No debt disaster for Singapore

IN recent years, there have been many concerns expressed in the media about the level of debt in Singapore, especially for mortgage and credit-card borrowings. These critiques have relied on a few different ways to measure debt, but most have arrived at the same conclusion that Singapore's households have a debt problem or are on the way to one.

Some have taken Singapore's gross debt-to-GDP (gross domestic product) ratio and compared it to that of other countries. For example, if the United States had a gross household debt to GDP ratio of about 100 per cent in 2007 when the subprime debt crisis broke, then Singapore - where the ratio is 75 per cent and rising - must also have a debt crisis brewing, they say.

Others have raised the alarm based on concerns that Singaporeans' personal debts are growing faster than the overall economy, while personal bankruptcy filings and the loan default rate are also rising.