I am very happy to be here this evening to celebrate the new year with you, in your brand new living environment.

It was not too long ago in 1997 when the SERS was offered for your old flats in Avenue 3 in Ang Mo Kio. Your response was positive. 86 percent of households took up the offer of new replacement flats at this site. I believe you made the right decision. Today, the benefits of the scheme have become a living reality. You are all proud owners of beautiful new flats, representing the latest range of HDB flats and are comparable to those in the newer towns.

The benefits of the SERS extend beyond your home and family. Through SERS, HDB can build more new homes in mature estates like Ang Mo Kio. Residents often come to ask me if they can buy flats in Ang Mo Kio. They don�t want to move out to another new town, further away from their parents and friends. With SERS, more of them will be able to buy flats here.

On top of these upgrading projects, Ang Mo Kio town, as a whole, is undergoing Estate Renewal. By 2006, we will have a new $200 million Town Centre that is being jointly developed by NTUC and the Singapore Labour Foundation. It will include condominiums, offices, a new bus interchange, and a 5,600 square-metre NTUC hypermart.

Residents of Ang Mo Kio will therefore enjoy the best of both worlds. You will have all the brand new facilities of a new town. You don�t have to leave your friends and neighbours behind, or your favourite char kway teo and mee rebus stalls. The SERS and other programmes like MUP and IUP, all share an important aim � to preserve and enhance the family, social and community ties built up over the years, that make HDB towns good places to live.

This is particularly important now, after the recent discovery of the terrorist plot by the Jemaah Islamiyah group, linked to the Al Qaeda network, to bomb various targets in Singapore. Had the group succeeded, and Singaporeans been killed and injured, it would have caused serious damage to our racial and religious harmony. It would have sown deep suspicion and distrust between the Malay/Muslim community and other Singaporeans. Fortunately they failed.

Fortunately also, Singaporeans have reacted rationally and calmly to the discovery. Malay/Muslim leaders and community organisations have come out promptly to condemn strongly the terrorists. They also repudiated the extreme views of Zulfikar Mohamad Shariff of the Fateha group, defending the plotters and supporting Osama bin Laden. This has helped to show Singaporeans that the vast majority of Muslims here are moderate, rational citizens, and that the Muslim community does not condone or sympathise with the radical minority.

Non-Muslim Singaporeans in general have also responded rationally. In America, Britain and even Australia after September 11, many cases have been reported where people of Muslim or Arab appearance were verbally abused and physically attacked. But in Singapore our multi-racial, multi-religious harmony remains intact.

But do not think that the problem has gone away permanently. The global war on terrorism will go on. Malaysia and Indonesia are also tackling extremist groups out to destabilise their countries. So is the Philippines. Our people have many contacts with their peoples � Singaporeans travel there easily, and their citizens often visit us here. The JI group had links with Malaysia and Indonesia. So we should not be surprised if new groups form here, and hatch new plots to attack targets and endanger innocent lives.

We must be vigilant and prepared. In our community, and in our personal lives, we must make an extra effort to reach out across racial and religious lines, to further build confidence and trust between the ethnic groups. Muslim Singaporeans have made clear that the JI group is an extremist minority, which the community repudiates. So too non-Muslim Singaporeans have to show that they continue to trust their Muslim fellow-citizens, and do not think of every Muslim as a potential terrorist.

This calls for more interaction and person-to-person contacts between Singaporeans of the various ethnic groups. All of us must have more friends of other races and religions, as colleagues working together, friends who go out and play together, or neighbours who keep an eye on one another�s homes. The more we can do this, the more we will understand each other, and the less misunderstanding and mutual suspicion there will be.

Our community activities are opportunities for residents of all races and religions to come together and get to know one another better. We will organise more such activities over the year. I hope you will come and support them, and by participating in a fun activity strengthen our bonding and social cohesion.

Last year was a difficult year for Singapore. Going ahead, we face many challenges. Maintaining our racial harmony is one of the most critical. But we have good reason to be confident. Let us work together as one united people, regardless of race, language or religion, to build a Singapore we can all be proud of and call our home.

I wish you all the best in your new homes.