludes Singapore dollars NCDs. Data from 98 includes S$NCDs

Includes amounts due to ACUs and capital and reserves of foreign banks.

Includes: amounts borrowed from creditors in Singapore; bills payable in Singapore; import and export bills rediscounted with MAS; Singapore interbranch balances; and other domestic liabilities.

Sources: IMF, Economic Information System; and data provided by the Singapore authorities.

Includes amounts due from Asian Currency Units.

Includes bills refinanced by MAS. Excludes bills rediscounted between commercial banks.

Includes: Money at call with MAS; checks purchase payable in Singapore; Singapore interbranch balances; fixed assets in Singapore; and other domestic assets.

Excludes Singapore dollars NCDs. Data from 98 includes S$NCDs

Includes amounts due to ACUs and capital and reserves of foreign banks.

Includes: amounts borrowed from creditors in Singapore; bills payable in Singapore; import and export bills rediscounted with MAS; Singapore interbranch balances; and other domestic liabilities.

Table 21.Singapore: Interest Rate Structure, 1996–2001(In percent per annum; end of period)
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Commercial banks
Prime lending rate6.266.965.905.805.805.855.855.855.805.80
Fixed deposits (12 months)3.994.412.512.462.422.462.462.462.422.38
Finance companies
Loans for motor vehicles (3 years)5.717.956.995.415.195.325.185.255.195.21
Housing loans (15 years)6.817.177.316.156.156.176.226.226.156.30
Fixed deposits (12 months)3.984.402.752.802.742.792.862.882.742.30
Interbank rates
1-month3.136.501.503.002.752.192.442.502.752.38
3-month3.136.751.752.632.812.382.502.562.812.38
Commercial bills (3-month)2.753.751.501.382.732.252.632.572.732.31
Government securities
Treasury bills (3-month)1.401.201.150.402.481.952.202.352.481.99
Bonds (5-year)2.983.893.803.703.443.733.843.723.443.11
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 22.Singapore: Banks’ Loans and Advances to Nonbank Customers by Industry, 1996–2001
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Total126,988143,244151,641147,186154,042146,528150,250150,758154,042156,955
Agriculture, mining, and quarrying133188224191179213191172179188
Manufacturing12,24812,47212,24911,57511,62911,52312,26011,75111,62112,068
Building and construction 1/41,80449,17057,36958,59864,20758,28160,46162,44564,20765,247
General commerce23,93226,35021,54919,94918,96819,41419,08618,85518,96818,476
Transport, storage, and communication2,6193,5764,4603,7434,1243,7273,8823,8494,1244,351
Financial institutions19,44820,99722,72421,06320,86521,59922,23320,96520,86521,195
Professional and private individuals20,25622,77521,76621,59424,72722,37122,85523,80624,72226,311
Others6,5487,71711,30110,4729,3499,4009,2808,9159,3579,120
(Twelve-month change, in percent)
Total16.512.85.9-2.94.7-1.20.93.44.77.1
Agriculture, mining, and quarrying-16.641.319.2-14.4-6.68.4-12.3-17.3-6.6-11.4
Manufacturing11.31.8-1.8-5.50.5-5.34.47.30.44.7
Building and construction 1/22.217.616.72.19.61.45.97.49.612.0
General commerce10.610.1-18.2-7.4-4.9-6.9-5.1-5.1-4.9-4.8
Transport, storage, and communication20.236.524.7-16.110.2-16.4-12.0-1.410.216.7
Financial institutions15.28.08.2-7.3-0.90.9-0.42.4-0.9-1.9
Professional and private individuals19.912.4-4.4-0.814.54.96.210.914.517.6
Others8.917.846.4-7.3-10.7-10.0-19.4-16.9-10.6-3.0
Sources: CEIC database; and data provided by the Singapore authorities.

Includes building and building cooperative societies, building developers, real estate agents, and housing loans.

Sources: CEIC database; and data provided by the Singapore authorities.

Includes building and building cooperative societies, building developers, real estate agents, and housing loans.

Table 23.Singapore: Assets and Liabilities of Nonbank Financial Institutions, 1996–2001(In millions of Singapore dollars, at end of period)
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Finance companies
Total assets21,18922,21121,94220,74219,80121,30120,05020,07119,80116,366
Cash and balances with MAS827885414391382376363376382306
Deposits2,1661,9042,7222,7301,6653,0632,3211,7311,6651,974
Investments1,1391,2021,7051,6921,6801,6221,7071,6341,6801,332
Loans and advances16,76317,90016,77915,63615,79115,93915,38116,05315,79112,488
Other294320321294283302278277283266
Total liabilities21,18922,21121,94220,74219,80121,30120,05020,07119,80116,366
Capital and reserves3,0153,2693,3713,4083,1653,4583,3983,4853,1652,713
Deposits15,07215,61215,34514,32213,64614,82213,83813,51013,64611,592
Borrowings from individuals and institi1,3821,3981,1808999998388751,047999430
Other1,7211,9322,0462,1131,9922,1841,9392,0301,9921,631
Merchant banks 1/
Total assets7,4978,7128,5937,9007,5397,6637,3217,6777,5397,972
Due from banks5,3396,5546,7546,4555,9586,1045,7856,0955,9586,310
Loans and advances1,2471,090834676792698775763792804
Investments in securities and equities494513430450485536435494485553
Other416556575320304326326326304306
Total liabilities7,4978,7128,5937,9007,5397,6637,3217,6777,5397,972
Capital and reserves4,1054,8905,2554,8744,8034,7024,7784,9584,8035,034
Due to banks1,7202,0471,8562,0541,6802,0131,5661,7461,6801,812
Borrowings from non-bank customers1,1941,082786516563498548549563615
Other477694697456494450429425493512
Sources: CEIC database; and data provided by the Singapore authorities.

