commentary 2011

1COMMENTARY VOLUME 24, 2015 SINGAPORE @ 50: REFLECTIONS AND OBSERVATIONS

Commentary:Volume 24, 2015Singapore @ 50: Reflections and Observations

Editor: Associate Professor Victor R Savage

Published byThe National University of Singapore Society (NUSS)Kent Ridge Guild House9 Kent Ridge DriveSingapore 119241

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ContentsTribute5 Lee Kuan Yew (1923-2015):

Mentor, Sage and PoliticalPhilosopherVictor R Savage

Editorial6 - 14 Singapore@50: Reflections

and ObservationsVictor R Savage

Infrastructure15 - 21 Singapore has become a City

for Cars, not PeopleBruno Wildermuth

22 - 28 An Extraordinary Journey:50 Years of Urban Planningin SingaporeMieko Otsuki

Social Issues

29 - 37 Singapore In Transition:Staying Together For TheNext 50 - Reviving theNational LanguageYang Razali Kassim

38 - 46 Social Participation in a NewSingaporeHo Kong Chong,Hasliza Ahmad, Helen Simand Ho Zhi Wei

47 - 53 Singapore: Condemned toChange?Rodolphe De Koninck

Poem54 - 55 Honour

Edwin Thumboo

Singapore Economy56 - 78 Singapore’s Economic

Development, 1965-2020:Review, Reflection andPerspectiveTan Khee Giap,Evan Tan Beng Kai andVincent Kwan Wen Seng

79 - 85 Development of Singapore’sFinancial SectorPiyush Gupta

86 - 93 The Hub Concept -Reflections on the Past,Projections for the FutureJoergen Oerstroem Moeller

Security & Defence94 - 100 50 Years of Singapore’s

Securitisation: Prospectsand ChallengesBilveer Singh

External Relations101 - 108 Building on a Foundation of

Constructive Indonesian-Singapore RelationsMohammad Amien Rais

109 - 116 50 Years of Singapore’sConnections with EuropeYeo Lay Hwee

117 - 123 Singapore and SoutheastAsia: A Shared History anda Shared DestinyTan Tai Yong and Soh Yi Da

4 COMMENTARY VOLUME 24, 2015 SINGAPORE @ 50: REFLECTIONS AND OBSERVATIONS

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Mission StatementTo foster a lifelong relationship with NUS and the wider graduatecommunity

At NUSS, a lifelong relationship with NUS and the wider graduatecommunity is achieved through two mutually reinforcing thrusts:

• promoting the interests of its members and NUS; and

• contributing positively to Singapore’s political and intellectualdevelopment and helping to cultivate a more gracious social andcultural environment.

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A Tribute to Mr Lee Kuan Yew(1923-2015): Mentor, Sage andPolitical PhilosopherAs with every Singaporean, the NUSScommunity and the Editorial Board ofCommentary share the profound griefat the passing of the founder of modernSingapore, Mr Lee Kuan Yew on23 March at 3.18 am.Fondly remembered by members ofthe Society, Mr Lee was conferredNUSS’ Honorary Membership in 2011.His ties with NUS started from hiseducation at Raffles College, thepredecessor institution of NUS in the1940s. Mr Lee then went on to becomea founding Ordinary Member of theUniversity of Malaya Society (later tobecome NUSS) in 1954.Singaporeans can never thank enoughthe contributions, drive, and dedicationthat Mr Lee gave to making his life-longproject a success – the creation anddevelopment of a city-state, theRepublic of Singapore. With tenacity,passion and endless personaldetermination he championedceaselessly to turn Singapore into apeaceful, racially harmonious, anddeveloped country. In a matter of 50years, he gave many Singaporeansnational pride, self-confidence, politicalstability and institutions to face thefuture as a sovereign country. We arethe beneficiaries of his lifelong work.

Until his final journey on 29 March2015, the outpouring of tributeslocally and internationally has beenoverwhelming and touching. Whenwe watched the thousands ofSingaporeans who lined up for hours topay their respects at Parliament House,the thousands who clapped andshouted his name along the cortegeroute, emotion engulfed you. We finallystand together as a nation despite ourvaried political beliefs and racial andreligious differences.Hopefully Mr Lee’s family and friendsfound comfort in seeing so manySingaporeans express their deepestgratitude and holding him in highestesteem. No one ever dreamt that suchnational outpouring of grief and passionwas likely or possible - it demonstratesMr Lee Kuan Yew’s devotion to our city-state did not only go unnoticed but alsohow much it meant to each of us. Hehas become our national icon and hero.Indeed he is the defining figure in ournation’s genesis and hence willcontinue to evoke deep respect in theemerging post-Lee Kuan Yew chapter ofSingapore’s evolving development.Those of us who had lived underhis leadership, encountered him,interacted with him, and accompaniedhim in the turbulent journey tonationhood, can now count ourblessings to have lived within hispolitical aura and be able to tell ourstories and share our anecdotes of hispolitical genius. These will be the seedsfrom whence poetry, legends andmyths will spring to become the stuffof Singapore’s future national identity.

Victor R SavageEditorApril 2015


Associate Professor Victor R Savage (Arts, Class of ‘72) is from theDepartment of Geography and currently the Director of the Officeof Alumni Relations (OAR), National University of Singapore.

Editorial

Singapore@50:Reflections and Obersations

Victor R Savage


Editorial

Singapore@50: Reflections and Observations

Introduction

1965-2015 — Golden Anniversary:The Lonely Planet guide votes

Singapore the best tourist country to visitin 2015 to sample its celebrations. Bycurrent measures and benchmarks ofnewly-formed states to fill the UnitedNations (UN), the Republic of Singapore’s50th anniversary as an independent stateseems like a remarkable achievement.Compared however to the nation-statesof Europe, the City-state’s goldenanniversary celebration covers a shorttime span, a blip in global history.Historically speaking, City-states havenever been sustainable political entities.Athens and Sparta are now part ofGreece, while Venice, Florence andGenoa are part of Italy today. All of them,in a short span of time, were meccas oftrade and sparkling urban political andeconomic entities that have endedunceremoniously. Their apogee ofgreatness continues to be enshrined inbooks, maps, poetry, architecture andpaintings — Singapore is quite theopposite.

Singapore was the capital of a largerpolitical entity of colonial Malaya fornearly a century before it became anindependent autonomous City-state in1965. Its ‘territory’ and administrativejurisdiction was heavily reduced withindependence, its geographical spacetruncated, and its political influence hadto be developed from scratch. This‘accidental’ City-state was given little

chance of remaining independent at itscontroversial birth. Beyond politicalexpectations, it has not only survived asan autonomous City-state, it has thrivedand become a ‘model’ state for otherdeveloping countries to emulate. In otherinternational opinions, Singapore is thebest example of a highly successful start-up country. With ‘venture capital’ fromthe United Nation agencies, governmentsand other corporations, Singapore hasmoved out of the arena of the developingworld and competing alongside thecountries and cities in the developedworld.

Like all success stories, Singapore as aCity-state has become increasingly a casestudy in many developmental narrativesin economics and finance, politicaldevelopment, transport management,environmental management, legalframework, urban planning, ageing,education, governance, conservationissues and leadership training. Every year,for the past 25 years, legions ofdelegations from developing states andcities have come to uncover and discoverthe ‘secrets’ of the City-state’s success.The real Singapore secret is how tomanage diverse factors into a cohesivenational whole. However, this is easiersaid than done.

In this 2015 Commentary, I havededicated the issue to reflections ofSingapore’s achievements and challengesover the last 50 years. In celebrating theCity-state’s golden anniversary, there is


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much for Singaporeans to be proud of butthere is also much to be worried aboutfor the future. Domestically, there ispolitical restlessness on the ground;geopolitically, there are major changesthat have unsettled the order of globalpolitics; the economic exuberance ofthe last 40 years in Asia seems to bewinding down and the threat of climateand environmental change is closingin on countries, cities and societieswith vengeance and no crediblesolutions in sight. These articles reflectboth Singaporeans’ and foreigners’perceptions of the last 50 years of theCity-state’s historical development. Theyshowcase the views of governmentbureaucrats, academics, corporate titans,entrepreneurs, non-governmentalorganisation (NGO) personnel, politiciansand public policy researchers. Enjoy theread.

Singapore’s Recipe: National Ingredients

Singapore is a unique political experimentand it is not easy to replicate its success.The first 50 years of Singapore’s infancyof statehood have been remarkable tosay the least. It also reflects on aremarkable group of like-minded leaderswho steered Singapore through the ColdWar polemics, the Vietnam War and thedomino theory of communist victory inSoutheast Asia, and the challengingproblems of economic development inThird World developing countries. Theview that history repeats itself is notsomething subscribed by most historians,

so no country can repeat its own pastsuccesses or transcribe the same forother countries.

Singapore society today is a sum of 50years of cultural change, politicaltransformations, national aspirations andeconomic calculus. One needs to beginwith fundamentals and that meansseparating society from culture. Whilethere are some elements of culture (e.g.,food, science and mathematicalpedagogical systems) that can bereplicated and transported to othercountries and cities, it is impossible totransport a society with all its societalnorms, cultural entrenchments andpublic behaviour patterns. All societies,including Singapore society, areembedded in a specific time and place.Just by diffusing elements of Singapore’s‘culture’ (e.g., transport or environmentalmanagement systems) in anothernational society will not have the sameresults as Singapore. The management ofsuccess is a more difficult proposition forstates and cities.

Every society is a product of a longhistory of customs, traditions,behavioural patterns, religious beliefs,societal achievement stimuli, ecologicalintelligence and public or personalexpectations. It has taken the WorldBank, in its latest 2014 World BankReport, a rather belated recognition oflooking at behavioural economics(decision-making processes) inattempting to deal with the issue of


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global development and povertychallenges. Everyone knows theimportance of infrastructuredevelopment: more schools, hospitals,irrigation systems, and dams fordeveloping countries — but the driver ofdevelopment has more to do withsocietal software than mere nationalhardware development andimprovisations.

One often forgets the Singapore societalmake up. This was a colonial city-statedeveloped from poor migrants andrefugees of impoverished neighbouringcountries (India, China, Indonesia, SriLanka, Bangladesh, and Pakistan). AfterWorld War II, the countries in the regionsuch as Singapore were devastated andunemployment was rampant. Thepioneer generation of Singaporeansinherited this economic predicament.Hence, older generation Singaporeanscarried a strong personal commitment,passion, interest and verve to succeed inlife.

Some 35 percent of Singaporeans in the1960s lived in slums and squatters andover 60 percent of the island-city’spopulation lived in 1.2 percent of landarea in the city centre. Labour strikes andriots were common. The Cold War(communism versus democraticcapitalism) was unfolding in the streets,in schools and within labour unions ofSingapore. The per capita GNP incomewas S$1,310 or US$428 in 1960 and roseto S$22,000 in 1990 to S$37,000 in 2000

and S$69,000 in 2013. The World Bankput Singapore’s gross domestic product(GDP) purchasing power parity (PPP) percapita at US$78,744 in 2013. By 2023,Singapore would be the ‘Second WealthCentre’ globally after London, accordingto the Bank of Singapore-Knight Frank2013 Report.

The drive to succeed and improve one’slot was in every personal DNA ofSingaporeans — thrift, hard work,diligence, family stability, flexibility andadaptation, entrepreneurship, and afocus for family improvement. The‘pioneer generation’ Singaporeans in the1950s and 60s were poorly educated butit did not stop them from making up withdiligent work habits, willingness to adaptand an eagerness to learn. With meagrefinancial abilities, families enrolled theirchildren in schools and hence, thefoundation of Singapore’s success wasslowly and firmly built. The continuousfocus on education has made Singapore’s‘Thinking Schools, Learning Nation’ amodel for emulation by other countriesand states — today, the nation’s schoolsrank second in mathematics and third inscience and reading globally.

Despite the skeptics who see thegovernment’s ‘pioneer generation’programme as vote buying and politicallymotivated, I do not think anyone canrationally doubt the massive sacrificesand contributions this generation hadgiven to Singapore’s development. Theydeserve the accolades, the subsidies and


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financial help. It is the ‘small people’ orwhat Indonesians call the orang chilik or‘little people’ whose sacrifices deservethe support in their silver years. If thereis one area the Singapore government isfinally contending with, it is with themuch-needed retirement benefits forolder Singaporeans. The government hasdone well in the other social revolutions(health, education and public housing)that has helped close the income gap andsocial inequalities.

