Some of you have asked what a small and open economy means. Here's what it means:
Straits Times 7 May 09
SINGAPORE'S economy has become even more open over the past 10 years, making it the most vulnerable among the Asian economies in a global slowdown.
But this openness will mean a quicker rebound when a global recovery kicks in.
Despite diversifying its economy, Singapore's reliance on exports has in fact increased, rising from 70 per cent of total demand in 1998 to 76 per cent last year.
This openness and trade dependency makes the economy 'more susceptible to global headwinds'.
Countries accounting for 57 per cent of Singapore's exports are projected to be in a full-year recession this year, compared with 50 per cent in 1998 and just 5 per cent in 2001 - Singapore's most recent periods of recession.
The same openness of the Singapore economy should also enable us to pick up more strongly than other countries when the global recovery eventually gets under way.
'The bottoming of the economy will happen later rather than sooner, next year rather than this year.'He does not expect a quick return to business as usual, especially for smaller export-oriented economies which would face problems of excess capacity and deflation.
