Impact of Investment and Productivity Gains on Singapore's Medium-term Growth Rate and Sustaining Annual Real GDP Growth in Next 10 Years

Mr Saktiandi Supaat asked the Deputy Prime Minister and Minister for Trade and Industry (Trade) (a) whether recent investment and productivity gains have led the Ministry to reassess Singapore's medium-term potential growth rate; and (b) what respective contributions from labour force growth, capital deepening and productivity growth would be required to sustain annual real GDP growth of around 3% to 4% over the next decade.

Mr Gan Kim Yong: Singapore's economic and productivity growth in recent quarters were largely driven by the strong performance of sectors which benefitted from the global AI investment boom. Going forward, Singapore's medium-term growth prospects depend on our continued ability to sustain productivity improvements and seize new growth opportunities while addressing longer-term challenges, including an ageing population and tighter resource constraints.

As set out in the Economic Strategy Review, Singapore aims to achieve GDP growth at the higher end of 2% to 3% per annum over the next decade. This is an ambitious goal by the standards of many advanced economies.

As workforce growth is expected to slow over the decade given our ageing population, most of the projected GDP growth will have to be supported by productivity growth. The Government will continue to invest in the necessary infrastructure as well as the capabilities of our enterprises and workers to strengthen our economy's productive capacity.