What has generally lagged behind isretirement benefits and pensions forolder Singaporeans, an area which thegovernment has thus far avoided with theexcuse that they did not want the socialwelfare systems of Western Europeancountries. However, French economist,Thomas Picketty (2014), accepts thatpensions and retirement benefits arecentral to the fiscal and social revolutionsin capitalism in most western countries— Singapore cannot accept educationand health packages and yet, denypensions as alien to the social compactwith citizens.

Given the negative and challengingpolitico-economic situation in Singapore’searly development, it took a focused,strong-willed percipient, non-corrupt andfar-sighted leadership and government toput the City-state on the right track fordevelopment. There is no need torehearse the tributes to the then PrimeMinister Lee Kuan Yew here — his manyrecent autobiographic and biographical

books are testimonies to his astute anddetermined leadership in movingSingapore out of poverty and on the roadto First World development. The mostrecent testimony to Lee’s national andinternational impact is the tribute hisdiplomats, civil servants and politicianspaid him for his ‘big ideas’ (Jayakumar &Sagar, 2015).

Singapore was also fortunate to havemany cabinet ministers (i.e., Gok KengSwee, S Rajaratnam, Hon Hui Sen, EdwardBarker, Lim Kim San, Toh Chin Chye)during its early years of independencewho were equally intelligent, non-corrupt, competent, grounded, andwho shared a common vision fordevelopment. However, their leadershipand policies could not have been realisedwithout a population eager to improve,willing to progress and a desire todevelop.

Success did not, however, come withoutsacrifice, sidesteps and trade-offs.Cherian George (2000) capturedSingapore’s downside of development inhis book, Singapore: the air-conditionednation. Here, he argues that Singapore isan “air-conditioned nation” — a societywith a unique blend of comfort andcentral control, where people havemastered their environment, but at thecost of individual autonomy, and at therisk of unsustainability” (George,2000:15). The American sociologist,Joseph Tamney (1996), maintained thatSingapore has lost its soul in its


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progressive development. Critics see thegovernment as wittingly feeding theSingaporean material ethos throughgenerous bonuses, cash rebates, financialsubsidies and performance rewards to itscivil servants, politicians and the publicthereby, keeping Singaporeans generallyhappy and cementing the government-citizen bonds over the last 40 years, albeitin a material manner.

Unlike western societies, the roots ofliberal democracy, rooted in personalindependence and individual liberties,sets the Western countries apart fromEast and Southeast Asian politicalentities. If one is to believe Amartya Sen’sthesis of the ‘argumentative Indian’, theroots of democracy are older in India thanin Greece, and hence, one can acceptSouth Asian politics as closer to theWestern political experience than to EastAsia. In short, Sen dictates that Indianphilosophy and religious practices haddemocratic similarities with the GreekSocratic (self-esteem, independence,individualism) tradition. Despite itsdemocratic institutions, Singapore’spolitical idiom for the last 50 yearshowever, followed an East Asianparadigm, closer to a Confucian tradition(Nisbett, 2003) — with an emphasison group-think than individualassertiveness, interdependence, holismperspectives, shared obligations and acollectivist social system.

This Singaporean ‘collective identity’ wasbuttressed by clan associations, self-help

Chinese schools, voluntary organisations,community healthcare services, templeassociations, investments in socialcapital and the gotong-royong(cooperation) spirit. The question iswhether Singapore’s brand of democracyand the ruling PAP political system hasthwarted Western-based democratic andliberal developments or whether socially,Singaporeans have chosen, in the last 50years, a more Confucian system of self-edition, political sacrifice of self-expression and an economic trade-off formaterialism and creature comfortsinstead of political liberalism.

The onslaught of global capitalisationhas however, widened incomedisparities and loosened the socialfabric and cultural bonds. If ThomasPicketty is right, the capitalist systemwhich the Singapore governmentsubscribes to wholeheartedly, fuels anendemic system for widening economicdisparities — the rich invariably get richerand the poor remain poor. No politics andcultural issue can change the economiclogic of capitalism in widening incomedisparities. From a global perspective,this is good news for Singapore as the GIC(Government of Singapore InvestmentCorporation) investments (property,resources, finances) around the world arelikely to keep the City-state in goodeconomic stead vis-à-vis other countries.Indeed, Picketty (2014:458?460)enquires, “Will sovereign wealth fundsown the world”? Currently SWF onlyowns 1.5 percent of all private global


Editorial


capital but the future is wide open. At thenational level however, closing the gapbetween rich and poor has no easypolitical solution. Still, over the last 50years, Singapore invested wisely inclosing income inequality througheducation and technology. Yet, risingcosts of living and major changes in wageincrements in the last 50 years has meantthat Singapore’s pioneer generationcannot live on their current meagre CPF(Central Provident Fund) savings in thetwilight years of retirement withoutsubstantial government aid, assistance orsubsidies.

One of the hallmarks of the Singaporeanpolitical system often touted by politicalleaders and administrators is meritocracy.In a multicultural and multi-religioussociety, meritocracy was aimed atneutralising cultural biases and ethnicprejudices by rewarding efforts and workbased objectively on merit and one’sabilities. However, while meritocracysolves the issue of inter-ethnic objectivity,it does not quite solve the challenges ofsocial equity and income disparities.

As American anthropologist CliffordGeertz notes in his book, Negara, theBalinese rituals, traditions and culturalcustoms made ‘inequality enchant’ in theeyes of the masses; likewise, meritocracycan be said to do the same in some waysin modern societies. As Thomas Pickettyargues the modern meritocratic systemis “harder on losers” because it justifiesdomination on grounds of “justice and

merit”, and says nothing of the “theinsufficient productivity of those at thebottom”.

What’s for Dessert?

In a globalising inter-related world,states, nation-states and City-statesare increasingly dependent on aninstitutionalised global order. Is it nowonder that two well-known publicintellectuals have recently written bookson political and global order: FrancisFukuyama’s Political Order and PoliticalDecay and Henry Kissinger’s World Order.As a small state, Singapore is becomingmore reliant on international order, globaljustice and international law. The ColdWar, a clash of two great superpowers,created ironically what Hans Morgenthaucalled a “balance of power” and in turn,a semblance of world orders. In a fluid,multipolar world with many emergingregional powers, a global institutionalisedlegal order is necessary. Without thisglobal legal order, the law of the junglewill reign — those with the biggestassertive voices will prevail. We see thisalready taking place in the South ChinaSea.

In ASEAN, transboundary disputesbetween countries (i.e., Indonesia andMalaysia; Singapore and Malaysia;Thailand and Cambodia) have beenamicably resolved through theInternational Court of Justice. Even theold school of ASEAN diplomacy, based oncomplete consensus, has given way to


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more modern systems of majority-baseddecisions amongst its leaders.

At the environmental level, the longer-term challenges in this century, areviewed by many as the turning point inhuman history. More than the currentchallenges from Ebola, terrorism,unemployment, and geopoliticalconflicts, the 21st century will be adefining century for humankind arisingironically from environmental changesthat undergird the Anthropocene. AsElizabeth Kolbert (2014) argues in herthought-provoking book, The SixthExtinction, climate change and theacidification of oceans are becomingthe trigger mechanisms of the world’ssixth major biological extinction in half abillion years. She states, “Right now weare in the midst of the Sixth Extinction,this time caused solely by humanity’stransformation of the ecologicallandscape”. More than creating a cleanand green city or a city in a garden,Singaporeans need to brace themselvesfrom extreme weather and climatechanges and find ways for environmentaladaptation to these life-threateningsituations.

As both a global city and a wealth centre,Singapore has a lot to lose if thegovernment does not navigate thechoppy waters of international politicscorrectly. Yet, while one can rely oninstitutionalised systems of justice andpeacekeeping, the political reading ofglobal events and winds of change

require leaders who are more astute,percipient and politically savvy. In a socialmedia system where ‘big data’ isbecoming the global norm, sievingthrough data and information andretrieving relevant trends while makingsense of knowledge is furtherchallenging.

Yet, Singapore’s favourable globalattraction is only as strong as the weakestdomestic political link. Domestically, theruling government needs to find ways ofbonding a social compact with its citizensto ensure continuing political stability.Singapore’s current prosperity, itsattraction to foreign investments, itseconomic growth trajectory isundergirded by how well operationalised‘governance’ is, politically and socially.

References

George, Cherian (2010) Singapore: TheAir-conditioned Nation, Singapore:Landmark Books.

Jayakumar, Shashi & Sagar, Rahul (2015)The Big Ideas of Lee Kuan Yew, Singapore:Straits Times Press.

Kolbert, Elizabeth (2014) The SixthExtinction, London: Bloomsbury.

Nisbett, Richard (2003) The Geography ofThought, New York: Free Press.

Picketty, Thomas (2014) Capital inthe Twenty-First Century, Cambridge,Massachusetts: The Belknap Press.


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Sen, Amartya K (2005) TheArgumentative Indian: Writings on IndianHistory, Culture and Identity, London:Allen Lane.

Tamney, Josephy B (1996) The Struggleover Singapore’s Soul: Westernmodernization and Asian Culture, NewYork: Walter de Gruyter.


Bruno Wildermuth, born in 1936 in Zurich Switzerland, studied CivilEngineering and holds a Masters of City and Regional Planning fromUC Berkeley. His first assignment in Singapore was to plan the initialMass Rapid Transit (MRT) System. He played a key role in the MRTDebate, and subsequently was involved in building it. He alsoestablished TransitLink, the World’s first integrated ticketing system.More recently, he formulated the distance-based through fares forpublic transport.

Infrastructure

Singapore has becomea City for Cars, not People

Bruno Wildermuth


Infrastructure

Singapore has become a City for Cars, not People

Singapore as a City-state, and citiesin general, are a collection of many

facilities to support competing activitieswhich, in total, form our daily lives. It isin the city where we work, eat, sleep,entertain, study, shop, relax, and spendtime with our families — each of theseactivities places a demand on the limitedspace available. How the variousactivities are located in relation to eachother ultimately determines the need forpeople to be mobile and hence, thegeneration of traffic.

In the early days, the Government ofSingapore, with the support ofInternational Agencies, embarked oncomprehensive land use planning effortsto determine the future of the City-state.It was recognised early, that given thelimited amount of land available fordevelopment, Singapore could not allowurban transport to become dependentmainly on cars. Instead, the crucialdecision was made to build a Mass RapidTransit (MRT) system.

Following an extensive debate, theconstruction of the initial 48-station MRTsystem (which forms the North-Southand East-West Lines) started in 1983 andwas completed in 1990. The systemscored a number of firsts in varioustechnical areas and was readily acceptedby Singapore’s population as a convenientway to travel.

With the MRT in place, the bus networkwas rationalised and the world’s first

integrated ticketing system, TransitLink,was introduced to enhance the overallpublic transport system. Since then,Singapore’s population has increasedsubstantially above the earlier planningtarget of 4 million, many additional raillines have been added to expand theurban rail system way beyond its originaldesign.

Even before the initial MRT wascompleted, the Central Business District(CBD)’s Area Licensing Scheme (ALS) wasintroduced to charge cars for entering theCBD, essentially establishing the first roadpricing scheme globally, with theobjective to discourage travelling byprivate cars or at least, increase theaverage occupancy of cars. With thecompletion of the initial MRT system, theCertificate of Entitlement (COE) schemewas introduced. The scheme limits thenumber of motor vehicles allowed inSingapore at any given time, with eachvehicle to be used for a maximum of 10years only.

With land use, substantial changes weremade to bring employment closerto more homes through thedecentralisation of many activities to newtowns. However, despite these efforts,Singaporeans, like most people indeveloping countries, fell in love withcars, and the Government found itselfincreasingly pressured to yield to theresulting demands for more road space.With the prices of cars in Singapore beingone of the highest in the world, the road


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pricing scheme largely lost itseffectiveness as Electronic Road Pricing(ERP) charges have become aninsignificant part of the total cost ofoperating a car. While the introduction ofthe COE scheme has resulted in the tightcontrol of the number of cars on theroads, one of its side effects, perhapsoriginally unintended, has been theexcessively high usage of most cars. To alarge degree, this is understandable as carowners, having paid a fortune for theircar, will maximise the use to the point ofmaking every possible trip by car torecover some of the high initialinvestment. Here, a more prudent policyis badly needed, where the price of theCOE is also linked to the average yearlymileage travelled.

