The resignation takes effect on Thursday, when Lee, 52, is to be sworn in at the Istana state complex as Singapore's third prime minister since the island became independent in 1965 after leaving the Malaysian federation.

Goh, 63, took over in 1990 from Lee's father Lee Kuan Yew, who will turn 81 next month. Both have been asked to stay in the cabinet as part of Singapore's tradition of orderly renewal in a region known for its volatile politics.

Two hours before Goh called on the president, the government announced robust growth figures for the second quarter and revised its 2004 gross domestic product estimate to 8.0-9.0 percent, which will make Singapore one of the Asia-Pacific region's best performing economies this year.

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