S'pore wins US$3.95b investment, Goh says

S'pore wins US$3.95b investment, Goh says

SINGAPORE (Reuters): Singapore attracted S$6.9 billion (US$3.95 billion) in direct investment in fixed assets and S$1.2 billion in business spending in the first eight months of this year, Prime Minister Goh Chok Tong said on Saturday.

A spokesman for Goh later told Reuters that three-quarters of the investment came from overseas sources, including the United States, Europe and Japan, with the rest from Singapore companies.

Half of the fixed asset investment was for the electronics industry, one-quarter for the chemicals sector and the rest for a variety of other sectors, the spokesman said.

Two-third of the business spending came from international information, communications and technology companies operating in Singapore, the spokesman added.

The investments would generate 18,000 jobs when realised and reflected investors' strong confidence in Singapore despite the difficult economic environment, said Goh in a speech to utility workers.

"We will do everything possible to attract investment, promote enterprise development and help workers stay employable," he said.

Goh called on Singaporeans to be prepared for a more prolonged economic downturn.

He pointed out that the Sept.11 attack on the United States has put the global economy, including Singapore's economy, into uncertain times. "We have very little clue at this point as to how the global economy will respond in the next few months.

"We are in unchartered waters as the events are still being played out," he said.

"The concern among Singaporeans of job losses is palpable and rising," he said, disclosing that retrenchment has risen to about 5,600 in the second quarter and might exceed the official estimate of 20,000 for the whole of this year.

Goh said companies had started restructuring and downsizing while one consumer electronics company was relocating its regional headquarter elsewhere and had retrenched its entire local staff.

Goh also pointed out that the restructuring of Singapore's utility industry, amidst the global economic downturn, was necessary to help Singapore maintain its competitive edge.

"Singapore must be prepared for "negative growth this year," Goh warned.

"While the situation is still fluid and dependent on events in the U.S., we must now expect negative growth this year," said Goh at a workers' awards ceremony. "We have very little clue at this point as to how the global economy will respond in the next few months."

Singapore slipped into recession earlier this year, largely because of a slump in demand in the U.S. for its high-tech exports.

Goh did not say how much the government expects the economy to contract.