As Lawrence Wong prepares to take over as Singapore’s Prime Minister next month, he will inherit a thriving economy characterized by a robust local currency, outperforming bonds, and strong stock market performance. Under Prime Minister Lee Hsien Loong, who has served since 2004, the Singapore dollar has appreciated approximately 40% against the currencies of the city-state’s major trading partners. This gain is more than double that of the US dollar during the same period, according to Bloomberg-compiled data.

Singapore’s total returns on government bonds have also outperformed their global counterparts by around 16 percentage points since Lee took office. The economic landscape has transformed significantly, with the size of Singapore’s economy more than doubling to S$532.3 billion, while total assets under management have surged more than eight-fold to S$4.9 trillion.

Lee’s tenure has positioned Singapore as one of the world’s leading financial hubs, attracting global talent and investment. The Straits Times Index, Singapore’s primary stock market index, has outperformed the MSCI ASEAN Index by nearly 32 percentage points when measured in US dollar terms since Lee’s administration began.

However, despite the strong performance of the Singapore dollar and the stock market, over half of the locally listed companies are trading below their book value, indicating a lack of high-growth firms in Singapore’s mature economy. Nirgunan Tiruchelvam, head of consumer and Internet at Aletheia Capital, noted that there are opportunities for Wong to bolster local equities. This could involve sovereign wealth funds investing more in local markets or enhancing incentives for companies to list on the Singapore market.

As Wong steps into his new role, he will face the challenge of sustaining this economic momentum and addressing the needs of a changing financial landscape.