Mr Goh will remain in the cabinet as senior minister

Mr Goh is making way for Lee Hsien Loong, 52, the elder son of the island-state's founding father, Lee Kuan Yew.

"Planned, orderly transition is what distinguishes Singapore," Mr Goh said in a televised farewell address.

Lee Hsien Loong will be sworn in on Thursday, but he has already named his new cabinet, giving his father the title of Minister Mentor.

Mr Goh will also stay in the limelight, taking the elder Mr Lee's title of Senior Minister, as well as becoming chairman of Singapore's central bank.

Lee Hsien Loong will retain his current job of finance minister.

Some analysts had expected 52-year-old Mr Lee to usher in a new generation of younger leaders.

Mr Lee has been deputy PM since 1990

He has previously spoken of the need for Singapore to shake off its reputation as an over-protective, nanny state.

But his chosen cabinet contains few new faces, with most of the changes being job swaps between existing ministers.

The younger Mr Lee, who is seen as strict and rather humourless, secured a first in mathematics at Cambridge University, then joined the military, quickly rising through the ranks to become brigadier-general.

His military career ended at the age of 32, when he followed his father into politics as a member of the ruling People's Action Party.

He was appointed deputy prime minister in 1990, at the age of just 38.