[h=2]S’pore ‘is richest country per capita’ ?[/h]
September 16th, 2012 |
Author: Ng Kok Lim
Singapore 'is richest country'...
Dear Straits Times,
I
refer to your report on Singapore being the richest country per capita in 2010 [1], [2] based on Knight Frank and Citi Private Bank’s Wealth Report 2012.
World Bank ranks Singapore fourth in per capita GDP in 2010 [3]:
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</tbody>Kni
ght Frank and Citi Private Bank must have focused on First World / developed / advanced nations so they skipped Qatar and Macao. But they shouldn’t have skipped Luxembourg which IMF classifies as an advanced economy. Considering only advanced economies, Singapore is 2nd, not 1st.
Our No. 2 ranking is nothing out of the ordinary because Singapore has been ranked 3rd or 4th since 1993 [3]:
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</tbody>We a
re thus just one or two positions better than what we have been doing for the past 17 years and this should be seen in the context of the recent Eurozone crisis affecting Eurozone nations more than it affects East Asian nations. We should also ask ourselves whether this one position improvement is worth all the problems we now face by growing at all costs.
Furthermore, we are 2nd only because GDP has been adjusted for purchasing power parity (PPP). If not for purchasing power parity, Singapore’s position is actually 15th [4].
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</tbody>Purcha
sing power parity estimates for Singapore may need some updating given Singapore’s steep price hike (especially in property) in recent years. World Bank puts Singapore’s purchasing power parity at 1.05 SGD per USD in 2010. In other words, the same basket of goods that cost SGD $1.05 in Singapore costs USD $1 in the US. But there is reason to suspect that this purchasing power parity estimate is too low. The median price of a single family home in US in 2010 is USD $173,100 [5].
If we apply purchasing power parity, the median home price in Singapore should be 1.05 × 173,100 = SGD $181,755. But the reality is far from it. The weighted average resale price index of our HDB flats, the backbone of our mass market homes, is 172 in 4th quarter 2010 [6] which works out to be SGD $418,705. Our weighted average HDB resale price alone is already more than twice that of the median US home price and we haven’t even considered the price of condominiums and landed homes which when included would raise our average / median home price even more. Given that housing is the single most costly purchase item for the average Singaporean family, it is hard to believe that SGD $1.05 can buy the same basket of goods in Singapore as US $1 can in the US
Not only that, we are ranked 18th in GDP per employed person after adjusting for purchasing power parity [7].
<tbody>
</tbody>If we exclude the GDP of foreigners and foreign owned companies in Singapore, the per capita GDP of Singaporeans and Singapore permanent residents becomes much lower and our position falls to 6th [8]:
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In short, we have become No. 1 because nations like Luxembourg have been excluded from the ranking. Our excellent ranking is nothing out of the ordinary considering it is just one, two positions better than what we have been doing since 1993. More importantly, comparing nations using PPP adjusted per capita GDP is marred by PPP itself which for the case of Singapore seem far off the mark. Other ways of comparing like GDP per employed person puts Singapore in a much worse light. Lastly, if we strip away foreigners and foreign owned companies, the per capita GDP (PPP) of Singaporeans and PRs is actually much lower.
Thank you.
.
Ng Kok Lim
[1] Straits Times, 15 Aug 2012, S’pore ‘is richest country per capita’
[2] Straits Times, 15 Aug 2012, Asian economies to top richest list by 2050: study
[3] World Bank per capita GDP PPP data at current USD prices
[4] World Bank per capita GDP data at current USD prices
[5] National Association of Realtors, Housing Affordability Index
[6] HDB resale price index
[7] World Bank 2010 GDP per employed person PPP data at 1990 USD prices
[8] Singstats, National Income and Balance of Payments, Indigenous Gross National Income
Indigenous per capita GDP of SGD $47,148 is 77.2% of our per capita GDP of SGD $61,071. 77.2% of our per capita GDP (ppp) of US $57,902 is US$ 44,702
Dear Straits Times,
I
refer to your report on Singapore being the richest country per capita in 2010 [1], [2] based on Knight Frank and Citi Private Bank’s Wealth Report 2012.
World Bank ranks Singapore fourth in per capita GDP in 2010 [3]:
| Country Name | World Bank 2010 per capita GDP PPP (current USD) |
| Luxembourg | 86,132 |
| Qatar | 77,466 |
| Macao | 63,957 |
| Singapore | 57,902 |
| Norway | 57,228 |
| Kuwait | 50,635 |
| Brunei | 50,506 |
| United Arab Emirates | 47,006 |
| United States | 46,702 |
| Switzerland | 46,384 |
| Hong Kong | 46,297 |
| Netherlands | 42,166 |
| Ireland | 40,470 |
| Denmark | 40,158 |
| Austria | 40,007 |
| Sweden | 39,325 |
| Canada | 39,050 |
| Australia | 38,158 |
| Belgium | 37,665 |
| Germany | 37,402 |
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ght Frank and Citi Private Bank must have focused on First World / developed / advanced nations so they skipped Qatar and Macao. But they shouldn’t have skipped Luxembourg which IMF classifies as an advanced economy. Considering only advanced economies, Singapore is 2nd, not 1st.
