THE average growth rate for Singapore over the next 10 years will be slower than in the past, said Finance Minister Tharman Shanmugaratnam.

This is a result not only of the global economic crisis, but also because of changes in Singapore's economy, he said in an interview with the Financial Times (FT).

"You can't keep growing at 5, 7, 8 per cent over the next five to 10 years; and it is not advisable to either," said Mr Tharman.

Growth had averaged 5 per cent a year over the last full economic cycle from 2003 to last year, the minister said.

But he would not discuss the exact level at which Singapore's long-term growth trend might settle, except that it was expected to be "a shade lower than over the last five to 10 years", FT reported.

As Singapore becomes a high-income economy, it faces the difficulty of maintaining high rates of productivity growth, said Mr Tharman.

Other constraints on the country's economic growth include a falling birthrate and its impact on labour-force growth, he told FT.

The global financial crisis has resulted in the worst recession that Singapore has seen since independence.

It suffered four quarters of sequential decline, during which the economy lost 9.7 per cent in output - the deepest recession on record.

Gross domestic product surged by an average of 18.5 per cent on-quarter only in the second and third quarters of this year.

The International Monetary Fund expects the economy to contract by 1.7 per cent this year and expand by 4.3 per cent next year.

In his interview with FT, Mr Tharman said that the likely reduction in trend growth was due mainly to Singapore's successful economic transformation.

"This is not so much due to the crisis and the very real discontinuities in the global economy as much as the fact that the Singapore economy is evolving," he told FT.

"These are stylised facts that describe what happened to Europe beyond the tremendous recovery after the war, what happened to Japan, what happened to every other advanced economy," he added.

However, Singapore is still growing at a trend rate that is "faster than advanced economies with a similar per capita economic level", the minister said.

When compared to other economies in the same league, Mr Tharman thinks that Singapore can still grow "significantly faster".

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