Singapore: Sing-apore's economy expanded less than previously estimated in the first half of 2010 and growth may "moderate" in the coming months, Prime Minister Lee Hsien Loong said.

The Southeast Asian nation's gross domestic product rose 17.9 per cent in the six months through June from a year earlier, Lee said in a televised National Day message in Singapore Sunday. That compares with a record 18.1 per cent pace reported in July. The economy may grow 13 per cent to 15 per cent in 2010, Lee said, reiterating an earlier forecast.

The island is in the running to be the world's fastest-growing economy in 2010 as it celebrates the 45th year of independence today with a parade of tanks, artillery and fighter jet displays. The expansion is part of an Asian rebound that has prompted South Korea, Malaysia, Taiwan and India to raise interest rates and Singapore to revalue its currency, even amid concern Europe's debt crisis may impair global growth.

"Risks remain in the world economy, especially in Europe and the US," Lee said. "The global financial system is not fully mended. If the world economy turns bad, we will be buffeted. We need to stay vigilant and watch the developments worldwide."

Singapore's economy grew an annualised 26 per cent in the second quarter from the previous three months as tourism and exports surged, according to initial government estimates released on July 14. The median forecast of seven economists surveyed by Bloomberg News is for a 25.2 per cent expansion.

Data

The trade ministry will release updated GDP data tomorrow.

A year after Singapore exited its worst recession since independence in 1965, tourists are arriving in record numbers and companies including Standard Chartered are boosting hiring.

The city state added an estimated 26,500 jobs in the three months ended June, after the creation of 36,500 positions in the first quarter, according to the Ministry of Manpower.

Monthly tourist arrivals in Singapore exceeded the one million mark for the first time in July. Efforts to boost tourism include hosting the Formula One night race, which will take place in September for the third year in Singapore.

Strategies

A government-appointed panel earlier this year unveiled strategies to help the city state grow at a sustainable rate and faster than advanced economies.

The country aims to at least double its productivity growth to between 2 per cent and 3 per cent annually in the next decade after the rate averaged one per cent in the last 10 years. It has raised levies on foreign workers to reduce companies' reliance on cheap imported labour.

Prime Minister Lee said at the end of 2009 he would "moderate" the inflow of foreign workers so that citizens aren't "overwhelmed".

Foreign workers

In July, he said Singapore would need 100,000 more foreign workers this year to cool an "overheating" labour market.

An Institute of Policy Studies survey released this month shows six out of ten Singaporeans say national unity will be affected by the government's policy to attract foreign talent.

Among the 183 economies for which the International Monetary Fund has forecasts, only Qatar is calculated to expand faster than the government's forecast for Singapore.