Economic Indicators To Help Decide Your Vote – No 2 of 8: GDP Per Capita

Gross Domestic Product (GDP) Per Capita is one of the main ways a country may be measured in terms of its economic success. While it may not be the only way economic success is defined, there is no denying that with all things being equal, a high GDP Per Capita would always be preferred compared to a lower GDP Per Capita.

Aligning with economic growth, GDP Per Capita should ideally always be increasing. Failure to do so would suggest that the economy is turning less productive.

GDP Per Capita can be derived by taking the total GDP and dividing it by the number of people in the country. A government cannot simply import in more people to prop up the GDP Per Capita figures.

Our growth story since the last elections

Year	GDP Per Capita (SGD)	Difference	Percentage Change
2011	66,816
2014	71,318	+ 4,502	+ 6.7%
Average Difference Per Year (Over 3 years)		+ 1,501	+ 2.2%

 

Year	GDP Per Capita (USD)	Difference	Percentage Change
2011	53,117
2014	56,284	+ 3,167	+ 6.0%
Average Difference Per Year (Over 3 years)		+ 1,056	+ 2.0%

 

The main difference between the two tables is the denomination of the currency. The first table is denominated in Singapore Dollar (SGD), while the second table is denominated in US Dollar (USD).

The comparison is important, because a government can always artificially increase GDP of its country by printing and introducing more money into the economy to bring up the GDP figures.

In our comparison, the percentage changes remain quite similar, both in terms of SGD and USD. Hence, it’s fair to say that the growth over the past few years have not come at the expense of a weakening SGD.

Our 5-year growth from 2006 to 2011

Year	GDP Per Capita (SGD)	Difference	Percentage Change
2006	53,355
2011	66,816	13,461	25.2%
Average Difference Per Year (Over 5 years)		2,692	5%

Year	GDP Per Capita (USD)	Difference	Percentage Change
2006	33,580
2011	53,117	19,537	58.1%
Average Difference Per Year (Over 5 years)		3,907	11.6%

The growth shown in the statistics, especially in USD, jumped out at us. A large part of the reason is due to the appreciation of the SGD against the USD, going from USD/SGD 1.6 in 2006 to about USD/SGD 1.25 in 2011. Even if you ignore that, a 5% year-on-year GDP increase is still pretty impressive.

What Does All This Means To The Singapore Voter?

The economic growth in Singapore over the past 4 years has certainly slowed, compared to 5 years before. This is inevitable, seeing as we already have one of the highest GDP Per Capita in the world.

If you are a voter who treasures GDP Per Capita over everything else, then there is little doubt which political party you would prefer. The current Government has an impeccable track record of delivering growth when it comes to GDP Per Capita. And if that’s your cup of tea, then you should stick to the saying of “why fix something when it isn’t broken…yet.”

Your country, your choice, your vote.

This is the 2nd article in a series of 8 articles that will discuss Singapore’s economic indicators to help voters make an informed decision in the upcoming election. DollarsAndSense.sg is neither affiliated with any political party nor a political website.

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Original Photo From Benjamin Lim.

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