Singapore has a highly developed market-based economy, which historically revolves around extended entrepot trade. Along with Hong Kong, South Korea and Taiwan, Singapore is one of the Four Asian Tigers. The economy depends heavily on exports refining imported goods, especially in manufacturing. Manufacturing constituted 26% of Singapore's GDP in 2005. The manufacturing industry is well-diversified into electronics, petroleum refining, chemicals, mechanical engineering and biomedical sciences manufacturing. In 2006, Singapore produced about 10% of the world's foundry

Singapore has been rated as the most business-friendly economy in the world, with thousands of foreign expatriates working in multi-national corporations. Singapore is also considered to be one of the top centres of finance in the world and throughout the region. In addition to this, the city-state also employs tens of thousands of foreign blue-collared workers around the world.

Singapore's Central Business District (CBD)As a result of global recession and a slump in the technology sector, the country's GDP contracted 2.2% in 2001. The Economic Review Committee (ERC) was set up in December 2001, and recommended several policy changes with a view to revitalising the economy. Singapore has since recovered from the recession, largely due to improvements in the world economy; the Singaporean economy itself grew by 8.3% in 2004, 6.4% in 2005 and 7.9% in 2006. On 19 August 2007, Prime Minister Lee Hsien Loong announced in his National Day Rally Speech that Singapore's economy is expected to grow by at least 4-6% annually over the next 5-10 years.

The per capita GDP in 2006 was US$29,474. As of September 2007, the unemployment rate is 1.7%, which is the lowest in a decade, having improved to around pre-Asian crisis level.[49] Employment continued to grow strongly as the economy maintained its rapid expansion. In the first three quarters of 2007, 171,500 new jobs were created, which is close to the 176,000 for the whole of 2006. For the whole of 2007, Singapore's economy has grew 7.5% and drew in a record S$16 billion (US$10.6b)of fixed asset investments in manufacturing and projects generating S$3 billion (US$2b)of total business spending in services.

Orchard Road is decorated for Christmas, 2005.Singapore introduced a Goods and Services Tax (GST) with an initial rate of 3% on 1 April 1994 substantially increasing government revenue by S$1.6 billion (US$1b,€800m) and stabilising government finances. The taxable GST was increased to 4% in 2003, to 5% in 2004, and to 7% on 1 July 2007.

Due to the economic recession, Singapore's economy expanded by only 1.1% in Year 2008, much lower than the expected 4.5% to 6.5% growth, while the unemployment rate was at 2.8%. The economy is expected to contract greatly by 8% in 2009 and unemployment could rise to 5 percent this year as forecast by several private sector economists.

Transportation

International

The Port of Singapore with Sentosa island in the background.
Singapore is a major Asian transportation hub, positioned on many sea and air trade routes.

The Port of Singapore, managed by port operators PSA International and Jurong Port, was the world's second busiest port in 2005 in terms of shipping tonnage handled, at 1.15 billion gross tons, and in terms of containerised traffic, at 23.2 million twenty-foot equivalent units (TEUs). It was also the world's second busiest in terms of cargo tonnage, coming behind Shanghai with 423 million tons handled. In addition, the Port is the world's busiest for transshipment traffic and the world's biggest ship refuelling centre.

PSA KeppelSingapore is an aviation hub for the Southeast Asian region and a stopover on the Kangaroo route between Australasia and Europe. Singapore Changi Airport has a network of 81 airlines connecting Singapore to 185 cities in 58 countries. It has been rated as one of the best international airports by international travel magazines, including being rated as the world's best airport for the first time in 2006 by Skytrax. The airport currently has three passenger terminals. There is also a budget terminal, which serves budget carrier Tiger Airways and Cebu Pacific. The national carrier is Singapore Airlines (SIA). The government is moving towards privatising Changi airport.

Singapore is linked to Johor, Malaysia via the Johor-Singapore Causeway and the Tuas Second Link, as well as a railway operated by Keretapi Tanah Melayu of Malaysia, with its southern terminus at Tanjong Pagar railway station. Frequent ferry service to several nearby Indonesian ports also exists.

A C751B train at Eunos MRT Station on the Mass Rapid Transit (MRT) system, one of three heavy rail passenger transport lines in Singapore.

Domestic
The domestic transport infrastructure has a well-connected island-wide road transport system which includes a network of expressways. The public road system is served by the nation's bus service and a number of licensed taxi-operating companies. The public bus transport has been the subject of criticism by Singaporeans, the majority of whom are dependent on it for their daily commuting. Since 1987, the heavy rail passenger Mass Rapid Transit (MRT) metro system has been in operation. The MRT has been further augmented by the Light Rail Transit (LRT) light rail system, and increases accessibility to housing estates. Established in 2001, the EZ-Link system allows contactless smartcards to serve as stored value tickets for use in the public transport systems in Singapore.

More than 2.85 million people use the bus network daily, while more than 1.5 million people use either the LRT or MRT as part of their daily routine. Approximately 945,000 people use the taxi services daily. Private vehicle use in the Central Area is discouraged by tolls implemented during hours of heavy road traffic, through an Electronic Road Pricing system. Private vehicle ownership is discouraged by high vehicle taxes and imposing quotas on vehicle purchase.

Resources

Water resource

Without natural freshwater rivers and lakes, rainfall is the primary domestic source of water supply in Singapore. About half of Singapore's water comes from rain collected in reservoirs and catchment areas while the rest comes from Malaysia. The two countries have long argued of the legality of agreements to supply water that were signed in colonial times.

Singapore has a network of reservoirs and water catchment areas. In 2001, there were 19 raw water reservoirs, 9 treatment works and 14 storage or service reservoirs locally to serve domestic needs. Marina Barrage is a dam being constructed around the estuary of three Singapore rivers, creating a huge freshwater reservoir by 2009, the Marina Bay reservoir. This will increase the rainfall catchment to two-thirds of the country's surface area.

Historically, Singapore relied on imports from Malaysia to supply half of its water consumption. However, two water agreements that supply water to Singapore are due to expire by 2011 and 2061 respectively. The two countries are engaged in a dispute on the price of water. Without a resolution in sight, the government of Singapore decided to increase self-sufficiency in its water supply. Presently, more catchment areas, facilities to recycle water (producing NEWater) and desalination plants are being built. This "four tap" strategy aims to reduce reliance on foreign supply and to diversify its water sources.. In 2008, a water barrage name - The Marina Barrage was built across the Marina Channel between Marina East and Marina South. The barrage aims to provides additional water supply catchment area, improve flood control and serve as an outdoor attraction for tourist and singaporean.