Excludes Asian Dollar Market operations.

Sources: CEIC database; and data provided by the Singapore authorities.

Excludes Asian Dollar Market operations.

Table 24.Singapore: Financial Operations of the Central Provident Fund, 1996–2000(In millions of Singapore dollars)
199619971998199920002000
Mar.Jun.Sep.Dec.
Excess of contributions over withdrawals4,0934,4182,39039-462431-1,019-75202
Contributions14,62315,87416,00012,82714,0944,2463,0253,2813,541
Withdrawals (net of refunds)10,53011,45613,61112,78814,5553,8164,0443,3563,339
Public housing3,0003,4604,7965,4285,4431,4331,4781,3621,170
Residential properties2,0592,3273,0394,1003,212784789854786
Reached 55 years of age 1/1,2051,0701,2861,1591,219276394249300
Leaving Singapore and Malaysia 2/31035139534730473867867
Death10911615115114538373535
Medisave scheme31633834934842110299119101
Others 3/3,5313,7943,5951,2563,8121,1111,162658881
Interest earnings from investments2,6032,8683,4803,3102,538630630638640
Interest credited to members’ balances2,4532,6933,2493,1052,379596596593594
Increase in members’ balances6,5327,0905,6193,1201,9011,022-427515791
Members’ balances, end-period72,56779,65785,27788,39790,29889,41988,99389,50790,298
Advance deposits with MAS 4/8,0766,3385,9685,5772,5781,458-6602,320-540
Holdings of government securities, end-period 5/51,62057,12059,62062,62062,62062,62062,62062,62062,620
Sources: CEIC database; and data provided by the Singapore authorities.

Includes first and subsequent withdrawals.

Includes Malaysians leaving Singapore permanently.

Excludes Government and Capping refunds, Self-Employed and Small Families Improvement Scheme refunds.

Deposits placed with MAS during the year excluding interest on bonds retained as deposits by MAS.

Excludes advance deposits with MAS.

Sources: CEIC database; and data provided by the Singapore authorities.

Includes first and subsequent withdrawals.

Includes Malaysians leaving Singapore permanently.

Excludes Government and Capping refunds, Self-Employed and Small Families Improvement Scheme refunds.

Deposits placed with MAS during the year excluding interest on bonds retained as deposits by MAS.

Excludes advance deposits with MAS.

Table 25.Singapore: Operations of Asian Currency Units, 1996–2001(In millions of U.S. dollars, at end of period)
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Total assets506,870557,194503,610480,399486,453474,613469,381471,268486,453484,696
Loans to nonbanks180,506173,286131,713110,59489,446100,87094,76293,29289,44684,913
Interbank funds278,743330,686330,193318,777338,488322,173319,791317,408338,488337,207
In Singapore22,35729,84625,93126,78231,22228,85329,22829,35231,22232,815
Inter-ACU40,23748,88340,69734,69831,51334,87335,37735,39931,51332,315
Outside Singapore216,149251,956263,566257,297275,754258,447255,186252,658275,754272,078
Other assets47,62253,22241,70451,02958,51951,57054,82860,56858,51962,576
Total liabilities506,870557,194503,610480,399486,453474,613469,381471,268486,453484,696
Deposits of nonbanks95,374113,683113,077121,320124,652123,017122,962124,322124,652123,381
Interbank funds389,470414,526365,479326,543321,650319,535312,349310,676321,650322,155
In Singapore25,25732,27220,74228,20027,97634,41135,81139,20727,97629,657
Inter-ACU40,24348,90540,69434,70231,51734,87435,37635,39931,51732,315
Outside Singapore323,969333,349304,043263,641262,157250,251241,163236,070262,157259,576
Other liabilities22,02728,98425,05432,53740,15132,06234,07036,27040,15139,161
Memorandum item: Annual percentage change in total assets/liabilities6.09.9-9.6-4.61.3-1.10.0-0.61.32.1
Sources: Data provided by the Singapore authorities.
Sources: Data provided by the Singapore authorities.
Table 26.Singapore: Stock Market Indicators, 1996–2001(End-period data)
1996199719981999200020002001
Mar.Jun.Sep.Dec.Mar.
Strait Times Index1,9921,5081,3932,4801,9272,1332,0381,9971,9271,674
(Annual percentage change)3.9-24.3-7.678.0-22.340.5-6.0-1.2-22.3-21.5
Number of listed companies317356371408480418445475480487
Mainboard266294307327388334352385388390
SESDAQ51626481928493909297
Turnover 1/88,855114,31198,696196,914171,02853,68341,17737,26138,90634,995
(In percent of market capitalization)18.023.127.933.131.89.37.26.77.27.0
Market capitalization493,094494,179354,112595,398538,331574,496569,576558,157538,331497,479
Mainboard255,862329,268263,168438,746389,516416,167414,451405,041389,516344,055
SESDAQ4,2893,1662,4528,4243,9867,3886,9164,8393,9863,504
CLOB232,943161,74588,492148,228144,828150,941148,209148,276144,828149,920
Sources: CEIC database; and data provided by the Singapore authorities.

