Things are getting really expensive these days. Not sure you are feeling the pinch. Inflation is really setting in these days. Food is getting more expensive. Drinks are going up from 90 cents to 1.20. Food is getting from $2 to $3-5 dollars.
Then again who to blame them if rent prices are also going up?? Everything goes up, we, consumers, especially the middle income group, really suffers.
(anyway, i love my chicken rice)
Let me share this article with you.
Mon May 21, 2007 6:42 pm (PST)
Singapore's Rich-Poor DivideThe island's economy is booming. So why are so many citizens worse offthan they were 10 years ago? By Sonia Kolesnikov-Jessop NewsweekInternationalJan. 29, 2007 issue -
Singapore's Rich-Poor DivideThe island's economy is booming. So why are so many citizens worse offthan they were 10 years ago? By Sonia Kolesnikov-Jessop NewsweekInternationalJan. 29, 2007 issue -
Tiny Singapore, with its population of 4.3million, is often lauded for the way it has embraced globalization tomaximum advantage. In the last decade, the city-state has opened itsdoors wide to foreign investment and talent, slashed corporate taxes,offered incentives to nurture strategic industries (such as biotech,pharmaceuticals and financial services) and cut free-trade deals with ahost of other countries. The payoff has seemed clear: over the pastthree years, Singapore's economy has averaged 7.6 percent growth—astaggering pace for an industrialized state—and created new jobs ata rate any European government would envy.There's only one problem: average citizens have yet to reap thebenefits. New statistics reveal that middle-class households have tastednone of Singapore's spectacular growth, and that the island's poorest 30percent are worse off than they were five years ago. "Although we haveseen very strong growth, we're experiencing this new phenomenon ofmedian real-wage stagnation and low-income decline," says Yeoh LamKeong, vice president of the Economic Society of Singapore.This predicament is hardly unique. Wages and salaries are stagnatingacross the industrial world. What's surprising is that even a countryfamous for its smart and transparent leadership has been unable toprevent the gains of globalization from flowing mostly to richindividuals and multinational corporations. In its bid to adaptSingapore's economy to international competition, the government hastried hard to reduce business costs. This has meant slashing laborprices, which has helped push wages down. According to official figures,over the past five years Singapore's wealthiest 10 percent have seentheir income rise by 2.3 percent annually (and that doesn't includenonwage earnings such as capital gains or dividends). At the same time,the poorest 10 percent have suffered a staggering 4.3 percent drop intheir salaries each year. The government has also allowed employers tocut their contributions to Singapore's Central Provident Fund, whichpays for pensions, public housing, medical expenses and education.Together, these factors have led to lower-than-expected privateconsumption, which has risen by just 3 percent in the past two years."Private consumer spending has been the weak link in this currentexpansion," says Chua Hak Bin, an economist at Citigroup Global Marketsin Singapore. This has, in turn, stung Singapore's large retail sector."It is evident that [they] are not the big winners from high growth,"says Manu Bhaskaran, a director of the U.S.-based Centennial Group.Foreign competition is also hurting. Contractor Tan Boon Soo is one ofmany Singaporeans feeling the pinch. He installs windows for a livingbut laments "cutthroat competition" from contract laborers, who haveflooded the island from places such as Indonesia and Bangladesh.Unskilled workers like street sweepers and security guards are alsofinding themselves undercut by immigrants willing to work for less. Thisis forcing native Singaporeans to change occupations or work harder forless money. "They talk about growth, but I don't see it," says Tan."Maybe the bankers are doing well, but construction has not been. I'mworse off now than I was in 1997."All this could spell big trouble. "If these trends continue unchecked,"warns Yeoh, "we could begin to get the formation of an underclass [and]the makings of social instability. " Such an underclass was never part ofSingapore's grand plan. Now its leaders must figure out how to preventone from emerging without relying on the kind of welfare programs theyoften deride. Last year the government launched an experimental workfareprogram that gave low-wage earners bonus pay of up to $780. Now PrimeMinister Lee Hsien Loong's government is con- sidering making theprogram permanent in an effort to thin the ranks of the working poor."We will try out different forms, but the principle will be thesame—help yourself [and] we will help you," the prime minister toldlawmakers last November. "It's essential for us to tilt the balance infavor of lower-income Singaporeans because globalization is going tostrain our social compact."Lee has already announced that he'll make Singapore's rich-poor divide amajor focus of his annual budget speech next month.If knowing is half the battle, it could be an important first step.
