SINGAPORE'S small community of economists are cheering the slower growth of the city-state's gross domestic product (GDP). Government figures give reason for optimism about strong asset values in Singapore in both the short term and the long term. GDP grew 7.2 per cent in the first quarter on an annualised basis, a drop from 8.3 per cent in the previous quarter. Among the most interesting comments came from Smith New Court regional economist Chan Kok Ping. In the short term, Mr Chan said, an expected decline in growth of unit labour costs (ULC) should help the stock market to pick up value. In a study of past trends in labour costs in Singapore, Smith New Court found that every one per cent increase in ULC shaved off three per cent from earning-per-share growth in Singapore stocks. Even if the one-off factors cited by the ministry for the first quarter's slowdown corrected themselves later this year, Smith New Court expected external demand to taper off in the second half. Mr Chan said that ULC had peaked and would now follow GDP on a downward growth trend. He said similar adjustments in 1992 foreshadowed the 1993 bull run on the Stock Exchange of Singapore. In the longer term or the next 10 years, Mr Chan said, the Singapore economy would develop a structural current account surplus. For the first three months of the year that surplus was an unprecedented S$6 billion (about HK$33.12 billion). Mr Chan said the surplus was due to structural factors similar to those in South Korea and Japan. Most importantly, all three countries had populations of working age. Singapore had also completed most of its major infrastructure investments in housing, ports and roads. Malaysia, with its youthful population and enormous infrastructure needs, was the obvious contrast. It had a structural current account deficit. The continuing inflow of money into Singapore, Mr Chan said, would keep asset values (stocks and property) high and interest rates low until the population grew older in about 10 years.