Includes SESDAQ.

Sources: CEIC database; and data provided by the Singapore authorities.

Includes SESDAQ.

Table 27.Singapore: Balance of Payments Summary in Singapore Dollars, 1996–2001(In millions of Singapore dollars)
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Current Account Balance18,08026,61834,03136,86637,5768,9758,77110,4219,4089,332
Goods Balance3,1361,66024,78819,02319,6534,7843,7305,3605,7795,620
Exports of Goods177,680186,708185,085195,910239,51252,09257,19564,21166,01457,637
Imports of Goods174,543185,048160,297176,888219,85947,30953,46558,85160,23452,017
Services Balance14,41717,0932,5558,5699,7102,0402,6933,0921,8862,059
Exports of Services42,24145,27632,04940,65446,61610,34111,77912,50711,98911,244
Imports of Services27,82428,18329,49432,08436,9068,3019,0879,41510,1039,185
Income Balance2,0319,6008,57911,35810,5552,6642,8862,5422,4642,210
Income Receipts17,67320,62921,70525,38226,2956,2486,8336,6156,5985,803
Income Payments15,64111,02913,12614,02415,7403,5853,9474,0734,1353,593
Current Transfers (Net)-1,505-1,736-1,837-1,973-2,342-512-537-572-721-557
Capital Flows (including errors and omissions)-7,673-14,762-29,050-29,544-25,741-11,146-2,912-6,028-5,655-8,353
Capital and Financial Account Balance-6,999-16,555-36,884-31,308-19,932-9,14027949-11,120-7,675
Capital Account (Net)-196-257-378-324-281-71-79-71-59-66
Financial Account (Net)-6,803-16,298-36,506-30,984-19,651-9,069358120-11,061-7,609
Net Errors and Omissions-6741,7937,8341,764-5,809-2,006-3,191-6,0765,465-678
Overall Balance10,40611,8564,9827,32211,835-2,1715,8604,3943,753979
Official reserves (end-period stock)107,751119,617124,584128,457139,260128,159134,431135,953139,260140,327
(In months of imports of goods and services)6.46.77.97.46.59.28.68.07.99.2
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 28.Singapore: Balance of Payments Summary in U.S. Dollars, 1996–2001(In millions of U.S. dollars)
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Current Account Balance12,82117,92720,33421,75021,7955,2915,0946,0145,3915,332
Goods Balance2,2241,11814,81111,22311,3992,8202,1663,0933,3123,211
Exports of Goods126,005125,746110,591115,584138,92530,70933,21737,05637,82732,933
Imports of Goods123,781124,62895,780104,361127,52527,88931,05133,96234,51529,722
Services Balance10,22411,5121,5275,0565,6321,2031,5641,7841,0811,177
Exports of Services29,95630,49319,14923,98527,0396,0966,8417,2186,8706,425
Imports of Services19,73218,98117,62318,92921,4074,8945,2775,4345,7895,248
Income Balance1,4416,4655,1266,7016,1221,5701,6761,4671,4121,263
Income Receipts12,53313,89312,96914,97515,2523,6843,9683,8173,7813,316
Income Payments11,0927,4287,8438,2749,1302,1132,2922,3512,3692,053
Current Transfers (Net)-1,067-1,169-1,098-1,164-1,358-302-312-330-413-318
Capital Flows (including errors and omissions)-5,442-9,942-17,358-17,430-14,931-6,571-1,691-3,478-3,241-4,773
Capital and Financial Account Balance-4,964-11,149-22,038-18,471-11,561-5,38816228-6,372-4,385
Capital Account (Net)-139-173-226-191-163-42-46-41-34-38
Financial Account (Net)-4,825-10,976-21,813-18,280-11,398-5,34620869-6,338-4,348
Net Errors and Omissions-4781,2074,6811,041-3,369-1,183-1,853-3,5073,131-387
Overall balance7,3807,9852,9774,3206,865-1,2803,4032,5362,150559
Memorandum item:
Singapore dollar/U.S. dollar (period average)1.4101.4851.6741.6951.7241.6961.7221.7331.7451.750
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 29.Singapore: Domestic Exports by Commodity, 1996–2001(In millions of Singapore dollars)
20002001
19961997199819992000Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Total103,589107,535105,918116,325135,93930,11432,39136,49936,93432,032
Mineral fuels (oil)16,55115,91113,47315,14322,8674,9025,2875,7686,9115,920
Oil bunkers2,8783,1782,9123,3885,5591,0901,2541,5831,6321,480
Others13,67212,73310,56111,75417,3083,8124,0334,1855,2784,440
Non-oil87,03891,62492,445101,182113,07225,21327,10430,73230,02426,113
Food1,2591,2751,2211,2381,346318313358357315
Beverages and Tobacco4944073942612605872636757
Crude materials495562549498650148163176162156
Animal and vegetable oils2993163333462837469667367
Chemicals and chemical products5,6266,6507,16310,39112,3222,2902,5812,8652,9823,065
Manufactured goods2,8442,9352,5632,6963,078689770812807684
Machinery and transport equipment70,28872,84572,46976,36784,24818,60819,79023,01522,83519,152
Office machines37,41539,45339,91640,60138,3908,7579,01710,09710,5198,738
Electrical machinery2,0082,0791,9901,7372,434507584707636541
Electrical circuit apparatus2,2112,3372,3882,7832,976645718810803671
Radio and television and parts2,8693,1302,7622,3762,559527620712700