Unfortunately until recently, (in line witha commonly observed Singaporeanphenomenon where scant attention ispaid to improve current infrastructures),very little effort has been made tomaintain and enhance the initial MRTsystem by increasing its capacity, or toprovide reliable bus services despite asubstantial growth in the population fargreater than originally planned for. Thus,what was once arguably the world’s besturban rail system became overcrowdedand less comfortable. At the same time,various government agencies, notablythe Land Transport Authority (LTA),expanded the road network and gave toppriority for road usage strictly to cars,with the effect that pedestrians, includingthose walking to, from or between public

transport services have become second-class citizens and are often forced to useinconvenient overhead bridges,underpasses or being forced to cross theroad via three ‘legs’ rather than simplystraight across.

For a small island nation where immenseefforts have gone into ensuring long termsustainability, Singapore may havesurprised many with its predict-and-provide approach which invariably led tomajor road widening works to deal withexisting and anticipated vehicularcongestion on roads. Such an approachis clearly not sustainable, especially forSingapore where additional space has tobe created at great costs. Already, 12percent of the city’s valuable land is setaside for transport-related use, most ofwhich is for roads. Furthermore, it is wellproven that the building of more roadsdoes not work. Major road projects arejustified based on the expected numberof cars, but more cars come up becausemore roads are built. Over and over again,this simply creates a vicious cycle ofnever-ending demand and supply of roadspace. Unfortunately, even till today, theneed to solve pressing congestionproblems still prevails.

While transport strategies with a focus onthe movement of vehicles may haveserved Singapore well in the past, whenapplied across all road hierarchieswithout exception, they have becomemajor hindrances to creating anenvironment that is friendly to



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pedestrians, cyclists and public transportusers. Many of such facilities have beenbuilt at substantial costs with little or zeromeasurable benefits for motorists.

One such example is the removal of theat-grade pedestrian crossing of PatersonRoad at the intersection with OrchardRoad. There, cars turning from OrchardRoad into Paterson Road that previouslywaited for the pedestrians to first cross,can now zoom around the corner only towait the same amount of time at OrchardBoulevard where the traffic light is fullycoordinated with that of Orchard Road.Thus, while pedestrians are forced to takea detour underground or cross at OrchardBoulevard, if they are in a wheelchair orpushing a baby stroller, cars have zeromeasurable benefits. Unlike mostEuropean cities which have adopted apolicy that road space in central areas isto be shared equally between motorvehicles and pedestrians, Singapore hasnot yet seen fit to adopt such a policy.Quite the contrary, pedestrians are oftentreated as a nuisance. In short, Singaporehas become a city for cars, rather than acity for people!

A good example that says it all is OrchardRoad, Singapore’s major shopping street.Rather than converting it to a pedestrianstreet similar to parts of Broadway inMidtown New York or the BahnhofStrasse in Zurich, pedestrians have beenallowed to take over Orchard Road oneSaturday every month, from 6pm to11pm. For the rest of the time,pedestrians are forced underground tomake more room for cars.

Given the fast-growing ageing populationof Singapore, the elderly and physically-challenged people find it increasinglydifficult to move around in a comfortableway, while those eager to walk or use abicycle can only hope for a change beforetoo long. At this point in time, 50 yearsafter its promising beginning, Singaporestill lacks a true champion for pedestriansand cyclists.

Today, in many parts of Singapore,pedestrian-unfriendly overhead bridges,narrow sidewalks and wide slip roads atarterial junctions dominate the urbanlandscape. Even major access andtransfer paths to MRT Stations lack



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priority when it comes to road spaceusage. With the population graying,such facilities become a real hindranceto many citizens, especially at widely-used locations and along access pathsto hospitals and similar facilities.

Excessively long ramps make thisPedestrian Overhead Bridge extremelyinconvenient. As shown on the right,long and regular gaps in traffic wouldhave readi ly allowed an at-gradesignalised pedestrian crossing toprovide a more convenient and muchlower cost solution without any impacton motorised traffic. Many more suchfacilities can be readily identified. Thisexample clearly demonstrates the needfor an independent review of suchprojects to avoid the waste of publicfunds for unnecessary and counter-productive projects.

Promoting high-tech solutions: Thegood and not so practical

Recently, the Government hasannounced an effort to make Singaporea smart, high-tech city. While this iscertainly a desirable objective and can bebeneficial for transport users, we can seetwo rather different outcomes: The firstis a rather positive one with theintroduction of taxi apps that are properlyregulated to ensure that only legitimatetaxi services are being offered. Theseapps have already shown a markedimprovement in the availability andhopefully better utilisation of taxis.

However, we must be critical of suchhigh-tech approaches when introducedwithout regard for the practicality of theproposed solutions. One glaring exampleis the lack of published timetables for bus



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services, as is common in the rest of thedeveloped world. Instead, thetechnology-loving administrators at LTAprefer to offer mobile phone apps thattell passengers the expected arrival timesof their buses. This, they say, is necessaryto allow the change of bus frequencybased on the number of drivers reportingfor work daily. Thus, a bus servicescheduled for six buses per hour could bechanged to five buses per hour if any ofthe drivers fail to report for work. Hence,any published timetable would beincorrect. The resulting situation simplymeans that passengers cannot plan theirjourneys in advance and instead, mustcheck the bus timing at the last minuteto avoid long, unproductive waitingtimes at the bus stop. The respectivegovernment agencies are also notprepared to check schedule adherencealong the route for buses operating inSingapore. Despite the new andsupposed tighter service standardregulations, operators and drivers aregetting away with bus bunching andleaving huge service gaps behind.

It should be noted that all major cities inthe developed world publish bustimetables for bus services and enforcetheir adherence. In the transportindustry, timetables are consideredessential for all services operating atheadways of six minutes or greater — thisapplies to almost all bus services inSingapore. Many major cities, includingTokyo, even provide and enforcetimetables for services with a five-minute

headway. Singapore, on the other hand,operates its bus services as if it were athird world country with little or nopredictability.

Given this situation, many Europeansworking in Singapore have commentedon this fact and see it as a majorhindrance to Singapore’s efforts toachieve higher productivity — clearly,time wasted at bus stops is notproductive. With millions of daily bustrips taken, the value of such timewastage is indeed very substantial.

In summary

After 50 years of rapid growth, Singaporeneeds to review and assess its objectivesfor urban development, especially withthe priority given to cars versus people.It needs to decide how much further itwants to go in allocating priority to carsover people. Hopefully, the Centre forLiveable Cities, set up in 2008 by theMinistry of National Development andthe Ministry of the Environment, cansucceed in its efforts to promote a morepeople-oriented approach for Singapore’sfuture. However, to achieve this change,the Government must be willing to adopta more balanced approach to integratedland use and transport planning and mustbe willing to revise its policies despite thedifficulties and potential backlash in theshort term.

In addition, the Government should setup an independent committee to review



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all transport-related public projects fortheir impact on pedestrians and bicyclists.Such a committee should be given thetask to perform the appropriate analysesand present a final recommendation tothe Government.

The Government may also wish toconsider revising the COE scheme toincentivise lower car usage. Forexample, the COE price might be set inthree sub-categories according to theannual mileage travelled withinSingapore; for example, at 67 percentof the full price for not exceeding12,000 kilometres, at 100 percent fornot exceeding 20,000 kilometres and133 percent for cars travelling in excessof 20,000 kilometres per year. Whilesuch a scheme might not be popularinitially, it could go a long way to makepeople consider alternative modes oftransport for many of their trips.


Mieko Otsuki has been an urban planner with the UrbanRedevelopment Authority (URA) since 2001. She studied at the NUSFaculty of Arts Geography Department for her undergraduatestudies and has a Masters Degree in Town Planning from UniversityCollege London. She has just completed a 2-year secondment withthe Ministry of National Development and is now Director(Development Control, City) at the URA.

Infrastructure

An Extraordinary Journey: 50 Yearsof Urban Planning in Singapore

Mieko Otsuki


An Extraordinary Journey: 50 Years of Urban Planning in Singapore

Infrastructure

In the short span of 50 years sinceindependence, Singapore has seen

tremendous physical transformation.Once a troubled city with majority ofresidents living in overcrowdedaccommodations and a third of thepopulation living in slums, highunemployment and lack of sanitation,Singapore has since emerged as one ofthe most liveable cities in Asia and theworld.

However, with only 718 squarekilometres of land, Singapore is one of thesmallest city-states in the world alongsideMonaco and Vatican City. As a city-state,Singapore not only has housing,community and recreation, business andtransport needs for its growing 5.5 millionpopulation, but also a nation’s needs forwater catchment, airports, defence andutilities that are typically located inhinterlands of cities. This is a luxury thatSingapore does not have. Yet, Singaporeconsistently ranks well in world rankings,such as Mercer’s Quality of Living surveyand Siemens’ Asian Green City Index. Wehave the highest home ownership ratesin the world, at 90 percent. More than80 percent of the population live in goodquality public housing developments. Wehave 3,500 hectares of nature reserves,protected from development, and 350parks of all sizes. These green spacesamount to almost 10 percent of the totalland area.

How did Singapore’s urban plannersachieve this? As a planner in Urban

Redevelopment Authority (URA), I wasoften asked this question while hostingvisits at the URA Gallery with overseascity planners. They were eager to learnfrom us, but more than that, theyexpressed puzzlement at how such asmall country could achieve so much injust a handful of decades. To understandSingapore’s journey, we need to look backon our pioneers’ work — to understandthe struggles and challenges that theyovercame through sheer innovation andhard work, as well as their boldness ofimagination that continues to drive ourplanning efforts today.

Past to Present

A New Plan For the Future

To provide quality housing and addresspoor living conditions, the HousingDevelopment Board (HDB) was set up in1960. By 1965, HDB had built more than54,000 housing units, mainly to cater tothe lower-income groups and relocationof squatters from the city. However, therewas still no overall plan to guideSingapore’s development in its rapidlychanging social and economiccircumstances. The only land use plan,the Master Plan 1958, was unfortunatelyoutdated by then. In 1967, with the helpof the United Nations (UN), plannersembarked on creating a new concept planthat would have far-reaching impact onSingapore. The Straits Times on 23 March1970 reported:“Underway now is the preparation of



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alternative strategies of developmentwithin the ring concept plan for the next20 years or more…There is greater senseof urgency today about the plan ofoperation now than when the projectwas first created in the Ministry of Lawand National Development with UNSpecial Fund assistance in 1967. Acontributory factor is the acceleratedBritish military withdrawal…Yet morepressing is the rapid pace of urbangrowth and industrial development, thetraffic and transportation problem,environmental problems and the need fordetermining priorities for development.”

A spokesperson from the Ministry added,“It is necessary to establish at least anoutline strategic plan as quickly aspossible to give rational guidance onurban development.” Clearly, plannersfaced immense pressure to rationalisegrowth and address urgent problems thatSingapore faced.

The four-year project culminated in theRing Concept Plan, which was formallypresented to the Singapore Governmentand the United Nations in 1971. This firstconcept plan formed the foundations ofSingapore’s development, including aring of residential estates skirting theCentral Catchment Area, a southerndevelopment belt from Jurong to Changi,all served by a network of expresswaysand a rapid transit system. This is theplan that also recommended Jurongarea to be developed for industry andthe airport be moved from Paya Lebar

to reclaimed land at Changi.

Beyond the physical manifestations ofthis early plan, what is notable about theprocess is that despite the heavy burdenof dealing with immediate issues, theplanners of the day decided to take thetime to put together a plan for the future— not a three or five year plan, but forthe next 20 years. This must have beenperceived as an ambitious effort at thattime. The Straits Times in March 1970noted, “…the intention is to look furtherahead…and recommend a plan-stagingprogramme to minimise the cost of shortterm development.” This principle ofplanning for sustainable growth and thedesire not to lock ourselves out of futureopportunities, continues today. However,more than this, the decision by thesepioneer planners to plan ahead and keepan eye on the long-term demonstratedstrength of spirit, a belief that with theirimagination and resolve, they can shapethe future. This is a legacy that still bearsstrong influence on how we plan for ourfuture today.

