Regional crisis worse than thought: PM Goh

Regional crisis worse than thought: PM Goh

SINGAPORE (Dow Jones): Singapore Prime Minister Goh Chok Tong
yesterday warned that the region's economic crisis is worse than
initially believed and called on Japan to do more to stimulate
its sputtering economy.

"The region is in deeper recession than earlier thought," Goh
told a dinner audience from the Development Bank of Singapore
Ltd., one of the city-state's big four banks. "How much longer
the turmoil will last or how much worse it will get before it
gets better, no one knows for certain."

The prime minister, who said earlier this month that the
chances of a recession in Singapore are "fairly high," told the
bankers that Southeast Asia faces the "twin threats of recession
and inflation."

The Singapore prime minister said the general weakness of the
Japanese yen and the "poor performance" of the country's economy
has added to the region's misery.

Without addressing directly the change of leadership in Japan,
Goh said, "Japan has taken decisive steps to deal with its
banking problems, stimulate its economy in the near term and
restructure over the medium term. But it needs to do more to turn
the economy around."

Touring the region rhetorically, he said Indonesia faces the
prospect of "a sharp contraction", while Thailand and South Korea
"are by no means out of the woods" because their debt burdens
remain high.

"Malaysia," he continued, "is looking for funds to rescue its
bank and debt-ridden corporations."

Singapore, an island of about 3.1 million people, is
sandwiched between the much larger countries of Malaysia and
Indonesia.

In admonishing domestic critics who say the government hasn't
done enough to address the crisis, Goh reiterated that the
problem in Singapore is caused by external shocks over which
Singapore has little control.