Our No. 2 ranking is nothing out of the ordinary because Singapore has been ranked 3rd or 4th since 1993 [3]:
| Year | 1st | 2nd | 3rd | 4th | 5th |
| 1993 | Luxembourg $36,516 | Switzerland $25,699 | United States $25,327 | Singapore $22,973 | Austria $21,638 |
| 1994 | Luxembourg $38,181 | United States $26,578 | Switzerland $26,338 | Singapore $25,120 | Austria $22,505 |
| 1995 | Luxembourg $38,980 | United States $27,559 | Switzerland $26,799 | Singapore $26,750 | Norway $23,612 |
| 1996 | Luxembourg $40,268 | United States $28,772 | Singapore $28,133 | Switzerland $27,476 | Norway $26,065 |
| 1997 | Luxembourg $40,894 | United States $30,282 | Singapore $30,088 | Switzerland $28,607 | Norway $27,983 |
| 1998 | Luxembourg $43,272 | United States $31,687 | Switzerland $29,604 | Singapore $28,851 | Norway $27,429 |
| 1999 | Luxembourg $49,075 | United States $33,332 | Singapore $30,841 | Switzerland $30,124 | Norway $29,801 |
| 2000 | Luxembourg $53,662 | Norway $36,137 | United States $35,082 | Singapore $33,767 | Switzerland $31,737 |
| 2001 | Luxembourg $53,895 | Norway $37,079 | United States $35,912 | Singapore $33,226 | Switzerland $32,343 |
| 2002 | Luxembourg $57,550 | Norway $37,059 | United States $36,819 | Singapore $34,864 | Switzerland $33,658 |
| 2003 | Luxembourg $60,711 | Norway $38,264 | United States $38,225 | Singapore $37,783 | Ireland $34,772 |
| 2004 | Luxembourg $64,956 | Norway $42,471 | Singapore $41,875 | United States $40,292 | Ireland $36,769 |
| 2005 | Luxembourg $68,320 | Norway $47,626 | Singapore $45,374 | United States $42,516 | Ireland $38,896 |
| 2006 | Luxembourg $78,500 | Norway $53,849 | Singapore $49,373 | United States $44,623 | Ireland $42,530 |
| 2007 | Luxembourg $84,525 | Norway $55,837 | Singapore $53,048 | United States $46,349 | Ireland $45,506 |
| 2008 | Luxembourg $89,056 | Norway $61,342 | Singapore $52,286 | United States $46,760 | Switzerland $46,018 |
| 2009 | Luxembourg $82,892 | Norway $54,688 | Singapore $50,769 | United States $45,192 | Switzerland $45,104 |
| 2010 | Luxembourg $86,132 | Singapore $57,902 | Norway $57,228 | United States $46,702 | Switzerland $46,384 |
| 2011 | Luxembourg $88,787 | Singapore $61,103 | Norway $57,092 | Hong Kong $49,990 | United States $48,442 |
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re thus just one or two positions better than what we have been doing for the past 17 years and this should be seen in the context of the recent Eurozone crisis affecting Eurozone nations more than it affects East Asian nations. We should also ask ourselves whether this one position improvement is worth all the problems we now face by growing at all costs.
Furthermore, we are 2nd only because GDP has been adjusted for purchasing power parity (PPP). If not for purchasing power parity, Singapore’s position is actually 15th [4].