Electronic components and parts15,11116,87717,10920,00027,9046,3376,4368,1376,9945,693
Others10,6758,9708,3048,8719,9861,8352,4152,5523,1843,509
Miscellaneous manufactures5,1766,0177,0058,52310,0662,3152,5472,6702,5342,426
Others557616787864819187205222205192
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 30.Singapore: Exports of Electronics, 1996–2000(In millions of Singapore dollars)
199619971998199920002000
Qtr 1Qtr 2Qtr 3Qtr 4
Total exports of electronics94,25799,33499,811106,687132,74128,52930,79036,58136,841
United States27,11127,98028,97829,33232,3246,9947,2228,8959,214
Malaysia13,82013,81913,66016,04422,9074,6335,3326,6806,261
European Union (15)17,02119,34420,94219,83622,0684,9564,7335,7166,662
Japan7,9227,0776,5627,2028,9031,9392,1142,2702,580
Others28,38331,11429,66934,27346,53910,00711,38913,02012,124
Domestic exports61,87263,99463,64767,55874,39316,86417,43320,55719,539
United States22,30223,10323,57823,71523,8385,4995,5816,6066,152
Malaysia6,6986,8136,4287,0718,5721,8481,9142,5482,261
European Union (15)13,00414,60615,87915,15214,6713,3903,1753,8724,234
Japan5,7184,4143,9354,4045,4081,1521,2311,4351,590
Others14,15015,05813,82717,21621,9044,9755,5326,0965,302
Re-exports32,38535,34136,16439,12958,34811,66513,35716,02417,302
United States4,8094,8775,4005,6178,4861,4951,6412,2893,062
Malaysia7,1227,0067,2328,97314,3352,7853,4184,1324,000
European Union (15)4,0174,7385,0644,6847,3971,5661,5581,8442,428
Japan2,2042,6632,6272,7983,495787883835990
Others14,23316,05715,84117,05724,6355,0325,8576,9246,822
Domestic exports61,87263,99463,64767,55874,39316,86417,43320,55719,539
Electronic components15,11116,87717,10920,00027,9046,3376,4368,1376,994
Disk drives16,55717,71318,43617,08915,0973,3243,7313,9894,054
PCs3,7643,2092,8912,4171,590416402413359
Others26,44026,19525,21128,05229,8026,7876,8648,0188,132
Sources: Data provided by the Singapore authorities.
Sources: Data provided by the Singapore authorities.
Table 31.Singapore: Exports Under the Generalized System of Preferences (GSP) by Country of Destination, 1996–2000(In millions of Singapore dollars)
199619971998199920002000
Qtr 1Qtr 2Qtr 3Qtr 4
Total1,5671,170617352126841048282
European Union1,0157402981299120
Japan3533122392746058836667
Canada424242484313141110
Other157763818144635
Sources: Singapore Trade Development Board.
Sources: Singapore Trade Development Board.
Table 32.Singapore: Direction of Exports, 1996–20001/2/
199619971998199920002000
Qtr 1Qtr 2Qtr 3Qtr 4
(In millions of Singapore dollars)
Total176,272185,613183,763194,290237,82651,67156,65863,87565,623
Southeast Asia51,62351,59644,00550,19365,13914,00915,64217,69317,525
Malaysia31,74332,40527,99932,16543,2218,97210,26612,29311,690
Thailand10,0068,5337,0378,53810,1232,2842,5322,6652,641
Philippines3,2384,3824,1204,7955,8401,4581,4401,4871,455
Brunei2,4122,0671,028818838179217220222
Other4,2244,2103,8213,8805,1511,1161,1871,0281,517
Northeast Asia47,38551,03546,65851,65968,77814,82017,02818,27418,656
Japan14,45513,12512,09014,42317,9543,9764,3474,4755,156
Hong Kong, SAR15,68717,84815,41814,91418,7064,1684,6474,8625,029
Taiwan Province of China6,8708,3687,9289,47714,1962,8063,6964,1963,498
China4,7846,0386,7946,6439,2871,8032,2392,5572,687
Korea, Republic of5,3535,4834,2916,0278,4802,0242,0632,1462,247
Other23617413717515644363739
South Asia5,0675,3856,9267,0417,9651,9191,8502,1592,037
Middle East2,8513,0293,5893,1413,8519388971,0151,000
Oceania5,3765,7676,5826,9217,5091,7581,9171,9121,922
Western Europe24,23927,17332,00330,92934,0427,5147,6898,8889,950
Germany5,4135,3785,5645,5227,3781,6531,8041,7812,140
United Kingdom4,9846,1906,2367,2476,1291,3371,2441,7751,773
France3,4673,6483,7413,7093,685922884924955
Netherlands4,0734,5586,3316,5367,0521,6311,3801,8062,234
Italy716771861734848189199219241
Switzerland5643731,88636590371231285315
Other5,0226,2557,3846,8168,0501,7101,9482,1002,292
North America33,08434,76137,50338,11442,1339,1549,43711,56111,981
United States32,44634,11836,52137,21641,1898,9489,22911,28711,725
Other638643982898944207208274256
Rest of the world6,6466,8676,4986,2928,4091,5592,1972,3732,553
(In percent of total exports)
Southeast Asia29.327.823.925.827.427.127.627.726.7
Northeast Asia26.927.525.426.628.928.730.128.628.4
South Asia2.92.93.83.63.33.73.33.43.1
Middle East1.61.62.01.61.61.81.61.61.5
Oceania3.03.13.63.63.23.43.43.02.9
Western Europe13.814.617.415.914.314.513.613.915.2
North America18.818.720.419.617.717.716.718.118.3
Rest of the world3.83.73.53.23.53.03.93.73.9
Sources: CEIC database; and data provided by the Singapore authorities.

