Singapore strongly believes in a free market economy. This also means that it is vulnerable to external shocks. The following is a brief chronology of recent economic events, which goes to show that Singapore, while vulnerable, is also quick to bounce back sfrom setbacks:

1997 - Singapore was hit by the regional crisis that started with the devaluation of the Thai Baht.

1998 - Singapore's economy contracted 0.9% in 1998, after achieving 8.6% growth in 1997.

2001 - Singapore was hit by another recession, with the synchronised downturns in major developed economies and terrorist attacks on 11 September. The economy fell by 1.9%, down from 9.7% growth in 2000.

2004 - The economy registered stronger growth of 7.5% in the first quarter of 2004, up from 4.9% in the previous quarter. All major sectors saw improvements in year-on-year growth when compared with the previous quarter, led by manufacturing and wholesale and retail trade.

The Singapore government is making headway to establish a new growth path that will be less vulnerable to the external business cycle than the current export-led model, focussing on high value-added industries such as info-communications and biotechnology.