Singapore PM says to stem flow of foreign workers

SINGAPORE (Reuters) - Singapore will restrict the flow of foreign workers as the global economic recession hits the city-state's robust growth, Prime Minister Lee Hsien Loong said.

Singapore's annual economic growth slowed to just 1.1 percent in 2008, compared to around 8.2 percent between 2004-2007. The unemployment rate hit the highest level in five years for the export-dependent economy.

"We will not continue to admit people at this pace," Lee said in a speech to students at Nanyang Technological University on Tuesday. "We cannot expect to continue booming as in the last few years."

More than 100,000 foreign workers arrived in Singapore every year in the last few years as the economy boomed, taking the total number of foreigners to almost 1 million, Lee said.

Temporary residents and non-Singaporeans who take up permanent residency make up about 35 percent of the country's 4.84 million population.

There was a need to be "mindful of how quickly our society can absorb and integrate these new arrivals," he said.

The government has said it wants to raise long-term growth by increasing the population by 35 percent over the next 40-50 years through immigration, but locals fear that would intensify competition for jobs.

Singapore's gross domestic product (GDP) grew a seasonally adjusted, annualised 20.7 percent in the second quarter, turning around after four consecutive quarters of decline.

The government, however, expects GDP for the whole of 2009 to contract by 4 to 6 percent.

In the long term, Lee said Singapore would need both foreign workers and immigrants as they take up jobs that are unpopular with Singaporeans. Foreigners also help boost birth rates.

Most Singapore citizens are descendants of immigrants who came from China, India and the Indonesian island of Java at the turn of the 20th century.