Grouping of countries conforms to official Singapore presentation.

The term “country,” as used in this table, does not in all cases refer to a territorial entity (that is, a state) as understood by internation and practice; term also covers some territorial entities that are not states, but for which data are maintained and provided internationally on a separate and independent basis.

Sources: CEIC database; and data provided by the Singapore authorities.

Grouping of countries conforms to official Singapore presentation.

The term “country,” as used in this table, does not in all cases refer to a territorial entity (that is, a state) as understood by internation and practice; term also covers some territorial entities that are not states, but for which data are maintained and provided internationally on a separate and independent basis.

Table 33.Singapore: Direction of Imports, 1996–20001/2/
199619971998199920002000
Qtr 1Qtr 2Qtr 3Qtr 4
(In millions of Singapore dollars)
Total185,183196,605169,863188,141232,17550,12556,51562,10863,426
Southeast Asia41,15344,00139,67744,67757,39112,25813,69115,51915,923
Malaysia27,80829,54826,25229,28639,4248,3119,46810,81710,828
Thailand10,11710,0808,1198,89010,0102,1772,3582,6172,857
Philippines1,9602,9544,0024,9755,7961,2421,3771,5191,658
Other1,2681,4191,3041,5272,161528489565580
Northeast Asia59,59263,06952,93160,99276,92416388189602089320683
Japan33,61734,56428,43531,32940,0088,9059,89610,73310,475
Hong Kong, SAR5,9225,7804,7595,4016,0631,3211,4271,6701,645
Taiwan Province of China7,4218,2086,5147,54010,2991,9562,3782,8863,079
China6,2598,4478,1239,65012,2812,4703,0973,3303,384
Korea, Republic of6,3626,0565,0887,0648,3151,7322,1672,2712,145
Other1214139-423-43-45
South Asia1,6581,7941,2421,5222,203465494612633
Middle East14,69015,40711,21213,33119,4514060517745845630
Oceania3,2313,1112,5482,9104,4828301,0981,2561,298
Western Europe30,08330,95926,33127,92931,6017211766782658459
Germany6,7606,7235,8436,1127,3081,5451,8321,9671,964
United Kingdom5,0675,5134,6364,6234,7241,2231,0941,2271,180
France5,2505,4314,8894,3973,7748579359661,016
Italy3,1882,9031,8402,0262,869650642860716
Other9,81910,3899,12310,77112,9272,9363,1643,2453,583
North America31,21734,24532,21032,91435,8048,0778,3149,8129,602
United States30,25633,01731,25332,04534,7107,8218,0389,5509,301
Other9611,2289578691,095256276262301
Rest of the world3,5594,0193,7133,8674,3198361,1151,1671,199
(In percent of total imports)
Southeast Asia22.222.423.423.724.724.524.225.025.1
Northeast Asia32.232.131.232.433.132.733.533.632.6
South Asia0.90.90.70.80.90.90.91.01.0
Middle East7.97.86.67.18.48.19.27.48.9
Oceania1.71.61.51.51.91.71.92.02.0
Western Europe16.215.715.514.813.614.413.613.313.3
North America16.917.419.017.515.416.114.715.815.1
Rest of the world1.92.02.22.11.91.72.01.91.9
Sources: CEIC database; and data provided by the Singapore authorities.

