PM Lee Hsien Loong's Chinese New Year Message 2011

Singapore’s economy roared in the Year of the Tiger. We pulled ourselves out of recession, and delivered an exceptional economic performance. Workers are enjoying better bonuses, and all over the island the mood is vibrant and joyous during this festive period.

The momentum is carrying into the Year of the Rabbit. Our prospects are good, boosted by robust growth in Asia and strong investment flows into Singapore. But we need to watch for risks that remain in the global economy, especially in the US and Europe.

As our economy has picked up, property prices have risen significantly, especially over the past year. This partly reflects optimism and confidence in our economy, on the part of both Singaporeans and foreign investors. But it is also due to global monetary conditions: interest rates are very low and liquidity abundant, so global funds are chasing higher-yielding assets in Asia. That is why other Asian cities like Hong Kong and Shanghai are also struggling to control property booms.

The Government has acted to curb speculation and cool the property market. We will do more to stabilise the market if and when this becomes necessary. We will keep housing affordable to Singaporeans, especially public housing. At the same time, in a prospering economy home owners should see their properties appreciating in value over the long term.

Other external factors are pushing up consumer prices across Asia, including in Singapore. World oil prices have risen recently, leading to higher electricity, petrol and diesel prices. Floods and bad weather in several countries have disrupted crops, causing shortages and raising food prices. Locally, COE prices have gone up, because fewer COEs are available for auction, while with rising incomes more people want to buy cars. For these reasons, we expect somewhat higher inflation over the next few months, but we hope prices will stabilise later in the year.

The Government will strive to mitigate the impact of rising prices. The strong Singapore dollar has lowered the cost of imported goods in Singapore dollar terms. And after a good year last year, the Government has more scope to implement schemes to help Singaporeans cope with rising costs, especially lower-income households.

Singapore is small and open to the world. Each time external conditions change, it affects us. But we have learnt to take this in our stride. We know that we have to stay open, in order to seize opportunities and prosper. The price we pay is that we must keep changing and reinventing ourselves. This we have done successfully. Over the last few years, we have transformed our cityscape, with a spectacular skyline at Marina Bay, new and beautiful housing estates, and park connectors and waters all over the island. Our society is changing too. Young people today have different attitudes and aspirations from earlier generations. And our population has been augmented with a good number of new immigrants.

Some Singaporeans are concerned about the rapid changes in our society, and feel a sense of dislocation and unfamiliarity. We will manage the pace of change, so that we keep our bearings, sense of place, and sense of belonging. But we cannot stay static. Singapore has to keep up with the world, or else we will stagnate and decline.

Even as we change, we must hold fast to certain constants: the core values which help Singapore to succeed; the heritage and cultures which make us Asian and Singaporean; and the national cohesion and spirit which enable us to surmount crises together. This means we have to preserve a Singaporean core in our society. We need immigrants to reinforce our ranks, but we must maintain a clear majority of local-born Singaporeans who set the tone of our society, and uphold our core values and ethos. We are managing the inflow of foreigners who want to live and work here. Many want to become permanent residents and new citizens, but we will only select those who can add value to Singapore.

We also need Singaporeans to produce enough babies to replace ourselves, and that has proved extremely challenging. Last year, our Total Fertility Rate fell to 1.16, an all time low. It was even lower for the Chinese – only 1.02, but the decline was for all races. It could have been because of the Year of the Tiger, or perhaps the economic uncertainties the year before, in 2009. Whatever the reasons, I hope more couples will start or add to their families in the Year of the Rabbit. Chinese New Year is the time for families to come together in celebration, and more babies can only mean more joy in the years to come.

We must also keep our mother tongues alive, for language is a key vehicle for transmitting values and culture. Our bilingual education policy has helped to make us a global city and yet kept us an Asian society. We regularly update and improve the teaching of mother tongue languages in our schools, to keep it current and effective. Hence the recent measures announced by the Ministry of Education, which will help a new generation to use their mother tongue languages freely in a changing language environment.

The community has to play an active role keeping our culture and heritage vibrant. I am encouraged that organisations like the Singapore Federation of Chinese Clan Associations (SFCCA) and Business China are working to promote the use of the Chinese language, preserve traditional culture and develop an appreciation and love for our heritage. I am also glad that we are celebrating Chinese New Year in refreshing and fun ways, for example by making the ‘River Hongbao’ show more interesting and spectacular. The Government encourages and supports these efforts, as well as similar initiatives of the Malay and Indian communities.

Our culture has to be a living asset. We hold on to it not by keeping it frozen, but by re-inventing it for each new generation, preserving its essence while adapting its forms to changing times and circumstances. This is how we can keep the essence of what makes us Singaporean, and keep Singapore thriving.

Singaporeans can look forward to a bright future together. The rise of Asia will generate buzz and vitality in our economic and cultural landscapes. We are well placed to be part of the region’s development, to become a shining city at the heart of a booming Asia.

I wish all Singaporeans a very happy Year of the Rabbit.