RHTLaw Taylor Wessing’s Managing Partner Tan Chong Huat shared his views on “The bull charges on” in this week’s The Business Times’ weekly column, Views from the Top.
This article was first published in The Business Times on 30 October 2017.
The bull charges on
Monday, October 30, 2017
THIS WEEK’S TOPIC: Is the current market ‘exuberance’ rational and sustainable?
Tan Chong Huat
RHTLaw Taylor Wessing LLP
The latest announcement by Prime Minister Lee Hsien Loong that Singapore’s GDP growth for 2017 could reach the upper end of the projected 2 per cent to 3 per cent range is probably the harbinger of more good news coming our way.
There are signs of mild market exuberance, particularly in the equity and property sectors. This could have been prompted by the turnaround in Singapore’s economy which has shown sustainable and moderate growth since the fourth quarter of 2016.
If this trend continues into 2018, the mild exuberance could turn into a little celebration as Singapore’s economy continues on its recovery path, growing at a sustainable rate of 2 per cent to 4 per cent.
It will also be good news for Singaporeans, especially on the employment front. A growing economy will mean a higher employment rate which spells better spending power. This will bode well for the services industries which form about 70 per cent of Singapore’s GDP in 2016.
However, the stronger GDP numbers and exuberance seen in the equity and property sectors over the past few quarters have yet to spill over into the general economy. There are still challenges ahead as we are definitely not completely out of the woods just yet.