With Singapore?s economy on the mend, speculation is growing that long-serving Prime Minister Goh Chok Tong will bow out on a high and hand over to his deputy Lee Hsien Loong sooner than expected, possibly in the next few months.

The 51-year-old Lee, eldest son of the island state?s founding father Lee Kuan Yew, has waited in the wings as the economy almost stumbled into recession, hit hard by the SARS epidemic last year.

Goh said some time ago he wanted to give Lee two years to settle into the top job before general elections due by 2007.

But in December he dropped broad hints of an early exit, saying he would be comfortable handing over if the economy grows three to four percent, and that he would make an announcement after March.

That target now seems to be within easy reach. Figures released last week showed the economy expanded 3.7 percent in the fourth quarter of last year compared with a year earlier.

?This year is probably ideally suited for PM Goh to step down and hand the so-called reigns over,? said Song Seng Wun, regional economist at G.K. Goh Securities in Singapore.

Some pundits expect to see the younger Lee, anointed as successor in August by the ruling People?s Action Party, to preside over National Day celebrations on August 9.

Seah Chiang Nee, a political commentator and former Singapore newspaper editor, said he ?wouldn?t be surprised? to see a switch before National Day. ?I?d expect Goh to remain in the cabinet and the process should be very smooth,? he said.

Local media reports are also playing up a 2004 leadership transfer, which will be only the second in Singapore since the elder Lee spearheaded independence from Malaysia in 1965.

The Straits Times newspaper, in a report last weekend headlined ?A handover on the cards??, said ?the stars seem aligned for a changeover to happen this year?.

Goh, once written off as a mere seat warmer for the Lee family, remains immensely well-liked by ordinary Singaporeans after a 13-year tenure. His avuncular style has helped his ministers administer harsh medicine such as wage cuts despite rising unemployment.

<B>Lee?s softer side</B>

The younger Lee, like his father a stern authoritarian figure who rose to brigadier general in the Singapore armed forces, will have trouble measuring up in terms of popularity.

Goh admitted as much in August when he said Lee has to learn ?to let his softer side show.?

Since then, newspapers have printed stories and photo essays depicting the private, gentler side of Lee, including his musings on love.

?There?s no meaning if you say you?re in love with someone one day but not the next?, he told a recent interviewer.

Lee Hsien Loong has also been positioning himself as a champion for a more open society which the government recognises is needed to foster a more dynamic and entrepreneurial economy. Early signs that straight-laced Singapore is loosening up include a relaxation of bans on bar-top dancing and bungee jumping.

?I have no doubt that society will have to open up further?, Lee said in a speech.

<B>Some pundits skeptical</B>

Seah said Goh also hinted at an early succession in an October interview with the Bangkok Post, which quoted the prime minister as saying he would ?phase out? himself before 2005.

Some reckon Singapore?s economy could expand as much as six percent this year as global sales of semiconductors, which power the vital electronics sector, lift off. Growth was less than one percent in 2003, among the slowest in Asia.

But analysts say there are plenty of caveats that could keep Lee, who is also central bank chief and finance minister, playing second fiddle this year.

A SARS crisis similar to last spring?s outbreak of the virus that killed 33 people in Singapore, could delay a succession, as could extremist violence at home or in the region.

But barring an economic shock, Song said an announcement could come ?somewhere in the beginning part of the second quarter at the earliest?, possibly after advance estimates on first quarter economic growth are released at the end of March.

?I don?t think it?s so imminent,? said P.K. Basu, managing director of Robust Economic Analysis.

?He (Goh) has made it very clear that he sees it as his responsibility to ensure that the economy has fully recovered. The economy is now in the early stages of recovery.?

Jason Szep

Goh, once written off as a mere seat warmer for the Lee family, remains immensely well-liked by ordinary Singaporeans after a 13-year tenure. The younger Lee (...)will have trouble measuring up in terms of popularity.