The Next Lap

The URA was set up as the nationalplanning and conservation authority in1989. It was tasked to review the earlyConcept Plan and to transform Singaporeinto a ‘tropical city of excellence’. By thistime, Singapore had grown into animportant centre for commerce andindustry in the Asia-Pacific region andpopulation was close to 2.7 million. The



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priority for planning shifted from tacklinghygiene factors to attaining quality of life.The Concept Plan 1991, termed ‘Livingthe Next Lap’, had many new innovations.It emphasised having more choices inhousing types, jobs closer to homethrough regional commercial centresclustered around Mass Rapid Transit(MRT) interchanges, recreation spacesand greenery to reinforce our sense ofislandness and cultural and creativespaces to encourage artistic expression.It created staging plans and laid outthe scenarios for Years 2000, 2010 andYear X.

While overall balanced in the coverageof issues, the Concept Plan 1991 wasnot shy to declare that Singapore’smost pressing concern then waseconomic in nature — “If we are to helplift Singapore to higher livingstandards, the muscle will be providedby our economy”. However, this did nottranslate to mere prioritisation of landfor business activities. The planners ofthe day were much more sophisticated.They noted that “Talented peopledemand an appealing, varied andstimulating environment in which tolive and work.” To preventovercrowding, to provide space forcreativity and culture around MarinaBay and to ensure sufficient breathingspace with greenery and open spaceswithin the Central Business District(CBD), the planners pushed fordecentralisation of economic activities.This gave birth to our regional centres

in Tampines, Jurong, including the sub-regional and fringe centres of BuonaVista, Paya Lebar and Novena, and theupcoming Woodlands Regional Centreas well. Beyond regional centres, weare now planning for a northerninnovation corridor that includes thePunggol Creative Cluster. The ConceptPlan 1991 also presented the Green andBlue Plan which safeguarded naturereserves, nature parks, waterbodiesand coastlines for public enjoyment.Notably, the Green and Blue Planintroduced the concept of ‘green trails’,which are now developed as our ParkConnector Network.

It was also during this period followingthe Concept Plan 1991 that the MasterPlan was reviewed comprehensively inthe form of Master Plan 1998. For thefirst time it became a forward-lookingplan, translating the long-termstrategies of the Concept Plan intoDevelopment Guide Plans for 55planning areas. This was a pain-stakingprocess to draw up detailed plans foreach of the towns, recognising theexisting features that will be retainedwhile proposing new zonings andintensities for areas that would bedeveloped. With the Master Plan 1998,home owners or buyers and businessesbenefitted from assurance of their landvalue and certainty of what would bedeveloped in their neighbourhoods.The Master Plan 1998 still forms thefoundation of our Master Plan today,most recently updated in 2014.



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Towards a World-Class City

The next revision of the Concept Plantook place a decade later between 1999to 2001. By this time, Singapore was arecognised modern city that was growingmore affluent. It had just emerged fromthe Asian financial crisis relativelyunscathed, proving its economicresilience. However, the Concept Plan2001 is not an overt response to theevents that must have shaken ourconfidence significantly. Instead, itunexpectedly shines a spotlight on softissues such as Singapore’s natural andbuilt heritage. This must have come fromthe underlying belief that authenticitywas the key to Singapore remainingattractive to Singaporeans and visitors. Itwas also to address Singaporeans’ softeraspirations that were starting to unfold.This shows again the foresight andtenacity of planners then to keep an eyeon the horizon.

Among the innovations of the ConceptPlan 2001 was the appointment of twofocus groups comprising professionals,interest groups, businessmen, academics,grassroots and students. The two groupseach tackled a land use dilemma — oneon the issue of balancing land resourcesamong competing uses, and the other onhow to retain identity even as we growand intensify land use. From the secondgroup came recommendations to domore for natural and built heritageconservation, to conserve not just singlebuildings but entire neighbourhoods and

to refine the land tender system to takeinto account design considerations,especially for landmark heritagebuildings. These recommendations led tothe development of the Parks &Waterbodies Plan and Identity Plan in2002. These plans cemented efforts tosafeguard our green spaces andbiodiversity, and led to recognition oflocal identity nodes and furtherconservation of buildings and structures,which today has exceeded 7,100islandwide.

Drive toward sustainability

Over the last decade, sustainable growthand further enhancement of quality of lifehave become major priorities forplanners. As population and livingdensities increase, planners need to worktheir imaginations even harder to ensurethat the ‘live, work and play’ environmentremains high quality and appealing evenas we strive to make even better use ofland to overcome limitations. As withmany other cities’ experience, improvingliveability also becomes more challengingwith rising aspirations. The latestrevisions to the Concept Plan in 2011 areintended to address these issues and planour future up to year 2030. The exercisewas also extended to take into accountpublic feedback gathered by the NationalPopulation Talent Division (NPTD)’sPopulation White Paper in 2013. ConceptPlan 2011 and the Land Use Plan(released as part of the White Paper)paint a picture of a sustainable city that



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accommodates a higher population whileachieving sustainable growth, integrationof greenery in the urban environment,better mobility and transportation, andways to safeguard land for future growth.

Similar to the previous Concept Plan, twofocus groups were called upon to discussissues on ‘quality of life’ and‘sustainability and identity’. These groupsrecommended that we should help todeepen the sense of community andownership of spaces and places, care fordiverse population including the elderly,strengthen our infrastructure to helppeople lead sustainable lifestyles andhave greater stakeholder involvement inshaping endearing aspects of Singapore.These suggestions further emphasisedwhat had been raised as part of ConceptPlan 2001 but highlighted the growingneed for the community andstakeholders to play a greater role inSingapore’s development.

Challenges for the Future

Even as Singapore has overcome greatobstacles in an extraordinary fashion,planners now face issues that perhapstest our strength and imagination evenfurther. Among these, I will just brieflymention three such challenges. First isthe issue of creating more space. Whilewe have plans to reclaim more land,approximately nine Ang Mo Kio towns’worth, we cannot continue to create newland through reclamation. Sea space islimited and we need to keep some areas

for anchorage and shipping. Plannersthus have to consider redevelopingexisting uses to higher intensitydevelopments. There is a need to manageleases and tenures to facilitate recyclingof land as such recycling gives flexibilityto meet rapidly changing needs as wellas address changing nature of economicand other activities. This in reality is acomplicated process. Existing uses andpeople may need to be relocated,involving lessees and homeowners. Thespaces created are also not equal — thepossible uses are determined taking intoconsideration its locational context.There is also ongoing effort to create newunderground space to free up more landaboveground for a liveable city. Relatedto these measures are the associatedcosts that must be borne by tax payers.Planners hence bear the burden ofdeciding the most effective way toexpand our usable space.

Another challenge is the issue ofdensities. One of planners and architects’holy grails is to design higher densityenvironments which are at the same timehighly liveable, and whose design iscompatible with our tropical climate andculture. This is a burgeoning area ofresearch where studies, ranging frommicroclimatic analyses and integration ofsustainability features, to impact of highdensity living on the community andsocial fabric, are explored. Upcomingestates such as Punggol Northshore,Bidadari and Kampong Bugis willincorporate many new features to



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address these issues such as sustainablehousing design that takes intoconsideration wind flow, temperatureand heat gain, infrastructure to facilitaterecycling and resource conservation,plentiful recreation spaces, highergreenery provisions and well-sited socialand community facilities. Such newgeneration housing estates can alsosupport ‘car-lite’ lifestyles, as publictransportation, walking and cycling aremade even more convenient andpleasant. There is hope that such designand planning solutions can help enhancehigh-density living and provide atemplate for future residential estates.

Lastly, as much as planners seek toenhance the physical environment, whatreally impacts quality of life is howpeople use the space, and how thesespaces knit people together for atighter social fabric. There is growinginterest in greater communityownership over neighbourhoods andpublic spaces. National Parks Board’sCommunity in Bloom is one suchprogramme that has been a success.There are non-governmentalorganisations (NGOs) such as NatureSociety, Singapore and SingaporeHeritage Society that work collaborativelywith agencies to safeguard natural andbuilt heritage while raising awarenessand making these spaces moreaccessible. Individuals, experts andstudents have come together to proposeenhancements to safeguard thecharacter of rustic Pulau Ubin. These

bright examples show that planners needto increasingly work hand in hand withthe community to envision and shape thespaces and places that would makeSingapore more vibrant and endearing.

Planners have come a long way since the1960s to transform Singapore into themodern city it is today. Even as we thinkwe have achieved much of what wasenvisioned in the early plans we laid outfor ourselves, new challenges await us.While the context may have changed,planners today will need to traverseunchartered territory just as our pioneersdid. If we can emulate their commitment,relentless drive and unstoppablecreativity, I am confident that we will beable to be proud of the next 50 years ofachievements as well.


Yang Razali Kassim is Senior Fellow with the S Rajaratnam Schoolof International Studies (RSIS), Nanyang Technological Universityin Singapore. He is also editor of two RSIS publications, RSISCommentary and Strategic Currents. In addition, he is a memberof the selection committee of the Temasek Foundation-NTU AsiaJournalism Fellowship Programme of the Wee Kim Wee School ofCommunication and Information (WKWSCI). He is a past Chairmanof the Association of Muslim Professionals (AMP).

Social Issues

Singapore In Transition:Staying Together For The Next 50- Reviving the National Language

Yang Razali Kassim


Singapore In Transition: Staying Together For The Next 50 - Reviving the National Language

Social Issues

Pondering the Way Forward

On the 60th anniversary of theNational University of Singapore

Society (NUSS) on 3 October 2014, PrimeMinister (PM) Lee Hsien Loong spoke ofSingapore in transition. For the nextphase in its evolution as a nation-state,he said that three basic principles wouldbe needed: first, looking out to stayplugged in to the world while looking inon domestic challenges; second, beinggood hearted while remaining hardheaded; and third, understanding ourpast as we embrace the future.

“We are now at an inflexion point,changing gears, changing pace. We neednot only to navigate the eddies andcurrents from moment to moment, butto keep in mind basic principles which willhelp us maintain our momentum, ourdirection, our purpose,” said PM Lee ashe sketched broad strokes of what wouldbe needed for the next journey.Essentially, these would be the guidingfundamentals, the details of whichpresumably would be for Singaporeans toidentify, debate and forge a newconsensus on, in this auspicious yearmarking the 50th anniversary ofSingapore’s independence. In otherwords, for the next phase of Singapore’smaturing as a nation-state, we must bearin mind certain basic fundamentals, oneof which, significantly, is the twoinseparable dimensions of our past andour future. This, to me, is a key to our wayforward.

However, what should the basicprinciples be? And what of the past mustwe not discard as we march into thefuture? Now that we are at these criticalcrossroads, what PM Lee called “aninflexion point”, we have to decide thekind of Singapore we want over the next50 years. How different, or similar, will thenew Singapore be from the Singaporethat we have known for the past fivedecades? How much familiarity from thepast do we want to retain to avoid a senseof rupture with our own history? In myview, for the next 50 years, this sense ofcontinuity amid change is the anchor thatSingapore needs to stabilise its journeyforward. Indeed, as I see it, this anchorrests on three legs, all intertwined andmutually reinforcing. All three playedtheir respective roles in the last 50 yearsto forge a common consciousness out ofthe disparate ethnic communities. Willthe three legs - national identity,multiracialism and the national language- remain central to the future nation-state? Will they remain pillars of thefuture, and if not, why not?

National identity in transition?

It is significant that, at this inflexion point,PM Lee sees Singapore as a nation intransition. However, what does thismean? Does it suggest that everythingabout Singapore is in transition? Does italso mean that Singapore’s nationalidentity – of being Singaporean - is in astage of transition? If so, what would theend state or future state be? At the same



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time, a state of transition implies someflux or some uncertainty. If so, perhapsthe time has come for Singaporeans todiscuss and renew the nationalconsensus on our national identity. It isin this regard that PM Lee’s notion of thebasic principles and the intertwining ofthe past and the future become crucialas we ponder our way forward.

Since independence, our national identityhas revolved around the interaction ofthe main ethnic communities of theChinese, Malays, Indians and Eurasians,as well as others. Singapore’s first primeminister, Lee Kuan Yew, understoodinstantly the crucial need to forge acommon identity out of the disparatecommunities. Although Singapore waspredominantly Chinese, its Malay originis a historical and geopolitical fact thatcould not be ignored. Lee was acutelyaware of the history and geopolitics ofthe emerging nation-state. Hence, itsroad to national identity which inevitablytook into account the forging of a finebalance among the major races, took twodistinct phases.

