Morgan Stanley Research has unveiled a report highlighting Singapore’s potential for significant wealth creation as it approaches its 60th anniversary of independence. The report outlines how Singapore’s established position as a global hub for data, energy, finance, and transport, combined with its rapid adoption of emerging technologies, positions it for economic growth. The bank forecasts a 3% compound annual growth rate in GDP over the next five years, the highest among developed economies.
The report emphasises that wealth creation is crucial for addressing the challenges posed by Singapore’s ageing population. Morgan Stanley predicts that household net assets could nearly double to reach $4 trillion by 2030, signalling substantial wealth creation. The report also anticipates improved productivity driving a rise in return on equity (RoE) from 12% to 14%, with price-to-book (P/B) multiples increasing from 1.7x to 2.3x, potentially doubling the stock market capitalisation by 2030.
Singapore’s strategic focus on governance, macroeconomic stability, and international cooperation positions it well in a complex geopolitical landscape. The report notes that Singapore’s large-cap companies have adeptly adapted to global trends, whilst its burgeoning tech start-up ecosystem is nurturing unicorns ready for public listing. An unprecedented government initiative to revitalise the stock market, involving substantial capital inflows, could see index values double within five years.
In conclusion, Morgan Stanley’s report underscores Singapore’s readiness to leverage its institutional strengths and technological advancements to drive wealth creation, promising significant gains for investors and bolstering the nation’s economic standing on the global stage.
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