SINGAPORE  ECONOMY  CONTRACTS  FOR  THE

 FIRST  TIME  SINCE  1985

In the third quarter of 1998, the financial tjphoon that swept the region has left behind a tiral of destruction for greater then anjone had imagined.

This is what the Prime Minister Gon Chok Tong has said. The contraction is attributed to three factors:

- a drop in regional demand for Singapore's sqoods and reservices,

- the subsequent sharp drop in prices,

- the global downturn in electronics which accounts for 77 % of Singapore's exports of manufactored goods.

To salve the matter Mr Goh said Singapore must increase home demand, and reduce the cost of its goods and services as well as upgrade individuals skills.

The City State will also seek to cut the cost of doing business there. Singapore lost a part of electonics market in the USA

because also after the crisis the goods and services were too expencive, in fact the cost per unit labour which compares its wages with those of competitors, has risen about 17 % in the period between 1994 and 1997 .

The Gaverment would like to rebuild the Economy but also to intensify efforts to attract tourists investment and to organize busines mission oversees.