The first phase was defined by the driveto merge with Malaya to form Malaysiain 1963. Synchronising Singapore’sidentity politics with Malaysia thereforemade political sense — but the Malaysiasojourn was short-lived. With the nation’sindependence in 1965, Lee’s Singaporehad to forge a brand new national identity— a ‘Singaporean’ Singapore. In thissecond phase, the new identity adapted

to the post-independence politicalreality without completely detachingfrom the past. A core aspect of this newnational identity was multiracialismand was reflected in the parity of thefour official cultures and theirlanguages — English, Malay, Chineseand Tamil. However, with Malay as thenational language and English as theworking language, making Malay thenational language was a strategic step.More than a mother tongue ofSingapore’s largest minority group,Malay would be the unifying languageof the emergent independentSingapore — The national anthem is inMalay, commands and insignias of theuniformed services are in Malay,national awards are named in refinedMalay. These symbolisms aside, muchelse was in English, the language ofadministration.

As Lee put it to a panel of journalistson 11 August 1965, two days afterindependence, “The pledge given bythe People’s Action Party (PAP) is notfor the purposes of getting votes. Wewill earnestly carry it out. I make thispromise: this is not a Chinese country.Singapore is not a Chinese country, nora Malay country nor an Indiancountry…” On 19 December 1966,speaking at the opening of a school, Leeadded, “But to each also must begiven the maximum of commondenominators without which you and Iwill never be able to understand eachother… And so it is we have designated



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that Malay should be our nationallanguage.”

Enshrined in the Constitution, thenational language provided the potentialglue that goes to the soul of who we areas Singaporeans. We are, as Lee said, nota Chinese state despite the majoritybeing ethnic Chinese, nor a Malay statedespite Singapore’s historically Malayorigin, nor an Indian state — We are aSingaporean nation-state. Bindingus together in a fine balance gaveSingaporeans a sense of mutualaccommodation and convergence,engendering a sense of stability andcommonality as the people developedthe economy and transformed Singaporefrom Third World to First.

In the first 50 years of nationhood, thedifferent ethnic groups adjusted fairlywell to each other, although not withoutproblems. For the minorities, this was agood start. I remember my friends werefrom various races: Chinese, Malays,Indians, and Eurasians. In school, playingand studying together, we conversed inEnglish, and occasionally for some,switching to simple, conversational Malay— there was a sense of bonding. When Iwent to national service in the 1970s, wehad Singaporeans from various racestraining together and marching to Malaycommands, and had such language-defined arrangements as Hokkienplatoons, English platoons and evenMalay platoons. The cumulative impactwas to imbibe a certain sense of solidarity

among the trainees. The environmentwas the same when I went to universityand when I started work in the 1980s,although by then, English was decidedlythe common tongue. ‘Apa macam!’, thesimple colloquial Malay greeting of ‘Howare you!’ from a non-Malay colleaguecaptured the bilingual mood. The abilityof friends and colleagues to converse inEnglish and simple Malay sustained thefeeling of togetherness. At work, myChinese-educated friends spoke with mein English and we enjoyed our friendlybanterings in English.

While Malay was the national language,the wide facility in English was the mostimportant bridge across our ethnic andcultural divides. Everyone was speakingEnglish — the Chinese, Malays, andIndians. By that time, the Chinese,Malay and Tamil schools eventuallyclosed down under the weight ofmarket forces. English was also thesocial leveller as Singaporeans of everyethnic group spoke the language to getjobs and to communicate with eachother in their respective ethnic twangs.Overtime, Singlish developed andsurged to the forefront while Malay asthe national language receded furtherinto symbolism — there was a gradualbut certain shift in the sociolinguisticlandscape.

The shifting ground

Since the 1990s, I began to sense theshifting ground. Shopkeepers were either



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not able or not as easily inclined to breakinto conversational Malay. Taxi driverswere asking for my destination in Singlishor English, and not conversational Malayanymore, unlike 10 years ago. I foundmyself speaking to shopkeepers and taxidrivers less and less in Malay, unlike inthe past decade or two. YoungerSingaporeans could be heard chattingaway in Mandarin and not in English. Inpublic places, such as in mass rapid transit(MRT) trains and malls, the chatter wasas much in Mandarin as it was in Englishor Singlish.

While this was an understandableconsequence of the changededucation system, I was beginning toask mysel f whether a gul f wasemerging as a result of thegenerational shift. I was beginning toworry whether the different ethnicgroups were drifting apart. Yet, at thesame time, I noticed that the nationaluniformed services, the mi l itary,police and civil defence, were sti llusing the trappings of the nationallanguage, especially Malay for theirformation commands and drills, asvividly displayed during National Dayparades. Regimental sergeant majorswere still called respectfully as ‘Encik’(Malay for ‘Sir ’). Significantly, the PMis still observing the language policyof us ing Malay, Mandar in andEnglish, in that order, for his NationalDay Rally (NDR) speeches and the PAP’smain party conferences while PAPMembers of Parliament (MPs) also spoke

Malay in parliamentary sessions.As the NDRs are state-of-the-nationaddresses widely telecast to everySingaporean home, this was clearly adeliberate policy by the nationalleadership to underscore the continuingimportance of the three languages aswell as Malay as the national language.Strangely, however, the announcers ontelevision consistently referred to the PMdelivering his ‘speech in Malay’, not‘speech in the national language’ as itshould rightly be. I was wonderingwhether this was a manifestation ofoversight or ignorance, or more tellingly,of the widespread social amnesia of thefact that Malay is the national language.

National identity and changingdemographics

While those who were quietly concernedabout the perfunctory role of the nationallanguage were naturally Malays, I realisedover time that this feeling was neithermine nor the community’s alone. Anumber of my non-Malay Singaporeanfriends were also noticing with equalconcern, and they were not just from mygeneration but also younger ones. Forexample, I discovered that a friend froma local Chinese language newspaper wastaking up Malay classes. Ironically, wewere then travelling together on aconference trip to Beijing when she toldme this. When I asked ‘why?’, she replied‘why not?’ — after all Malay was ournational language, she said. This was ahuge revelation for me — I had assumed,



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very wrongly, that a Singaporean from aChinese-speaking environment wouldnever feel any attachment with thenational language. I wondered how manymore Singaporeans were like her. If shewas a reflection of a silent undercurrentof concern with regard to the state of thenational language, then the future ofsocial integration among Singapore’svarious communities in the next phasewould be hopeful.

In more recent years, this concernwas accentuated by the trend inimmigration. As more and moreforeigners took root in Singapore andbecame citizens as result of theGovernment ’s open-door policy, Iwondered how they would integrateand imbibe core Singaporean valuesand identity; I also wondered whetherthey would be able to understandthe genesis and evolution ofthe Singaporean ethos, includingmultiracialism, and the reason forSingapore’s founding fathers choosingMalay as the national language. It wasfor this very reason that I wrote anarticle reflecting my concerns forthe future of Singapore’s nationalintegration in this journal two years agoentitled Imagining Singapore 2030:Language, Demographics and theRegion . My related concern waswhether the changing demographics inSingapore, brought about by thegrowing immigration, would divideSingaporeans and hence, the need tobind ourselves even more cohesively,

including through the national language.I read with rapt attention when two yearslater, one of Singapore’s foremost publicintellectuals, Kishore Mahbubani, wrotea thought-provoking commentary in hisBig Ideas column in The Straits Times. On14 June 2014, his Big Idea No 5: Speakthe National Language writing called fora campaign to revive the nationallanguage by encouraging Singaporeansto speak Bahasa Melayu (the MalayLanguage). His comment wasunprecedented in its openness, franknessand clarity of message. I could not recallany public figure, both Malay and non-Malay, who so cogently and boldly madesuch an exhortation. He said, “Pleasenotice I did not say ‘study’ the nationallanguage. Nor did I say ‘read’ or ‘write’the national language. I only said ‘speak’because we should set a very low bar andget most Singaporeans connected withtheir national language.” He listed fivereasons, “ in ascending order ofimportance why Singaporeans shouldlearn to speak Bahasa Melayu”:

The first is to be a normal countrybecause Singapore was to himan “abnormal country” as mostSingaporeans do not speak their nationallanguage. Second, Singaporeans wouldbe able to sing their national anthemwith greater feeling and passion if theyknew a few words of Bahasa Melayu.Third is the pragmatic reason ofbeing surrounded by Malay-speakingneighbours such as Malaysia, Indonesiaand Brunei. The ability to speak the same



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language would open up variousopportunities, including economic ones.Besides, by 2030, according to oneprojection he cited, Indonesia maybecome the seventh-largest economy inthe world, overtaking Britain andGermany. The fourth reason is ageopolitical one — “Most small nationssurvive over the longer term bydeveloping geopolitical understanding ofthe neighbourhood.” The final reason,“and perhaps the most important reasonfor speaking Bahasa Melayu”, he said, “isthat a common understanding of ournational language will be one moreinvisible thread that will make our nationa more cohesive one”.

Public Reactions

It is instructive to note how Kishore’s callwas received by Singaporeans who haveessentially grown up not being familiarwith the national language, apart fromsinging the national anthem. At thesame time, the rise of China and theconsequent-growing importance ofMandarin has confirmed theGovernment’s policy of promoting thelearning of Mandarin among ChineseSingaporeans. Against this backdrop, it isnot surprising if sections of Singaporeansociety questioned the logic of Kishore’scall, such as ‘Cheang Peng Wah’ who, inan online response, argued instead forthe learning of Chinese as a “pragmaticstep” in view of China’s growinginfluence. Yet, it could be argued that itis for this same reason that it becomes

compelling to remind Singaporeans ofwho we are as Singaporeans first andforemost. It is also precisely due to thepotential uncertainties of the next 50years that there is a need for a centrifugalpull towards the centre, a pull which thenational language is best poised for andshould play.

Significantly, there appears also tobe resonance among non-MalaySingaporeans who supported Kishore’surging for the revival of Malay as thenational language. For instance, on 24Nov 2014, The Straits Times ran a letterby Jong Ching Yee calling onSingaporeans to pick up Malay as a thirdconversational language for socialinteraction in Singapore’s multiracialsociety and as a link with the region.Echoing Jong’s call, Paul Sim Ruiqi,writing on the same forum page, calledfor learning of the national language asa bridge to a deeper understanding oflocal history and culture. Taking this callfurther late last year, another reader,Lee Yong Se, called on the Governmentto promote the revival of the nationallanguage and to ride on the momentumof Singapore’s 50th anniversarycelebrations to do this: “As wecelebrate SG50 next year, my wish isthat more non-Malay Singaporeans,especially new citizens, would be well-versed in the national language.”

This growing realisation of the unifyingrole of the national language was notedby the Government. Speaking at the



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launch of the Malay Language Monthfor 2014, Deputy PM TharmanShanmugaratnam said, “Malay is ournational language and the Malay cultureis a part of our common heritage andidentity.” The chairman of the organisingcommittee who is also a senior ministerof state, Masagos Zulkifli, said that henoted the growing interest of late amongnon-Malay Singaporeans in learningMalay and that this was a positivedevelopment as Malay could function asa “facilitator of friendly ties” inSingapore’s multiracial society.

Role of the Government and the Malaycommunity

So what can be done? To begin with,there is a need for a study on the thinkingof Singaporeans, after 50 years ofindependence, on how the nationallanguage can be better positioned in thenext phase of Singapore’s evolution as anation-state. In this context, there arethree key determining factors: nationalsociety, the Government and the Malaycommunity.

There will come a time whenSingaporeans will feel the void, or toparaphase Kishore’s statement, the“abnormality” of Singapore where thereis a National Language but the people donot speak it. To many, this situation hasarisen due to the lack of activegovernment policy to promote theNational Language, quite apart fromretaining it in symbolic form at the parade

square, at NDRs or PAP generalassemblies. Views from the ground haveindeed emerged on the way forward. OneStraits Times reader, Roland Seow,responding to Kishore’s call, proposed to“bring back Bahasa Melayu as a subjectin school” while another Singaporean,Alan Kiong, appealed to “please makethis a national policy”. Bringing back theNational Language is clearly a majorexercise in uplifting the national spirit. AsWong Wee Nam wrote in Sgpolitics.netin 2011, “There must be a consciousattempt to promote the nationallanguage. People must be reminded thatthere is a national language.” An annualnational language month could be heldwhere free classes could be organised forthose who wish to learn the language, hesaid. Wong’s idea was echoed three yearslater by Wan Hussin Zoohri, a former PAPMP and teacher, when he proposed aMalay Language Week for non-MalaySingaporeans. During this period, he saidthe Malay Language Council of Singaporecould tap non-Malay students learningMalay as a third language to display theirproficiency to the public. “Such initiativesare not only appropriate and timely, butcould also provide the impetus forgovernment support.”

