SINGAPORE has to revisit the growth strategy it used after its independence in 1965 -- leapfrogging the region and reaching out to the developed countries -- said Senior Minister Lee Kuan Yew Dec 8.

Speaking at a luncheon organised by the Singapore Chamber of Commerce in Hongkong, SM Lee pointed to the several Free Trade Agreements which Singapore is forging with countries outside the region.

"Whilst Asean is taking its time trying to stabilise itself, we have to diversify our markets and our links. And having done that, then help our neighbours to come back to normalcy and to get Asean going. It may take some time, but I believe it will happen," he told over 400 business leaders, bankers and overseas Singaporeans.

This strategy is similar to the one Singapore used after independence in 1965, he said. "We leapfrogged. It was a secret then, but it's not a secret now that our strategy was to leapfrog the region, reach out to the developed countries, get their companies to manufacture in Singapore, do their services in Singapore and re-export to the world. It succeeded and we prospered."

Now, Singapore may have to do the same for the time being, he said. "You will notice that my Prime Minister has signed a Free Trade Agreement with New Zealand, is signing one with Australia, one with Japan, one with Chile and one with the US."

Asked to compare the situations of Hongkong and Singapore, SM Lee said: "We are in two entirely different situations. For the immediate future, I think you are better placed because you've got a booming hinterland."

Hongkong will increasingly become part of the "economic milieu" of China, he noted. "Because they are going to prosper, you are going to prosper. That is your good fortune. But of course, if they don't prosper, then you are in trouble."

In contrast, he said, "my surroundings are less buoyant, in fact, in some areas, somewhat troubled". But he noted that Singapore has been through this before and said that it will be able to help its neighbours and get Asean up and running again. "But in the meantime, if you ask me, you have an easier task than I have."