SINGAPORE - Global upheavals have produced grave challenges for Singapore but Prime Minister Lee Hsien Loong is confident the country will overcome them and emerge even stronger.

This ability to overcome the odds is evident in Singapore's history, he said on Thursday (Aug 8), the eve of National Day.

Already, Singapore has taken steps to renew and re-invent itself, he added in his annual address to the nation, delivered against the backdrop of Changi Airport's dazzling Jewel, which he held up as symbolic of the country's spirit to dare do the new - and do it first.

Singaporeans have gone through many ups and downs over the years, he noted.

Today, economic uncertainties, global strategic risks and the existential threat of climate change are the grave challenges confronting Singapore, PM Lee said, adding that it must ready itself for a "very different future".

"But our past gives us confidence. Throughout our history, when trials and tribulations have beset us, we picked ourselves up and worked together to overcome them.

"Each time, we reinvented and renewed our economy, our people and our city, and we thrived again. And this is what we must keep on doing."

Giving an indication of what he will focus on at this year's National Day Rally speech on Aug 18, PM Lee said pre-school and tertiary education will be made more affordable for lower and middle-income families.

The retirement and re-employment ages will be raised to help older Singaporeans who wish to work longer, he added.

While he did not give any forecast of growth figures for the year, he noted that the economy has slowed. (The Government's preliminary estimates put growth in the second quarter of this year at 0.1 per cent).

Elaborating, PM Lee said global demand and international trade have weakened, and this has affected Singapore's manufacturing sector and trade-related services.

In particular, Singapore is feeling the worldwide cyclical downswing for electronics, which performed strongly last year, although other parts of the economy are still doing well.

"We have experienced such slowdowns before, and we will take this one in our stride," said the Prime Minister. "Should it become necessary to stimulate the economy, we will do so."

More fundamentally, the world is entering a more troubled period, he noted.

Trade and globalisation are under pressure and friction between the major powers is growing while global warming and rising sea levels post existential threats.

"Singapore will not be immune to these global problems. On the economic front, they will disrupt supply chains, alter trade patterns and shift investment flows. We must get ourselves ready for a very different future."

PM Lee also noted that although Singapore is commemorating its bicentennial year, its history stretches back to well before 1819 when the British arrived. "Singapore has drawn from many cultures and traditions in our journey towards nationhood. We have gone through many ups and downs."

On the economic front, he said Singapore is making good progress in transforming its industries, and in its efforts to reskill and upgrade the workforce.

Its seaport and airport are being expanded to meet growing regional needs, while the two integrated resorts are being upgraded to attract more tourists.

Also, the tech and start-up scenes are flourishing, with agencies such as Enterprise Singapore helping entrepreneurs and companies strengthen, scale up and expand into the international market.

Meanwhile, the SkillsFuture scheme is helping Singaporeans to be more productive and employable, preparing them for new jobs being created.

"All these structural measures will not only address our longer-term challenges, but also help see us through a more immediate downturn," he said.

PM Lee pledged that the Government will keep on helping citizens to achieve their potential and contribute their best to Singapore.

But he also stressed this is a joint endeavour. "Each one of us must strive to improve ourselves, do our best, and chase our dreams."

Underlining the importance of continuing to renew the city, he recounted what a foreign leader on his maiden visit to Singapore told him recently.

The leader said he knew at once his plane was flying over Singapore "because, looking out of the window, he could see that every corner of the island had been meticulously thought through and lovingly tended - every housing precinct, every landmark, every patch of park and greenery", he said. "The island was a sparkling diamond, with brilliant facets catching the eye."

PM Lee compared Singapore to Jewel, saying the gleaming new complex shows how Singaporeans have the creativity and daring to reinvent themselves, as well as the passion and competence to turn dreams into reality.

"As you might expect, other cities and airports are already planning to emulate Jewel, and perhaps do it bigger and better," he said. "But we dared to attempt the new, and we did it first."

Other projects to remake the city include the upcoming Changi Terminal 5, Tuas Megaport and the Jurong Lake District, as well as the redevelopment of Paya Lebar Airbase and the Greater Southern Waterfront.

All these will keep Singapore busy and create new opportunities for Singaporeans for decades to come, he said.

But, he added: "To stay in front of the pack, we must constantly come up with fresh ideas, always be ready to break new ground.

"What limits our possibilities is not the physical size of our island, but the ingenuity of our people and the boldness of our spirit."

In a spirited call to Singaporeans, he urged them to be as intrepid as the first settlers who arrived here from distant lands, and as tough as the earlier generations who endured war and occupation, rebuilding their lives afterwards.

"Let us be as resolute as the Pioneer Generation who fought for independence and founded our nation, and be as united as the Merdeka Generation who took up the baton and brought Singapore from Third World to First.

"Let us continue to work together as one united people to thrive in an uncertain world, challenge ourselves to explore new horizons, and commit our hearts and souls to Singapore and its future," PM Lee said, wishing Singaporeans a happy National Day.