The Malay community must also play itspart. The national language must be keptalive among young Malay Singaporeansin the face of the community’s increasingadaptation and growing use of English.Going forward, the importance of thenational language must be reflected in



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the community as the original inhabitantsof Singapore — the pribumi or bumiputra(literally means ‘sons of the soil/land’).Malay Singaporeans must see the use ofthe national language as theircontribution to the growth of a multi-ethnic Singaporean Singapore. I see nocontradiction in this —the more Malay isused as the national language, the moreSingaporean we become. As the ‘sons ofthe soil’, the Malays are also the livingreminder of Singapore’s glorious pastcenturies ago as a trading post, much liketoday, when Malay was the regionallingua franca. The revival of the nationallanguage as the glue for a 21st centurySingapore provides the continuity amidchange that PM Lee so vividly talkedabout when he envisioned the futureSingaporean nation-state. Just as crucial,it is a fitting and timely tribute to thelegacy of modern Singapore’s foundingprime minister Lee Kuan Yew.


Ho Kong Chong is Associate Professor of Sociology at the Facultyof Arts and Social Sciences, National University of Singapore. Aformer member of the National Youth Council (6th, 7th, and 8th),Kong Chong was also the principal academic collaborator for theNational Youth Surveys 2002, 2005, 2010, and 2013. Hasliza Ahmad(Deputy Director), Helen Sim (Head), and Ho Zhi Wei (Manager)are officers from the Research & Planning Division at the NationalYouth Council, Singapore.

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Social Par ticipation in a New SingaporeHo Kong Chong, Hasliza Ahmad, Helen Sim, and Ho Zhi Wei


Social Participation in a New Singapore

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Introduction

Our youths are witnessingdramatic changes to Singapore’s

social landscape. For instance, whilealmost nine in 10 persons in Singaporewere citizens in the 1990s, this hasdeclined to six in 10 by 2014(Department of Statistics [DOS], 2014,page v). As Singapore’s populationcontinues to grow throughimmigration, the population in theRepublic wi ll become moreheterogeneous as new citizens andpermanent residents bring with themestablished ways of doing things, alongwith different social and cultural norms.

The resulting greater heterogeneitypresents a social integration challengefor hosts and new residents alike. Withthe small size and high density living ofSingapore, the resultant increase inpopulation density with immigrant flowbrings people of different socialbackgrounds physically closer. Thus, ineveryday life, congestion (in the use ofsocial and public services) andcompetition (in school and work) maycreate a frequent potential formisunderstanding and conflict, whenresponses to these common situationsstem from different cultural norms anddifferent habitual behaviour. Everydayexamples include queuing versusrushing, maintaining physical distancein crowded situations, tones of speechin public places, forms of courtesytowards fellow users, etc.

If we were to accept the argument thatSingapore is a global city and a small City-state and where movements of people(i.e., service professionals, industryworkers and domestic helpers, tourists,and students as well) are necessary forthe economy, then it is necessary forSingapore society to embrace temporaryvisitors, permanent residents, and newcitizens. Herein lies the importance ofcultivating a deeper appreciation andunderstanding between differing socialand ethnic groups while fostering greatersocial cohesion in Singapore.

Diversity, Friendships, and Singapore’sYouths

Singapore’s increasing diversity andheterogeneity have been most keenly feltby our youths, given that the residentyouth population has not kept pace withthe growth of the overall population.While one in three persons was a residentyouth in the 1990s, this proportion hassince declined to one in five persons by2014 (DOS, 2000 & 2014). As socialdiversity increases, there is a tendency fortrust to erode within and across ethnicgroups in the short-to-medium term(Putnam, 2007), particularly if there is alack of frequent, socially diverseinteraction (Stolle et al., 2008).Considering the multi-ethnic nature ofSingapore society, it is vital that youthsdevelop deeper and meaningfulfriendships that span multiple socialgroups and communities to maintaintrust and social cohesion.



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Drawing from the National Youth Survey(NYS) 2013, a number of patterns may beobserved attesting to the value offriendship diversity in maintaining trustand social cohesion within and acrossethnic groups. When asked whether theywere comfortable with someone of adifferent race as a neighbour, we foundthat youths with close friends of adifferent race reported greater levels ofcomfort, a mean of 4.53 on a 5-point scalewith five being ‘strongly agree’. Bycontrast, youths without close friends ofa different race reported a lower meanof 4.24. The differences are even greaterwhen it comes to neighbourly relations.Youths with close friends of a differentnationality reported greater comfort withsomeone of a different nationality as aneighbour with a mean of 4.29; whileyouths without close friends of a differentnationality reported a mean of 3.91.

From a policy perspective, we think thatsocial participation among youths canshape their friendship patterns and

through these networks, create anacceptance of diverse ethnicities andnationalities. Indeed, based on theavailable data from NYS 2013, we foundsuch a positive correlation betweenfriendship diversity and socialparticipation. Chart 1 illustrates thecorrelation between friendship diversityand frequency of youths’ socialparticipation. Our measure of socialparticipation includes participation ingroups covering a variety of domains suchas arts & culture, sports, uniformed,community, welfare, religion, andworkplace.

For inter-ethnic relationships, there is abig jump of 7 percent between non-participants and occasional participants,and another 9 percent jump fromoccasional to regular participation. Inter-nationality relations show a 7 percentincrease between non-participants andthose with occasional participation,moderating at 46 percent for regularparticipation — there was no difference

PARTICIPATION FREQUENCY

Chart 1: Friendship Diversity and Participation Frequency

Source: National Youth Survey (NYS), 2013



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between monthly and weeklyparticipation in friendship diversity forrace and nationality.

Taken together, the survey data suggeststhat enhancing social participation ofyouths may be a way forward to buildinga more cohesive society throughthe establishment of more diversefriendships and connecting youths withdifferent population segments.

Benefiting from Social Participation

Beyond friendship diversity, there areother benefits that youths are able toderive from social participation that willbe valuable to thriving and maintainingsocial cohesion in a rapidly changing anddiversifying society. Table 1 provides asummary of these benefits in terms ofmulticultural orientation, interpersonalrelationships, outward orientation, and

Not Active in Differenceinvolved in at leastany group one group

Multicultural Orientation

Respect values and beliefs of other groups 81% 86% 5%

Knowledgeable about people of other races 39% 50% 11%

Interpersonal Relationships

Caring about other people’s feelings 80% 83% 3%

Good at making friends 55% 64% 9%

Working well with others 69% 75% 6%

Leading a team of people 43% 56% 13%

Outward Orientation

Public speaking 20% 34% 14%

Adapting to change 63% 72% 9%

Civic Engagement

To be actively involved in local volunteer work 7% 15% 8%

To be actively involved in overseas 5% 11% 6%volunteer work

Worked with fellow citizens to solve a 1% 8% 7%problem in your community

Source: National Youth Survey (NYS), 2013

Table 1: Benefits of Social Participation among Youths



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civic engagement.

With the exception of the last item inTable 1, the indicators presented areattitudinal and reflect the degree towhich the survey participants agree tothese statements about themselves. Thedifferences between the involved anduninvolved for the volunteering items (8percent local volunteering, 6 percentoverseas volunteering) suggest thatinvolvement in social groups areassociated (though not necessarily causalin nature) with volunteerism. This isclearly important for society as the careof the weak and vulnerable are within thevoluntary sector. Another form of civicengagement is community participation.This item is particularly importantbecause it is a behavioural measure,indicating that respondents actuallyworked to solve a community problem.For this item, the difference betweeninvolved and non-involved youths is asignificant 7 percent.

The other socially important goal is in ourmulticultural orientation. Singapore’sgrowing social diversity makes it moreimportant that we adopt a multiculturalorientation. Table 1 indicates that thereare significantly higher percentagesposted by involved youths with regard torespect for the values and beliefs of othergroups (5 percent difference) andknowledgeable about people of otherraces (11 percent difference). Indeed,most social groups that have an openmembership criteria, and those which are

larger in size, have within these groups,social diversity in terms of religion andethnicity and to a certain extent,nationality. Membership in suchgroupings requires individuals to learnabout, accommodate, and embrace suchdifferences.

Besides the socially important goals ofvolunteering and multiculturalorientations, participation in groups isalso associated with a set of importantinterpersonal skills: public speaking (14percent difference), leadership (13percent difference), making friends (9percent difference), adapting to change(9 percent difference), working well withothers (6 percent difference), and caringabout the feelings of others (3 percentdifference). The important point to takeaway from this set of interpersonal skillsis that these cannot really be taughtwithin the classroom. Therefore, to theextent that these are learntinterpersonally and within the everydayroutines of group activities, socialparticipation then provides an essentialfunction to prepare individuals for theiradult lives.

Cultivating Social Participation

Participation in social groups bringsunintended benefits to the individual andsociety. Perhaps with the exception ofuniform groups, which specifically trainyoung people in leadership and otherinterpersonal skills and workplace-related groups which may be assigned by



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superiors, young people join social groupssuch as sports, arts and cultural, andhobby groups for the immediate benefitsof fulfilling their interests. In the courseof fulfilling these interests, youths areembedded in a social and normativeenvironment where they learn new skillsnecessary in the promotion of suchinterests, as well as values necessary forteamwork to occur.

Perhaps more importantly, such group-derived attributes benefit society, asfriendship diversity and multiculturalattitudes acquired through socialparticipation, work to foster integrationin society. It is significant to note thatthese attributes play a sustained andimportant role in everyday life.Individuals with friendship diversity andmulticultural attitudes are the brokers orbridges in different communities. Theirpresence facilitates crossings ininterpersonal relations, and throughthese relationships, fosters a betterunderstanding of social differences.While organisations can only work inprescribed settings, such individuals insignificant numbers and from differentsocioeconomic backgrounds are able tosocially navigate society more easily.Within social groups, interactions areregular and sustained. The diversefriendships formed within such contextsare more intimate and multiculturalattitudes formed in such settings and ata young age are strongly held.

If such behaviour cannot be taught in the

classroom and can only be learnt withinthe context of social groups, then thereis a renewed role for an emphasis onyouths to participate in groups to createsuch orientations. The overriding focuscannot be on integration alone, becausethis naked goal can never be the bindingagent between individuals. Instead, thefocus has to be on a set of activities thatdraw youths of similar interests together,such as sports, arts and culture, hobbygroups, and so on. Common interestssustain diverse friendships —multicultural orientations can only be aby-product.

Social Participation and a New NationalYouth Council

The National Youth Council (NYC) wasformed in 1989 as the nationalcoordinating body for youth affairs tosupport youth aspirations and to enablethem to lead purposeful, robust, andbalanced lives, and contribute positivelyto the nation. Twenty-five years on, NYCremains committed to the goal ofsupporting youth aspirations and actionfor the community. Yet, our society hasundergone significant changes, and thisrequires thoughtful reflection on the roleof NYC today.

Our youth social landscape has changedwith the Republic’s ascendance as aglobal city. Singapore is global city, nation,and home. Embedded within a global city,Singapore’s youths are diverse,innovative, and expressive, possessing



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strong connectivity to non-traditionalsources of information and opinion. Ascitizens calling Singapore home, ouryouths also feel the strains of the globalcity. Growing social heterogeneity andstratification, increased competition,and living costs have compounded thechallenges youths face today. Thereexists a cogent need to ensure ouryouths possess the resilience to meetthese challenges, and in particular,develop trust across ethnic andsocioeconomic lines.

Given these emergent needs, it istimely that NYC was restructured in2015 to expand its focus on developingsocial participation among youthstoday. Already, a good proportion ofyouths desire to contribute to society1,with some setting up social enterprisesand non-profit organisations.Compared to just a handful when NYCwas founded, there are over 200 activenon-government affiliated youth sectororganisations (YSOs) today. WithOutward Bound Singapore and YouthCorps Singapore now part of the newautonomous agency under the Ministryof Culture, Community and Youth(MCCY), the new NYC is poised toprepare youths for new challenges andempower them in shaping their future.