Grouping of countries conforms to official Singapore presentation.

The term “country,” as used in this table, does not in all cases refer to a territorial entity (that is, a state) as understood by internati and practices; the term also covers some territorial entities that are not states, but for which data are maintained and provided internatio on a separate and independent basis.

Sources: CEIC database; and data provided by the Singapore authorities.

Grouping of countries conforms to official Singapore presentation.

The term “country,” as used in this table, does not in all cases refer to a territorial entity (that is, a state) as understood by internati and practices; the term also covers some territorial entities that are not states, but for which data are maintained and provided internatio on a separate and independent basis.

Table 34.Singapore: Structure of Imports, 1996–2000(In millions of Singapore dollars)
199619971998199920002000
Qtr 1Qtr 2Qtr 3Qtr 4
Total imports185,183196,605169,863188,141232,17550,12556,51562,10863,426
Retained imports126,023133,354109,145124,203147,36332,12536,36439,06639,808
Food products3,7763,8513,3423,8114,0009509701,0391,041
Beverages and tobacco63360137455151486108155165
Crude materials (inedible)9801,0027448861,198238246335379
Mineral fuels17,15618,35613,50516,90127,8125,5867,2906,6268,310
Animal and vegetable oils32535439639030178807370
Chemicals7,5107,6416,5317,2588,6541,8752,1532,3522,274
Manufactured goods12,80813,98610,89110,76911,7772,6692,9803,0643,064
Iron and steel3,0083,4552,6542,2042,387594604589600
Metal manufactures2,4382,7522,5942,6482,652601648696707
Machinery and transport equipment68,37371,57661,49968,75677,14016,66718,36521,48420,624
Power generators2,7102,8332,7942,8152,961636790778757
Telecommunication apparatus4,5734,8053,3544,1985,3421,1301,4501,4021,360
Motor vehicles2,4672,3361,5321,9823,540785911953891
Ships and aircraft6,8636,7485,8625,4652,3337113621,020240
Miscellaneous manufactures13,14714,07210,69413,23414,3353,6043,7333,5173,481
Others1,3151,9151,1691,6471,632372439421400
Entrepot imports59,16063,25160,71863,93884,81218,00020,15123,04223,618
Sources: Data provided by the Singapore authorities.
Sources: Data provided by the Singapore authorities.
Table 35.Singapore: External Trade—Volumes and Values, 1996–2001
1996199719981999200020002001
Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
(In millions of Singapore dollars)
Volume (at 1995 prices)
Exports184,521205,923205,353216,463252,80956,00460,44567,56168,79860,503
Domestic exports107,754119,806120,637130,360143,68932,32534,54938,45038,36434,226
Oil14,23814,24815,45914,01813,1823,0883,2533,1203,7213,680
Non-Oil93,516105,558105,177116,342130,50729,23731,29635,33034,64430,547
Re-exports76,76786,11784,71686,103109,12023,67925,89629,11130,43426,276
Imports193,247213,049185,588203,247232,76552,10356,45461,71862,49054,192
Value (at current prices)
Exports176,272185,613183,763194,290237,82651,67156,65863,87565,62357,152
Domestic exports103,589107,535105,918116,325135,93930,11432,39136,49936,93432,032
Oil16,55115,91113,47315,14322,8674,9025,2875,7686,9115,920
Non-Oil87,03891,62492,445101,182113,07225,21327,10430,73230,02426,113
Re-exports72,68378,07777,84677,965101,88821,55724,26727,37528,68925,119
Imports185,183196,605169,863188,141232,17550,12556,51562,10863,42654,682
(Index 1995 = 100)
Export unit value 1/95.590.189.589.894.192.393.794.595.494.5
Import unit value 1/95.892.391.592.699.796.2100.1100.6101.5100.9
Implicit terms of trade99.797.797.897.094.395.993.694.094.093.6
(Annual percntage change)
Volume (at 1995 prices)
Exports10.211.6-0.35.416.817.413.122.314.58.0
Domestic exports9.311.20.78.110.210.76.916.86.85.9
Oil3.60.18.5-9.3-6.0-21.0-14.84.912.119.1
Non-Oil10.312.9-0.410.612.215.69.718.06.34.5
Re-exports11.312.2-1.61.626.727.922.830.326.011.0
Imports9.610.2-12.99.514.516.813.214.913.54.0
Value (at current prices)
Exports5.25.3-1.05.722.422.818.728.419.910.6
Domestic exports5.23.8-1.59.816.919.413.422.912.46.4
Oil20.6-3.9-15.312.451.053.542.659.649.320.8
Non-Oil2.75.30.99.511.814.59.117.86.33.6
Re-exports5.37.4-0.30.230.727.926.536.631.116.5
Imports5.06.2-13.610.823.424.622.925.121.49.1
Export unit value-4.5-5.6-0.70.34.84.74.95.04.62.4
Import unit value-4.2-3.7-0.81.17.86.78.68.96.94.9
Implicit terms of trade-0.3-2.00.1-0.8-2.7-1.9-3.4-3.5-2.1-2.4
Sources: CEIC database; and data provided by the Singapore authorities.

