S'pore to launch economic measures

S'pore to launch economic measures

HONG KONG (Reuters): Singapore will announce on Monday tax cuts
and increases in infrastructure spending in a bid to counter the
impact of the region's financial crisis, which is forcing the
government to lower its 1998 growth forecast, a newspaper
reported yesterday.

It was possible the country could go into recession in the
third quarter, Singapore Deputy Prime Minister Lee Hsien Loong
was quoted by Hong Kong's South China Morning Post as saying.

"Our businesses are taking some considerable pain," he told
the newspaper in an interview on Wednesday. "There are some
measures we can take to help tide them over this difficult
period."

"It is not to pump-prime the economy, give people pocket money
to spend or to completely neutralize the adversity, but something
which will be of some assistance in a time of need," he said
referring to the off-budget measures to be announced next week.

The measures would include "lower levies and taxes", and
"expenditure in specific areas", Lee was quoted as saying.

The stimulus measures would come a week after Hong Kong, often
seen as Singapore's arch-rival, launched a multi-billion dollar
package to restore confidence in its battered economy,
particularly its property sector.

Singapore's package, to be introduced in Parliament on Monday,
will include an official downgrade of the country's growth
figures for this year from 2.5-4.5 percent. The newspaper gave no
revised figures.

Lee, who is also chairman of the country's monetary authority,
said it was probable Singapore would achieve positive growth for
this year as a whole although a "technical" recession -- two
consecutive quarters of negative growth -- might occur.

"Quarter to quarter, GDP (gross domestic product) growth can
be volatile and could fulfill the technical definition of a
recession, but for a year as a whole I think we will have
positive growth," he told the newspaper.