Singapore is already one of the world's most expensive places to drive and own a car, and things are set to get tougher from 2018.

Starting in February next year, the small city-state at the tip of the Malaysian peninsula will reduce the permitted annual growth rate of its passenger car and motorcycle population from 0.25 per cent to zero.

It will continue to allow the commercial vehicle population to grow at a rate of 0.25 per cent per annum until 2021, in an effort "to provide businesses more time to improve the efficiency of their logistics operations and reduce the number of commercial vehicles that they require".

The Land Transport Authority (LTA), which manages the country's roads and public transport infrastructure, says it's making the change due to "land constraints and competing needs", which mean there is "limited scope for further expansion of the road network".

According to the LTA, 12 per cent of the city-state's land is taken up by roads. The authority says over the next five years it will invest S$20 billion ($18.8 billion) in new rail infrastructure, S$4 billion ($3.8 billion) rail upgrades, and further S$4 billion ($3.8 billion) in bus subsidies.