Calculated as residuals.

Sources: CEIC database; and data provided by the Singapore authorities.

Calculated as residuals.

Table 36.Singapore: Disaggregated Trade Data, 1996–2001 1/2/(In millions of Singapore dollars)
1996199719981999200020002001
Q1Q2Q3Q4Q1
Total exports
Value176,272185,613183,763194,290237,82651,67156,65863,87565,62357,152
Price95.690.289.289.895.093.494.096.396.192.5
Volume110.0122.8123.0129.2149.5132.0143.9158.3163.1147.5
Mineral fuels (Oil)
Value16,72816,21913,63915,33523,0624,9585,3495,8096,9475,933
Price116.7112.087.5110.0173.4159.4162.6185.1186.3160.9
Volume103.5104.5112.5100.696.089.895.090.6107.6106.4
Manufactured goods
Value10,07210,4028,3558,4549,1362,0752,4182,3512,2921,999
Price98.398.8100.097.097.997.398.398.098.197.5
Volume96.699.278.782.187.980.392.790.488.177.3
Machinery and equipment
Value116,262122,474122,120128,810158,83233,82537,29043,22644,49237,803
Price92.584.685.784.282.782.482.583.282.680.9
Volume114.2131.6129.6139.1174.6149.2164.4188.9195.9170.0
Other exports
Value33,21036,51839,65041,69046,79610,81411,60112,48911,89311,416
Price 3/95.488.086.287.292.690.991.394.494.089.7
Volume105.4125.6139.2144.7152.9144.0153.9160.2153.2154.0
Total Imports
Value185,183196,605169,863188,141232,17550,12556,51562,10863,42654,682
Price96.192.892.093.5101.998.5101.6103.3104.2101.7
Volume109.3120.1104.7114.1129.2115.5126.2136.4138.1122.0
Mineral fuels (Oil)
Value17,31318,63513,64717,07527,9875,6367,3466,6638,3436,688
Price110.0112.987.0119.1189.1171.1180.8198.1206.4166.8
Volume110.9116.2110.4100.9104.292.8114.494.7113.8112.9
Nonfuel imports
Value167,870177,970156,216171,066204,18844,48949,17055,44555,08447,995
Price 3/94.790.992.591.093.591.593.994.294.495.4
Volume109.3120.8104.2115.9134.7120.0129.1145.2144.0124.1
Sources: CEIC database; and data provided by the Singapore authorities.

Values in millions of Singapore dollars, volumes and prices in indices, 1995 = 100.

Volumes in this table are calculated as residuals.

Calculated by IMF staff using 1995 export and import weights.

Sources: CEIC database; and data provided by the Singapore authorities.

Values in millions of Singapore dollars, volumes and prices in indices, 1995 = 100.

Volumes in this table are calculated as residuals.

Calculated by IMF staff using 1995 export and import weights.

