Prime Minister Goh Chok Tong of Singapore has said he will step down when the economy recovers from a downturn caused by the SARS outbreak.
Goh, the city-state's second leader after founding premier Lee Kuan Yew, named as his successor the current Deputy Prime Minister Lee Hsien Loong. Lee is also finance minister, chairman of the central bank and the eldest son of Lee Kuan Yew, who was prime minister when Singapore separated from Malaysia in 1965.
"Ideally I would like to give my successor at least two years to establish himself as prime minister before he fights the next general election," Goh said on Sunday in an annual speech to the nation known as the National Day rally.
"But I am not stepping down yet. My immediate priority is to get Singapore out of the economic gloom," he said.
Singapore, one of Asia's fastest growing tiger economies, has been rocked by two recessions since the Asian financial crisis in 1997-98, and was hit this year by SARS, which led to the sharpest economic contraction on record in the second quarter.
Some 33 people in Singapore died from the virus, which killed more than 800 worldwide. The illness also hit the economy hard, with the service sector worst hit as tourists stayed away and local people stayed at home.
The economy contracted in the second quarter of 2003 against the first quarter at a seasonally adjusted and annualised rate of 11.4%.
Goh said at the last general election in November 2001 that he would step down before the end of the current five-year term.
"Loong's public persona is that of a no-nonsense, uncompromising and tough minister. Singaporeans would like Loong to be more approachable"
Goh Chok Tong, prime minister of Singapore
A cabinet reshuffle, which took effect this month, and signs of recovery after the SARS outbreak have fuelled talk that 62-year-old Goh - who has been prime minister since November 1990 - might be nearing the end of his stay at the top.
Goh said he picked Lee Hsien Loong, 51, after consulting with ministers and members of parliament. But in a frank admission of his successor's shortcomings, Goh said he knew some Singaporeans were uncomfortable with Lee Hsien Loong's leadership style.
"Loong's public persona is that of a no-nonsense, uncompromising and tough minister. Singaporeans would like Loong to be more approachable," he said.
Licence to chew
Singapore, facing intense pressure for investment from emerging China and India, needs to restructure by cutting wages and pension savings to keep business competitive.
"For every one manufacturing worker hired in Singapore, a company can hire three in Malaysia, eight in Thailand, 13 in China or 18 in India," Goh said.
The prime minister also planned to change Singapore's image as a nanny state and make the island less "strait-laced". The government has recently changed laws to allow 24-hour alcohol licences, dancing on bar tops as well as bungee jumping, and said the public sector would hire gays.
A decade-long total ban on chewing gum has also been overturned, but restrictions remain: "sugarless gum prescribed by doctors and dentists as having therapeutic and medicinal benefits will be sold in pharmacies," the government announced last month.
"Now we will give greater room for experimentation. Increasingly, it will be 'everything is allowed unless we say it is not' ... well, almost everything," Goh said.