In Singapore, we have developed our own way of celebrating National Day. We don’t hold a parade and functions on just a single day. In fact, we mark National Day with all kinds of activities for the whole month of August.

So far, I have attended National Day functions organised by grassroots organisations in Ulu Pandan and Kebun Baru, as well as the NTUC FairPrice and the Singapore Lorry Owners’ Association. Just this morning, I addressed the National Day Observance Ceremony organised by the Staff Union of NTUC Administration and Research Unit. My fellow MPs are kept just as busy in the month of August.

Why this spate of activities? It is very simple. We want all Singaporeans to be involved. So what better way than to have dinners or lunches where masses of people can gather to rededicate themselves as Singaporeans, ever ready to defend our independence and our way of life.

Today, our economy has been affected by the regional crisis. Today, we also find ourselves the target of attacks over the way we do things in our own country.

I recall that during the 1985-86 recession, we also had problems from a neighbour - over the visit by President Herzog of Israel. We were told that we should have consulted our neighbour first, and get their consent, before allowing the Israeli leader to pay us a visit. Today, we are told that we should not have moved our CIQ to Woodlands, without the consent of our neighbour. And once again, we hear calls for a cut in water supplies, and a freeze in bilateral relations.

In other words, we still have to contend with historical baggage. So it was good to have launched National Education so that our students get a better perspective of how we came to be what we are today. Soon, we will have the privilege to have a keener insight into events that have shaped our lives - from no less a personality than Senior Minister Lee Kuan Yew.

After separation, we had to quickly build up our national unity, our economy, our defences and our infrastructure. If we had failed in any of these tests, we would not today be holding celebrations to mark the 33rd year of our independence.

We had our fair share of challenges. We took them at our stride, and succeeded in overcoming many of them.

We attracted investments and created jobs. We invested heavily in building homes, schools and hospitals. We built a world-class infrastructure, in our airports, seaports, and telecommunications system. In 33 years, we have transformed Singapore. To many foreigners, Singapore is a developed country. But we know that we have yet to attain that status.

Today, we face the biggest economic challenge since independence. We have been affected by the recession in East Asia, especially in our neighbours. This current economic recession in East Asia marks another key milestone in our coming-of-age.

When the financial crisis first hit the region last year, many were certain that with our sound economic fundamentals, Singapore would be able to sail through the crisis.

Today, we are more realistic. We now have a better picture of how closely our economy is linked to that of the region. While our economy grew 3.8% in the first half of this year, the second half will not be as good. In fact, the next two to three years will be difficult. The problems facing East Asian countries are not easy to solve. Until they recover, our economy will also slow down. We expect to grow only at between 0.5 per cent to 2.5 percent in 1998. Some analysts expect negative growth.

The present downturn is fundamentally different from the 1985/86 recession. Our costs were high. We had priced ourselves out of the market. Therefore, we took decisive action to reduce costs of doing business here. And we recovered quite quickly.

This time round, we faced two key problems simultaneously. First, we are affected by falling external demand. Second, business costs have increased because our currency has become relatively more expensive, compared to our neighbours.

Therefore, attracting foreign investments is tougher. Owing to their economic difficulties our neighbours are buying less from us and from the rest of the world. Our manufacturing exports are cut. And our hub services, for example, in transportation and in business services, are affected. Fewer of our neighbours can afford to take holidays in Singapore. This affects our hotels, our shopping centres, and our restaurants.

Can we overcome these difficulties?

Much have been said about what we have to do, the actions we have to take.

Tonight, I wish to highlight the intrinsic - what we have to be. There are some intrinsic qualities that we have as a people that will enable us to succeed in our action plans.

First, we will have to stay UNITED. We see many examples of how societies break up when they are put under great stress. So there is no alternative to being united in our common purpose to build a better life for ourselves, and for our children, here in Singapore. United in our will to find solutions.

Second, we have to continue to be PERSEVERING. Let us not be deterred by the odds, the challenges, the threats. We can overcome problems if we adopted a ‘can-do’ and ‘never-say-die’ attitude. Let us remain optimistic, positive, and ready to bounce back.

And third, we have to become more ADAPTABLE. We must find new methods to cope with new challenges. We must all the time question our assumptions, adjust our expectations and change our mindsets. For example, we will not die of thirst, if we are prepared to pay the cost of recycling water and converting sea water into fresh water. These are proven technologies, used for many years in other countries. And the good news is: the cost of recycling water and converting sea water to fresh water is falling all the time. One day it may be so cheap we, too, can afford to bathe twice a day!

Many of us have been to the National Education Exhibition, The Singapore Story. One key message is the future is in our hands.

If we stay united, persevering and adaptable, we are more able to bring about a future that we want. We will be able to overcome the challenges ahead. And emerge as a stronger and more resilient nation.