Table 37.Singapore: Services and Income Accounts, 1996–2001(In millions of Singapore dollars)
1996199719981999200020002001
Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Services Balance14,417.017,093.42,554.88,569.19,710.42,040.22,692.53,091.71,886.02,059.2
Exports of Services42,241.345,276.432,048.540,653.546,616.210,341.211,779.312,507.111,988.611,244.2
Transportation7,322.37,658.97,457.07,758.09,198.72,030.42,211.42,443.82,513.12,173.7
Travel10,551.79,444.98,228.38,806.69,950.12,412.12,406.92,554.42,576.72,302.7
Insurance559.7661.2898.8870.01,343.3370.5300.8351.3320.7432.7
Government137.9137.9162.4137.9137.634.434.434.434.434.4
Others23,669.727,373.515,302.023,081.025,986.55,493.86,825.87,123.26,543.76,300.7
Imports of Services27,824.328,183.029,493.732,084.436,905.88,301.09,086.89,415.410,102.69,185.0
Transportation8,860.79,380.39,730.010,660.013,800.83,055.53,274.53,616.33,854.53,712.9
Travel8,115.97,736.07,814.07,792.08,597.71,865.72,211.42,062.22,458.42,072.4
Insurance1,414.51,484.41,226.61,360.51,664.5362.3405.5445.8450.9381.8
Government137.2166.1189.1187.9184.956.242.942.942.956.2
Others9,296.09,416.210,534.012,084.012,657.92,961.33,152.53,248.23,295.92,961.7
Income Balance2,031.39,599.88,579.011,358.010,554.72,663.52,885.92,541.82,463.52,210.1
Income Receipts17,672.720,628.621,705.025,382.026,294.66,248.46,833.06,614.96,598.35,803.0
Of which: Investment income17,578.220,498.621,574.225,244.926,146.76,211.46,796.66,577.66,561.16,562.1
Income Payments15,641.411,028.813,126.014,024.015,739.93,584.93,947.14,073.14,134.83,592.9
Of which: Investment income15,238.210,578.712,613.313,578.215,271.23,474.13,829.73,953.04,014.44,015.4
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 38.Singapore: Transfer Payments, 1996–2001(In millions of Singapore dollars)
1996199719981999200020002001
Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Current Transfers (Net)-1,505.2-1,735.5-1,837.0-1,972.5-2,342.1-512.3-536.9-572.1-720.8-557.3
General Government-324.2-348.3-242.0-375.3-504.3-104.7-121.0-136.7-141.9-137.8
Inflow9.212.216.615.515.84.04.03.93.94.1
Outflow333.4360.5258.6390.8520.1108.7125.0140.6145.8141.9
Other Sectors-1,181.0-1,387.2-1,595.0-1,597.2-1,837.8-407.6-415.9-435.4-578.9-419.5
Inflow211.7211.3211.2211.1211.652.853.052.952.952.8
Outflow1,392.71,598.51,806.21,808.32,049.4460.4468.9488.3631.8472.3
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
Table 39.Singapore: Financial and Capital Account, 1996–2001(In millions of Singapore dollars)
1996199719981999200020002001
Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1
Capital flows (including errors and omissions)-7,673-14,762-29,050-29,544-25,741-11,146-2,912-6,028-5,655-8,353
Capital and financial account balance-6,999-16,555-36,884-31,308-19,932-9,14027949-11,120-7,675
Capital account (Net)-196-257-378-324-281-71-79-71-59-66
Financial account (Net)-6,803-16,298-36,506-30,984-19,651-9,069358120-11,061-7,609
Direct investment4,9985,3569,6425,4003,6451,569575583918458
Inflow14,62519,25410,57012,19811,0173,4332,4392,4462,6992,323
Outflow-9,627-13,898-928-6,798-7,371-1,864-1,863-1,863-1,781-1,865
Portfolio investment-16,480-19,310-11,728-12,009-23,889-6,796-6,196-5,262-5,635-4,090
Assets-17,802-19,433-12,848-15,642-20,300-3,947-5,413-5,810-5,130-3,125
Liabilities1,3221221,1203,633-3,590-2,849-783548-505-965
Of which: Equity securities1,3391251,1113,637-3,588-2,849-782543-500-972
Other investment4,678-2,344-34,420-24,375593-3,8425,9794,799-6,344-3,977
Assets-19,089-61,905-5,949-35,720-9,122-17,9028,3414,547-4,109-11,286
Banks-4,981-18,3853,711-18,0772,284-13,8116,4545,4744,166-7,102
Other sectors-14,108-43,521-9,660-17,643-11,406-4,0911,887-927-8,275-4,185
Liabilities23,76759,561-28,47111,3459,71514,060-2,362251-2,2357,309
Banks11,32527,746-21,4015,44112,79912,165-2102,015-1,1716,052
Other sectors12,44231,815-7,0705,904-3,0851,895-2,152-1,764-1,0641,257
Net errors and omissions-6741,7937,8341,764-5,809-2,006-3,191-6,0765,465-678
Official reserves (net)-10,407-11,856-4,981-7,321-11,8352,171-5,860-4,394-3,753-979
Special drawing rights-9-38-11212-30-8-3-10-9-9
Reserves position in the IMF2-136-50-29441041-10-1
Foreign exchange assets-10,399-11,682-4,819-7,039-11,8462,179-5,897-4,383-3,745-969
Sources: CEIC database; and data provided by the Singapore authorities.
Sources: CEIC database; and data provided by the Singapore authorities.
1Prepared by Abdelhak Senhadji (x38380), who is available to answer questions.
2No data are available on deflators at the level of disaggregation used here.
3Note that the index in Table II.4 is a measure of relative (to the whole manufacturing sector) labor productivity.
4Capital-labor ratio is the only right-hand side variable in equation (.1) since Solow’s model implies that it is the only relevant explanatory variable.
5More precisely, the reported standard errors are the standard errors of the de-meaned series of real GDP growth rates, that is, the standard errors of regression of the first difference of the log of real GDP on a constant.
1Prepared by Kalpana Kochhar (x38770) and Yutaka Nishigaki (x37368), who are available to answer questions.
2A detailed discussion of the evolution of Singapore’s financial system is contained in Singapore: Selected Issues, SM/00/96, May 2000.
3The authorities are currently conducting a comprehensive review of the minimum liquid asset requirement focusing on liquidity risk management in the banking system. The review is not aimed at debt market development per se, although reforms of the liquidity management system will likely impact debt markets.
4A more detailed discussion of the policy of not encouraging the internationalization of the Singapore dollar is covered in Chapter IV of this volume.
5QDS are defined by the MAS as debt securities that are substantially arranged by financial institutions in Singapore.
6Income derived from the Singapore establishment itself would not be exempted from tax.
1Prepared by Jaewoo Lee (x37331) who is available to answer questions.
2For the purpose of this regulation, residents and nonresidents include bank and nonbank customers. Nonresidents include Singapore-incorporated companies, which are majority-owned or otherwise controlled by nonresidents. Residents include Singapore citizens and permanent residents in Singapore.

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