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ELECTRONICS SECTOR TO SLOW DOWN SINGAPORE ECONOMY

Singapore is one of the most developed countries in the capital which has a big GDP from its stakes and this article tells you how the economy of Singapore is bearing down fall in the electronic sector. It has an open business environment, relatively corruptionfree and transparent, stable prices, low tax rates compared to other developed

economies, and one of the highest per-capita gross domestic products (GDP) in the world. The economy of Singapore has been given a nick name as Singapore Model for being innovative which combines the planning for economy with the free market. (economywatch, 2012) Electronic sector is one of the most powerful and dominating sector in the economy of Singapore which was previously taking it to the heights, but in the first quarter of this year, the electronic sector of Singapores economy has shown a lot of decline and instead of recovering, this sector is showing signs of downfall and is slowing down. Recently, the economists are saying that there are no signs that the economy of Singapore will go up in the current year. This sector of the economy is a major part of Singapores development which is losing its value (breaking news/singapore, 2012). The current increased rates of oil, gas and labor wages in the entire world is causing slow down in many economies including Singapore. In encouraging news on economic conditions at Singapore Lee Hsien Loong has said that national government is ready to introduce as many economic stimuli packages as needed to prop up national economy. Economist of Singapore and the government is known to it that the whole procedure would take a noteworthy time before Singapore economic conditions get back to normal (breaking news/Singapore, 2012). May be the current inflation of the world is the reason of this slum, but instead of this inflation, the economy of Asian countries is still showing a bit of improvement. Although the economy of Singapore is very strong and is ranked in the top economies of the world, but still it has to bear the current recession. Singapores economy is ranked as the worlds second most open economy by the Heritage Foundations Index of
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Economic Freedom (breaking news/singapore, 2012). The financial crisis of worlds financial economies were started in 1997 due to high foreign debt, but the economy of Singapore was still stable than the other economies. The country also weathered the 2008 global financial crisis and in fact emerged as one of the worlds fastest growing economies in 2010; a time when the developed economies of US and Europe were still struggling with the aftermath of the crisis. This is despite the fact that Singapore has no natural resources and a very small land area. The economy is driven by (a) exports in electronics manufacturing and machinery, (b) financial services, (c) tourism, (d) the worlds largest cargo seaport. No doubt the electronics industry is called a center stage of any economy in todays transforming and globalized market and it needs to be improved with the demand of the world. While many choose to stay away from the hard hitting question how to survive in the economic slowdown? Reasons of the serious recession in Singapore: The reasons are not limited which directly or indirectly hit an economy and so there are many reasons behind this severe recession in the Singapore. The main reason is the low demand for the electronic products in the entire world due to many new industries came into existence. This has hit the income of the Singapores economy very badly. Almost quarter of the GDP (Gross Domestic product) of Singapore is based upon the manufacturing sector of this economy and the 50% of this quarter GDP is derived from the electronic and technological equipments made by this sector. (economywatch, 2012) Effects of global recession on Singapores economy: Almost the entire world in facing severe recession and this global recession has also hit the economy of Singapore badly. The economy of Singapore is depended on exports as it earns a major part of its income from exports which is almost 66%. The export partners of Singapore should be in good condition to bring this economy back to normal. (economywatch, 2012)

Solutions to current electronic sectors problems in the economy of Singapore: The main purpose of giving some solutions about the economic fall down of Singapores electronic sector is to make this sector worthwhile once again and by adopting such solutions, this sector will go up once again. If there is a slowdown in the country of Singapore, then there will be a slowdown in the exports too and it said to be the worst condition of an economy. So Singapores government needs a quick come back to overcome its losses and slowdown to keep its economy on balance (breaking news/Singapore, 2012). The industry of Singapore should concentrate on the domestic recruitments for ICT and IT application, ranging from training and education, health care to egovernance. For these reasons, differences in factor costs, effectively the costs of skilled and unskilled labor, can drive the global production location

decisions for different fragments in the production process (breaking news/Singapore, 2012). Presently companies are too involved with export market for IT and ICT services, which is an important market for any economy to get a good name in the entire world. Singapores electronic sector has lost its name due to high prices. The upcoming economy of china has taken over all the other economies by providing the same products on relatively low prices. The Singapores economists and industries of electronic sector should be aware of the global demand of the products in the entire world. Exports are the main source of revenue for the economy of Singapore and the slowdown in the export can be caused a big loss for any economy, the government and industrial sector should make such strategies which will be helpful for them in improving their export of electronic goods. (economywatch, 2012) The economist along with the government and governmental policies should focus on their strategies about the electronic goods that have been implemented by the state for
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the

purpose

of

encouraging

the electronic

industry within

the

country

and those which are still lying on the table to get recommendations. (economywatch, 2012)

Conclusion: Electronic sector has automated assembly, inspection and testing facilities as also precision machining capabilities. It adheres to strict process and

manufacturing standards, producing worldclass products. A network of marketing and customer support centers across Singapore completes the vertically

integrated company profile. Economist of Singapore and the government is known to it that the whole procedure would take a noteworthy time before Singapore economic conditions get back to normal. The economy is driven by (a) exports in electronics manufacturing and machinery, (b) financial services, (c) tourism, (d) the worlds largest cargo seaport. No doubt the electronics industry is called a center stage of any economy in todays transforming and globalized market and it needs to be improved with the demand of the world.

Works Cited
breaking news/Singapore. (2012, 04 30). Retrieved 06 04, 2012, from straitstimes: http://www.straitstimes.com/BreakingNews/Singapore/Story/STIStory_794047.html economywatch, e. (2012, 10 14). Singapore economic condition. Retrieved 06 03, 2012, from economy watch: http://www.economywatch.com/economic-conditions/Singapore.html