Examples of NYC programmes that willbenefit from this transition are the

Youth Expedition Project and therecently formed Youth Corps Singapore.These programmes bring diverseindividuals together in their formativeyears regardless of cultural,socioeconomic, or academicbackgrounds to meet and solvecommunity needs. Involvement in suchprogrammes often creates thebeginnings of a new awareness inyoung people:

“Most of us tend to dismiss troubledyouths as just being rebellious.However, after interacting with thelocal beneficiaries, I learnt that thereare a lot of social factors thatcontribute to their state of affairs, suchas family background and lack ofopportunities. […] As different as weare based on race, culture, andupbringing, ultimately, we all aspiretowards the same goals andaspirations in life.”

Youth Expedition Project Participant,Project Diya V, 2014

“This journey hasn’t been easy with alot of time and effort spent, andsacrifices. However, it has revealed theresilience and determination in me. […]I made new discoveries about myselfthrough engaging the community,understanding the importance oflistening, and changing and opening up

1The National Youth Survey 2013 found a good proportion of youths regard “helping the less fortunate”(41 percent) and “contributing back to society” (39 percent) as “very important” life goals in their lives.



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new perspectives in the way I view anddefine things, such as success.”

Youth Corps Singapore Participant,Cohort 1, 2014

By expanding these initiatives, the newNYC hopes to bridge youths acrosssocial strata to foster meaningfulrelationships and mutualunderstanding necessary for socialcohesion. These national-levelinitiatives also offer opportunities forour young people to develop thenecessary tenacity and resilience tomeet challenges in life. The life skillstraining and mentoring whichparticipants receive aims to help ouryouths navigate an increasingly diverseand complex society. This is part of thenew NYC’s vision — to develop ouryouths to be discerning, resilient, andactive citizens.

As the new NYC increases its capacity,plans are in place to increase ground-upinitiatives and mentorship programmes.Through the National Youth Fund, YSOscan expect a larger pool of funds tosupport their social initiatives for youths,and youths can anticipate mentors toguide their local projects or personaldevelopment. As youths leave formaleducation, youth-led initiatives will playa particularly valuable role in providingfurther opportunities for youths tobenefit from social participation, andenable subsequent generations ofyouths to do so.

Conclusion

More than a decade ago, then-PrimeMinister Goh Chok Tong articulated hisvision of a global city and anticipated theneed and challenges of building a strongsocial compact as he rounded off his2001 National Day Rally, “RemakingSingapore”:

“For our growth strategy and socialcompact to be effective, Singapore mustbe cohesive as a nation. […] If we havethe courage to confront problems insteadof skirting them, if we are prepared toendure temporary hardships, and if wecan adapt to change, we can continue todo better. This New Singapore - a globalcity with a strong social compact - is theMount Everest we must achieve. We mustsucceed, so that our children can facetomorrow with optimism andconfidence.”

Goh Chok Tong, National Day Rally 2001(National Archives of Singapore, 2001)

Today, the need for a strong socialcompact in a highly globalised Singaporeremains ever more relevant. It is anEverest for us to climb precisely becauseSingapore is both an emergent global cityand a young nation. Data from the NYSsuggests that enhancing the socialparticipation of youths may be the wayforward. Having more youths withdiverse friendships and strongermulticultural orientations could helpfoster a better understanding of social



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differences in society and broker orbridge differences across communities.To do this, the new NYC will need toleverage on collaborations with publicand private sector organisations tosupport greater youth participation in thesociety. Through these efforts, we lookforward to support and equip our youthsto surmount the challenges of a globalcity; seize opportunities to fulfil theirdreams and aspirations; and contributeto building and shaping the future ofSingapore.

References

Department of Statistics (2000). Censusof Population 2000. Retrieved from http://www.singstat.gov.sg/Publications/publications_and_papers/cop2000/census_2000_release1/excel/t1-7.xls

Department of Statistics (2014).Population Trends 2014. Retrieved fromh t t p : / / w w w . s i n g s t a t . g o v. s g /publications/publications_and_papers/population_and_population_structure/population2014.pdf

National Archives of Singapore (2001, 19August). National Day Rally Addressby Prime Minister Goh Chok Tong,Speech in English on 19 August 2001.Retrieved from http://www.nas.gov.sg/a rc h i v e s o n l i n e / s p e e c h e s / v i e w -html?filename=2001081903.htm

Putnam, R D (2007). E pluribus unum:Diversity and community in the twenty-first century. Scandinavian PoliticalStudies, 30(2), 137-174.

Stolle, D., Soroka, S., & Johnston, R.(2008). When does diversity erodetrust? Neighborhood diversity,interpersonal trust and the mediatingeffect of social interactions. PoliticalStudies, 56(1), 57-75.


Rodolphe De Koninck is a Professor in the Geography Departmentat the University of Montreal, where he also holds the CanadaResearch Chair in Asian Studies. Ever since completing his PhD thesisin 1970 at the then University of Singapore, he has remained a closeand committed observer of change in the City-state.

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Singapore: Condemned to Change?Rodolphe De Koninck


Singapore: Condemned to Change?

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“Territorial land is the essence andfoundation of a nation”~ Linda Lim (2014) p. 381

A Culture of Change?

Ever since its modern foundationin 1819 and particularly over the

last half-century, the geography of theRepublic of Singapore has beenconstantly remodelled. The Singaporeanterritory has been extended andredesigned, with its overall as well asdetailed configuration and morphology,along with its contents and attributesbeing the object of everlastingtransformation. This physical remodelinghas been accompanied by profoundcultural, social and economictransformations, when not causallycorrelated to them. To a point where onecould ask: has change been ingrained intothe Singaporean culture? And if so, whatdoes it really entail?

In the context of the increasingly criticalvocal citizen discourse that hasfollowed the 2011 elections, thequestion appears relevant, particularlyif one considers that change and thecapacity to adapt to it seem to remain adominant preoccupation, one that isreiterated from all sides, whether fromthe state or civil society.

Firstly, what change are we talking about?

1 “How Land and People fit Together in Singapore’s Economy”, in Donald Low and Sudhir ThomasVadaketh (ed.), Hard Choices. Challenging the Singapore Consensus, NUS Press, 2014, pp. 30-39.

When Singaporeans from all walks of liferefer to the need for Singapore or forthemselves to ‘change and adapt’, theymay refer to living habits and consumerpractices. However, more fundamentally,they have in mind government policies,including those that bring aboutenvironmental and landscape changes,generally of a profound nature. Moreoften than not, whoever advocatesthese changes justifies them byemphasising the City-state’s smallness.The discourse goes somewhat asfollows: Singapore having limitedterritory at its disposal, it must manageit carefully, if need be by expanding itand fine-tuning all of its uses when notoverhauling them, thus, constantlytransforming the living environment.Consequently, Singaporeans have to beready to change and to adapt.

The PAP state and the request to changeaddressed to Singaporeans

Secondly, who is really advocatingchange, or rather, who is most vocalabout the need to change? The answeris, by all accounts, the PAP state — at leastuntil very recently. This can easily beverified through an analysis of thenumerous publications that, over theyears, have been made available bynearly all Singapore ministries andstatutory boards. These include theSingapore Year Books, starting with the



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1966 edition all the way to the 1989 one;The Singapore Economy: New directions(1986); Singapore: The Next Lap (1993);New Challenges: Fresh Goals (2003); allof the Master Plans, including the morerecent ones [dated 2003, 2008, 2014 and2030] and, of course, numerous speechesby Prime Minister Lee Kuan Yew and histwo successors.

I will never forget a LKY speech, deliveredin October 1967, on the then Universityof Singapore Bukit Timah Campus to alarge crowd of students and members ofthe teaching staff. The harangue was veryblunt and definitely clear — allintellectuals, confirmed as well as aspiringones, had, unless requested otherwise,to confine themselves to study and stayaway from public debate. All members ofthe university community had to stay inline and students, accused of beingspoiled brats, were strongly advised toconcentrate exclusively on their training.All present, whether Singaporeancitizens, Malaysian ones or otherforeigners, had to firstly accept that waysof the past would be nearly all sweptaway and, secondly, step in line — “If youdon’t like it, just get out of Singapore!”— and be ready to adapt to the neededtransformations, including new ruleswhich the government would make it itsduty to define and implement.

Since then, over the years, the tone hasof course mellowed, but the attitude hasbasically remained the same, a point —i.e. the state knows best — that does not

need to be documented here. In fact, stillacknowledged by many observers, theargument still prevails. Singapore, beingvulnerable largely because of itssmallness, both territorial anddemographic, has to be ready to adaptand change, the magic word being usedto refer to just about any type oftransformation!

While equivalent statements for the needfor change, a typical political slogan, areheard throughout the world, they have aspecific connotation in Singapore. The so-called nanny state has used themextensively and continues to do so, whilemore fundamentally, deeds havefollowed the words as transformationsare continuously been implemented bythe state, with the vast majority ofSingaporeans still having little say but theobligation to adapt. This being said, callsfor change increasingly emanate fromcritics of the said state.

Nearly all post-2011 discourses still callfor change

Post-2011 discourses remain, firstly,those of the representatives of thegovernment. That is after all notsurprising, considering the extent ofSingaporean successes over the last50 years. By being able to constantlyadapt itself to the demands of aglobalising world, Singapore hassplendidly prospered in economic andmaterial terms. That at least is clear. And,according to the dominant narrative, it



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must continue to adapt its territorialconfiguration and the very distribution ofits contents. Among the multipleexamples that come to mind, I can referto a speech delivered, in late October2014, by Prime Minister Lee Hsien Loongat a Tourism50 gala dinner held atGardens by the Bay. According to thePrime Minister, to rise to the challengesthat the local tourism industry will needto face in the future, Singapore has toadapt and implement substantiveterritorial changes. These will includefurther expansion of the Gardens by theBay and “bold plans to develop theMandai area”, notably by the transfer ofthe ageing Jurong Bird Park!

However, such constant exhortations, tobe ready for change, or at leastcomparable exhortations, particularly ofthe attitudinal kind, emanate also fromcivil society including from some of itsmost thoughtful members. This includesthose who contributed to the stimulatingpages of the 2014 issue of CommentaryVolume 23 and of the edited volume HardChoices2. In most of the papersassembled in these two publications, notonly does the word ‘change’ appear veryfrequently, but so does the clearadvocating style: that Singapore andSingaporeans must change.

Thus, in his introductory article toCommentary Volume 23, Victor Savagestates, “If the City-state is to sustain itself

it needs to continually reinvent itself…”(p. 5), adding “In Singapore, one wonderswhether Singaporeans will adjust easilyto adverse changes or has society’sresilience been eroded with prosperityand politically-stable quality living” (p. 7).In the same issue of Commentary, EustonQuah and Christabelle Soh add, “It mightbe preferable to redefine the objective ofpolicies to one that pursues higher qualityof life. Here, growth is but a means to anend. Such thinking will need a newmindset…” (p. 50). While quiteconvincingly arguing against the growingownership of private cars in Singaporeand for the need to deploy a better publictransport network, Kishore Mahbubani isequally affirmative when he states, “Thesimple answer is that the world haschanged. Singapore too must change” (p.66).

Yet, is it really change - daring change -that is being advocated or just simplyadaptation to the constantly increasingpressures of globalisation and theapparent inevitable economic growththat such adaptation requires? Of course,these authors do imply that changesmust be daring, but in this, they do notdistinguish themselves from what has sofar been the dominant discourse, namelythat of the PAP state. Yet, in writing, “Weare not a nation of risk takers and that isobvious” (p. 82), one of them, BernardHarrison, does question the ability ofSingaporeans to opt for daring change.

2 Donald Low and Sudhir Thomas Vadaketh (ed.), Hard Choices, 2014, op. cit.



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Harrison has a point, in that, like allcontributors, he implies that change hasso far been imposed from above and notreally chosen by those among whom ithas been implemented. The idea that themembers of civil society have toaccelerate their weaning process awayfrom the nanny PAP state, is madeparticularly clear by Wiswa Sadasivan. Inhis insightful analysis of the Singaporeannational narrative, he points out “Withaffluence, better education and greaterexposure, Singaporeans became lesswilling to accept everything that thegovernment did or said” (p. 17). Henervertheless recognises that nowadays,“it is far more difficult to pitch a narrativethat will be received without somemeasure of ambivalence” (ibid.) — yet heconsiders it not impossible. To achievesuch a counter narrative, “There are threeprerequisites: acknowledging thatground sensibilities have shifted;discerning the deeper concerns from thesymptoms; and having the interest andwill to change the governing approach”(ibid.).

