From Official Wire:
Singapore’s defence spending will amount to US$11.4bn or 6% of GDP in 2009. As a percentage of GDP, this amounts to one of the biggest defence budgets in recent history.
Singapore has consistently had one of the largest defence budgets in the Asia Pacific region. Given its small population base, Singapore has focused on maintaining its expenditure on sophisticated and superior weaponry. Singapore has consistently spent over 4% of GDP on its defence budget. However, the principal recent development affecting the future of Singapore’s defence spending is the recent rapid deterioration in economic conditions.
Singapore was the first Asian economy to slip into recession in the current global downturn, and will move deeper into recession in 2009.
According to advance estimates by the Ministry of Trade and Industry (MTI), Singapore’s GDP registered a dismal seasonally-adjusted annualised contraction of 12.5% quarter-on-quarter (q-o-q) in Q408 (its worst performance since at least 1980), due to a sharp fall in the services sector. On a year-on-year (y-o-y) basis, GDP contracted by 2.6%, implying that full-year growth for 2008 slowed to just 1.4% from 7.7% in 2007. The manufacturing sector contracted by 9.0% y-o-y in Q408, due largely to falling demand for electronic products in developed markets and a plunge in output for precision engineering.
Defence Minister Teo Chee Hean has announced that defence spending will amount to US$11.4bn or 6% of GDP in 2009. As a percentage of GDP, this amounts to one of the biggest defence budgets in recent history. The Defence Minister stressed the importance of maintaining military spending, noting that threats do not diminish but, rather, often emerge during testing economic times, owing to increased social and political frictions. He noted several factors that had enabled Singapore to build up its defence capability over time: careful spending, sourcing and upgrading second-hand equipment, an ongoing maintenance regime, and investment into research and development.
In February 2009, the Singapore Armed Forces (SAF) announced that they will participate in a US-led task force in the Gulf of Aden designed to target pirates operating in the Gulf and adjacent waterways.
Singapore will supply a landing ship tank, two helicopters and two-hundred personnel. Joining an international flotilla comprising some forty-five warships from Europe, China and Malaysia, the SAF deployment will help to escort vessels traversing the Arabian Sea, Indian Ocean, Red Sea and the Gulf.