| Country Name | 2010 per capita GDP PPP (current USD) | Country Name | 2010 per capita GDP (current USD) |
| Luxembourg | 86,132 | Luxembourg | 104,512 |
| Singapore | 57,902 | Norway | 85,443 |
| Norway | 57,228 | Switzerland | 67,644 |
| United States | 46,702 | Denmark | 56,278 |
| Switzerland | 46,384 | Australia | 50,746 |
| Hong Kong | 46,297 | Sweden | 49,257 |
| Netherlands | 42,166 | United States | 46,702 |
| Ireland | 40,470 | Netherlands | 46,597 |
| Denmark | 40,158 | Canada | 46,212 |
| Austria | 40,007 | Ireland | 45,873 |
| Sweden | 39,325 | Austria | 44,885 |
| Canada | 39,050 | Finland | 44,091 |
| Australia | 38,158 | Japan | 43,063 |
| Belgium | 37,665 | Belgium | 42,833 |
| Germany | 37,402 | Singapore | 41,987 |
| Finland | 36,477 | Germany | 39,852 |
| United Kingdom | 35,687 | France | 39,170 |
| France | 34,107 | United Kingdom | 36,186 |
| Japan | 33,916 | Italy | 33,788 |
| Italy | 31,895 | New Zealand | 32,620 |
| New Zealand | 30,108 | Hong Kong | 31,758 |
| Korea, Rep. | 28,798 | Korea, Rep. | 20,540 |
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sing power parity estimates for Singapore may need some updating given Singapore’s steep price hike (especially in property) in recent years. World Bank puts Singapore’s purchasing power parity at 1.05 SGD per USD in 2010. In other words, the same basket of goods that cost SGD $1.05 in Singapore costs USD $1 in the US. But there is reason to suspect that this purchasing power parity estimate is too low. The median price of a single family home in US in 2010 is USD $173,100 [5].
If we apply purchasing power parity, the median home price in Singapore should be 1.05 × 173,100 = SGD $181,755. But the reality is far from it. The weighted average resale price index of our HDB flats, the backbone of our mass market homes, is 172 in 4th quarter 2010 [6] which works out to be SGD $418,705. Our weighted average HDB resale price alone is already more than twice that of the median US home price and we haven’t even considered the price of condominiums and landed homes which when included would raise our average / median home price even more. Given that housing is the single most costly purchase item for the average Singaporean family, it is hard to believe that SGD $1.05 can buy the same basket of goods in Singapore as US $1 can in the US
Not only that, we are ranked 18th in GDP per employed person after adjusting for purchasing power parity [7].
| Country Name | 2010 GDP per employed person PPP (1990 USD) |
| United States | 68,126 |
| Hong Kong | 61,382 |
| Ireland | 57,473 |
| France | 55,033 |
| Belgium | 54,882 |
| Luxembourg | 54,449 |
| United Kingdom | 51,604 |
| Norway | 50,582 |
| Finland | 50,278 |
| Australia | 50,153 |
| Sweden | 49,778 |
| Canada | 48,916 |
| Austria | 47,474 |
| Netherlands | 46,949 |
| Denmark | 46,598 |
| Italy | 44,855 |
| Japan | 44,804 |
| Singapore | 44,524 |
| Korea, Rep. | 44,278 |
| Germany | 43,050 |
| Switzerland | 41,504 |
| New Zealand | 35,787 |
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| Country Name | 2010 per capita GDP PPP (USD) |
| Luxembourg | 86,132 |
| Singapore | 57,902 |
| Norway | 57,228 |
| United States | 46,702 |
| Switzerland | 46,384 |
| Hong Kong | 46,297 |
| Singapore residents | 44,702 |
| Netherlands | 42,166 |
| Ireland | 40,470 |
| Denmark | 40,158 |
| Austria | 40,007 |
| Sweden | 39,325 |
| Canada | 39,050 |
| Australia | 38,158 |
| Belgium | 37,665 |
| Germany | 37,402 |
| Finland | 36,477 |
| United Kingdom | 35,687 |
| France | 34,107 |
| Japan | 33,916 |
| Italy | 31,895 |
| New Zealand | 30,108 |
| Korea, Rep. | 28,798 |
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In short, we have become No. 1 because nations like Luxembourg have been excluded from the ranking. Our excellent ranking is nothing out of the ordinary considering it is just one, two positions better than what we have been doing since 1993. More importantly, comparing nations using PPP adjusted per capita GDP is marred by PPP itself which for the case of Singapore seem far off the mark. Other ways of comparing like GDP per employed person puts Singapore in a much worse light. Lastly, if we strip away foreigners and foreign owned companies, the per capita GDP (PPP) of Singaporeans and PRs is actually much lower.
Thank you.
.
Ng Kok Lim
[1] Straits Times, 15 Aug 2012, S’pore ‘is richest country per capita’
[2] Straits Times, 15 Aug 2012, Asian economies to top richest list by 2050: study
[3] World Bank per capita GDP PPP data at current USD prices
[4] World Bank per capita GDP data at current USD prices
[5] National Association of Realtors, Housing Affordability Index
[6] HDB resale price index
[7] World Bank 2010 GDP per employed person PPP data at 1990 USD prices
[8] Singstats, National Income and Balance of Payments, Indigenous Gross National Income
Indigenous per capita GDP of SGD $47,148 is 77.2% of our per capita GDP of SGD $61,071. 77.2% of our per capita GDP (ppp) of US $57,902 is US$ 44,702
