If you thought 2016 was a difficult year, don't hold your breath for things to get better this year. The consensus among many, going by the latest business survey, is that it will get even tougher.

Economists forecast the Singapore economy to grow by 1-3 per cent this year, after growing by less than 1.5 per cent in 2016.

This means another year of slow growth - that's new territory for Singapore which it has never been before. In previous years, when the economy was depressed, it almost always bounced back, sometimes spectacularly, the next year or, at the most, the following. It has never experienced more than two years of sluggish growth. Even more worrying is that no one can say when the turnaround might happen.

You may think it is to be expected that growth will slow down when an economy matures, as it has for many of the advanced countries, including Japan, South Korea and most of Western Europe.

But that's dangerous thinking because the Singapore economy isn't as developed as these other countries. It does not have the same level of manufacturing or engineering capabilities, or have comparable number of home- grown world-class companies. It doesn't even have a single Nobel Prize laureate. The depth of talent and experience isn't there across the economy.

If indeed low growth is the new reality, the slowdown is happening much too prematurely here.

There is another reason why slow growth cannot be the new normal, not yet anyway: Singapore is a city state and cities are expected to grow at higher rates than countries with vast rural areas, or they will not be able to attract the talent and resources necessary to sustain vitality.

The likes of London, New York, Shanghai and Tokyo are places where things happen because like-minded people are attracted there.

Those who prefer a slower life move into smaller towns and the countryside. But in Singapore, the city is the country and it has to take care of everyone, the edgy as well as the less able. This is the dilemma of a city state: How to grow vigorously when not everyone will be able to keep up with the competition.

Singapore's economic challenges are hence not just cyclical and a result of the slowing global economy but have to do with more strategic questions about how it positions itself during the transition to a more developed economy.

Ultimately, it is about what Singapore wants to be and what role it sees itself playing in the global economy. It requires a clearer vision of its identity and where it wants to go.

On the international front, the challenges facing a small country like Singapore have mounted. US-China relations have entered a new period of uncertainty with President-elect Donald Trump's victory. The demise of the Trans- Pacific Partnership, a free trade agreement that was supposed to anchor the US in the region, has raised fresh questions about American commitment.

All this is happening as China's growing strength shifts the balance of power in the Asia- Pacific. Already Asean countries have altered their positions as they adjust to the new power's growing influence. Singapore will find the changed geopolitical landscape a testing time for its political and diplomatic skills.

Is there no silver lining in the gathering of these darkening clouds?

I can think of one and it could be a godsend.

It has to do with how Singapore responds to the difficulties ahead. One reason why there is growing concern about its ability to overcome them is that the country itself is changing on many fronts.

An entire generation has grown up amid peace and plenty and take much of the progress for granted. Younger Singaporeans have had no experience of the early struggles and sacrifices their parents had to make to overcome the odds.

Would they have the mettle and wherewithal to succeed if the going gets tough? Are they hungry enough to put in the extra effort that is needed to make Singapore exceptional again?

The same question could be posed to the political leadership, especially the generation that is due to take over. The younger leaders too have had no experience with the early years of the country's struggle for independence or been tested fully on their ability to lead in testing times. Do they have the political skill and gumption to get Singapore out of trouble should the need arise and be able to inspire and mobilise the population?

There are no easy answers to these questions, no way of knowing how it might turn out.

Enter the challenges ahead that threaten to darken the Singapore sky.

How Singapore responds, both leaders and the people, will provide part of the answer. It is said that countries which have had to overcome severe shocks from time to time develop the instincts to survive, out of which emerge a stronger sense of community. The Japanese are known for their resilience, having to cope with regular natural disasters, the Jews built theirs from living among hostile neighbours, the northern Europeans from their harsh climate.

Singapore? If you were critical, you might say the instincts that have developed over the last few decades were flabby ones, shaped by years of stability and abundance and from having an overly-protective government which took care of most things.

A period of severe challenges, hardship even, and uncertainty about the future might be just what is needed to change mindsets and attitudes and develop stronger survival skills.

It would be a good test for the leadership and an opportunity to develop their thinking about what Singapore is, and where it wants to go, and to share them with the people.

If successfully done, it will deepen their relationship with Singaporeans. In turn, the people will get to know their leaders better. But they should be encouraged too to contribute their ideas and to play a part in the search for answers. It shouldn't be a top-down effort - that would be a wasted opportunity.

But for the experience to yield real lasting effects, to alter the DNA in a significant way, the period will have to be long and testing enough. As the saying goes, no pain, no gain.

Will Singapore become stronger as a result, or weaker, unable to cope with the pressure?

I know you shouldn't wish for a crisis. But if it has to happen, you have to make the most of it.

Happy New Year.

•The writer is also a Senior Fellow at the S. Rajaratnam School of International Studies, Nanyang Technological University