Are all transformations stillpredominantly induced by the state?

In fact, the will to change the governingapproach appears to be shared by anincreasing number of Singaporeans, asthe results of the 2011 elections havedemonstrated. However, the well-

3 Rodolphe De Koninck, Julie Drolet and Marc Girard, Singapore, An Atlas of Perpetual TerritorialTransformation, NUS Press, 2008. An updated and enlarged edition of this atlas is currently under production.

ingrained ability of the Singaporegovernment to keep the upper hand, byconstantly redefining territorialattributions, firstly through a strict andclosely monitored allocation of residentialspace, renders citizen initiativeparticularly difficult. The latter is madeeven more challenging by the admittedlycontested but equally well-establishedpolicy of allowing (into Singapore) largecontingents of foreign labourers, whichgenerates contests for space and jobs.

A careful examination of what hashappened over the last half century interms of territorial reallocations andtransformations in Singapore hasshown the overwhelming power of thestate in defining and modifying, at will,most forms of spatial bearings3. As aresult, there are very few, if any, placesin the world where citizen topophiliahas been equally contained andcurtailed over such a long period oftime. All landmarks, including culturalones, such as cemeteries and schools,have had little permanence. Theimperatives of the everlasting searchfor the ideal spatial allocation appearsupreme. Nevertheless, somewhatsurprisingly, there is one form ofcultural landmark whose redistributionseems to have gained some form ofautonomy, both cultural and spatial:places of religious worship. While theremoval or relocation of mosques,



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temples and churches has often beendictated by the need for optimal spatialplanning as defined by the state, theredistribution of places of worshipover the years seems to have beenincreasingly determined by citizenchoices.Since the late 1950s, their redistribution

throughout the entire Singaporeanterritory, islands included, has beenillustrative of both the magnitude ofspatial as well as cultural transformations(Table 1 and Figure 1 ). While the actualincrease in the total number of placesof worship has been more or lessproportionate to that of Singapore’s

1958 1988 2005 2013

Taoist temples 212 120 163 138

Mosques 76 96 71 59

Churches 32 140 234 557

Hindu temples 13 38 26 26

Buddhist temples 7 73 62 95

TOTAL 340 467 556 875

Table 1. Temples, Mosques and Churches in Singapore: 1958-2013

Source : De Koninck et al. (2008), and www.google.com.sg/maps/search/churches/

Figure 1. Churches in Singapore: 1958-2013



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population of citizens and permanentresidents from 1.5 to 3.8 million between1957 and 2013, the actual redistributionamong the religious denominationsappears very striking. The mostsignificant of the changes in distributionpatterns concern the growing share ofchurches, all denominations included.While churches, whether catholic or,mostly, protestant, accounted for exactly10 percent of all places of worship in1957, in 2013, their share had increasedto nearly 64 percent, with 557 churchesout of a total of 875 places of worship(Table 1).

Conclusion

While the increase in the appeal forChristian religious practices, particularlyof the evangelical type, is by nowa widespread and well-knownphenomenon in Singapore, its politicalimplications are perhaps not fullyunderstood. The explanation, accordingto which the rise in the appeal of theChristian religion and particularly ofevangelical churches can be attributed toAmerican-influenced patterns ofglobalisation as well as to the rise ofmaterial prosperity, is attested in otherAsian countries such as South Korea.However, it is not sufficient. Consideringthe relative political autonomy of thisevolution, and the strongly materialisticand apolitical narrative whichcharacterises most Christian religiousdenominations, does it not play into thehands of the ‘father knows best’ state?

What better can such a state wish thanto see its subjects remain primarilyconcerned with religious and spiritualissues, particularly those with a verymaterialistic overtone? This kind ofprofoundly apolitical change can onlyplay in the hands of a state that insistson the predominance of materialpreoccupations and rewards. .

For the moment, the capacity toimplement meaningful political change,including the type with major territorialimplications, appears to remain solidlyin the hands of the Singaporegovernment. This confirms the need forthe culture of change to be turnedaround and used by those upon whomit has so far been largely imposed.Andthis can only be achieved through athorough and permanent debate of all“policy, institutional and politicalchoices”, which, to paraphrase DonaldLow’s concluding statement in HardChoices, are no longer simply hard but“also critical for Singapore’s continuedsuccess”(p. 224-225).

Hence, change may become more thanjust a catchword, when it is not amanipulative one, but rather one thatsignals increasing citizen responsibilityand power over the management ofterritory and livelihood.

54

HonourEdwin Thumboo

i

Grew steadily in us, for us, ever since high resolve,Great codes of bonding ways of living right began.Across millennia, he saw through challenged times,Shaped histories, advancing to unlock and solveDisputes and happenings that split neighbour, clan;Lately, he contextualised global wars and crimes.You made us steadfast, stable, dedicated, true;Walked the talk; by example tucked us unto you.

But you gradually grew sad, and silent. Kept awayAs more and more traduced your energy, trust and love.Your fairness, spirit of regard; that willingness to share,To help the weak; wait for our proper turn, or better, say“After you, please”, not jump queues, elbow and shoveIn Lanvin shirt and tie, while appearing proper, fair;Then anxiously scramble for 5 Cs, then cash and carry,Then “Ah Beng not my business; no Tom, Dick, Harry”.

COMMENTARY VOLUME 24, 2015 SINGAPORE @ 50: REFLECTIONS AND OBSERVATIONS


ii

We need you in these competitive, octane-trotting timesChasing big bucks. Ten-month bonuses can yet be best.We stride, or rot a littler red footnote; limping city-state.

Ambition, hard work for the good life, are not crimesOf conscience when they share Honour’s badge and crest,Spirit, and embrace. They bring sureties of Heavensgate.

We joined the jam-packed flow of the after-office crowdPushing past Lucky Plaza. Impatient with a traffic light,Many dodged Comfort taxis, weaving like F1s on the road.

We watched, weighed action and re-action. Looking proud,One minimised herself, giving brown neighbours rightOf way, while a NS lad helped a pregnant lady with her load….

As that serpent of a flow, now wall to wall, tight and flush,Entered Orchard Station, narrowed, tightened coil and crush,We saw challenges bobbing in the turbulence and rush.

August 2014

Edwin N. Thumboo is one of Singapore's most distinguished poets.An Emeritus Professor (1997) in NUS, Prof Thumboo was appointedProfessor of English in 1979, Head of the Department of EnglishLanguage and Literature (1977 to 1993), the first NUS Dean of theFaculty of Arts and Social Sciences (1980 to 1991) and ProfessorialFellow (1995 to 2002).


Dr Tan Khee Giap is the Chairman, Singapore National Committeefor Pacific Economic Cooperation and Co-Director at the AsiaCompetitiveness Institute, Lee Kuan Yew School of Public Policy,National University of Singapore.

Evan Tan Beng Kai is a Research Assistant at the AsiaCompetitiveness Institute, Lee Kuan Yew School of Public Policy,National University of Singapore.

Vincent Kwan Wen Seng is also a Research Assistant at the AsiaCompetitiveness Institute, Lee Kuan Yew School of Public Policy,National University of Singapore.

Singapore Economy

Singapore’s Economic Development,1965 - 2020: Review, Reflection

and PerspectiveTan Khee Giap, Evan Tan Beng Kai and Vincent Kwan Wen Seng


Singapore’s Economic Development, 1965 - 2020: Review, Reflection and Perspective

Singapore Economy

Introduction

To review the past is not just toretain our harsh memory, but

more importantly, it is to betterunderstand how far Singapore hastravelled and has been transformed in theprocess of nation-building through thelong and uncertain road of fear andanxiety into a cosmopolitan City-statetoday. Only through a better appreciationof the past efforts of Singapore’s foundingleaders and contributions by the pioneergeneration of Singaporeans, can wecontinue to move forward with resilienceand optimism.

To provide a broad background for

contrast, it is useful to compare thegrowth of the economic pie or grossdomestic product (GDP) and the level ofGDP per capita achieved over timeamongst Singapore, Hong Kong andMalaysia. It is interesting to compare theachievements of Singapore to Malaysiagiven how these two countries went theirseparate ways five decades ago, whilebenchmarking Singapore against HongKong which is always relevant as boththese City-states are approximately of thesame population size although they arevery different in terms of sociopoliticaleconomy.

As exhibited in Figure 1, GDP of HongKong began to surge ahead of Singapore

Figure 1: Nominal GDP for Singapore Malaysia and Hong Kong, 1961-2013

Data source: The World Bank, World Development Indicators, http://data.worldbank.org/country, 2015



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and Malaysia after the mid-1970s withaggressive expansion of the economic pieoccurring through the 1980s and beyond2000 — this was mainly fueled by therobust growing China economy especiallyafter her motherland’s accession to theWorld Trade Organisation in 2002. Thesize of the Hong Kong economy sloweddown in 2008 and was sharply overtakenby Singapore and Malaysia from 2009onwards, while the latter were not muchaffected by the global financial tsunamithat broke out around this time.

Notwithstanding Malaysia’s well-endowed natural resources includingplantation crops, commodities for export,natural gas, as well as a relative bigger

Figure 2: Nominal GDP Per Capita for Singapore, Malaysia and Hong Kong, 1961-2013

Data source: The World Bank, World Development Indicators, http://data.worldbank.org/country, 2015

domestic market and a much largerpopulation base, Singapore has been ableto closely track the size of the Malaysianeconomy throughout the last fivedecades of economic expansion evenwith great handicaps in terms of poornatural endowment, a smaller populationand domestic market size. However, theGDP gap between the two economiesbegan to marginally widen since 2011.Singapore’s infrastructure bottleneck,manpower capacity constraint anddomestic political pressure for a slowerpace of economic growth may furtherrestrict business and economic activities.

As summarised in Figure 2, in terms ofGDP per capita, Singapore was tracking



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closely with Hong Kong throughout the1970s and 1980s, before it dippedmarginally below Hong Kong after theAsian financial crisis which broke out in1997 but then recovered robustly toovertake Hong Kong with a wideningmargin since 2004, partly propelled bya stronger and appreciating Singaporedollar while the Hong Kong dollarremained pegged to the greenbacksince 1984.

By 2013, nominal GDP per capita forSingapore with a population of 5.6million stood at US$55,182 while HongKong registered at US$38,123 with apopulation of 7.8 million, a substantial30 percent lower. Rather worrisome forMalaysia, a nation of 28 million people,her GDP per capita dipped slightly in1997 and has remained trapped ataround the US$10,000 level since 2010that warrants a closer study.

In comparing and contrasting withthe economic performances ofMalaysia and Hong Kong, for theensuing part of the paper, we woulddwell in greater details in pinningdown the essence of S ingaporeeconomic growth st rategies , inparticular, the role of the governmentas to how it defers from others. Wewould address some of the problemsSingapore encountered, ident i fyissues pertaining to the challengingeconomic restructur ing andimplications related to the potentialGDP path ahead.

Reviewing Economic Development afterthe Exit from Malaysia

Exactly five decades ago, Singaporeabruptly became a country overnight,literally and rather unexpectedly on 9August 1965, with no outpouring oftriumph or jubilation accompanying thebirth of the new nation. It was with shockand reluctance that Singapore took onthe uphill task of nationhood building, asa resource-poor island-state with noeconomic hinterland, exacerbated byhostile relations with neighbouringeconomies, including Malaysia andIndonesia, as well as domestic politicaland social unrest.

A serious racial riot exploded in July 1964,which led to the declaration of curfewand further severe racial rioting wasrepeated in July 1965. The social fabricof this island-state characterised as beingmulti-ethnic, multi-religious and multi-language was torn apart. Confrontationbroke out with neighbouring Indonesiaand only ended after a peace agreementwas signed in August 1966, whichdisrupted economic developmentsomewhat. Street rioting by leftwingactivists throughout the 1960s causedtremendous tension amongst the multi-racial community. Singapore’s longer-term stability was seriously threatened.

To many citizens then, including thepolitical leadership from both sides of theCauseway, Singapore had neither thenecessary attributes nor sufficient



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conditions to become a viable nation. Infact, there was a time when many peopledoubted Singapore could ever make it,but we did and the rest is now history.The Republic of Singapore today is ahighly liveable and economically viablecosmopolitan City-state, enjoying thehighest degree of racial harmony, soundindustrial relations and social stability asmeasurable by any internationalyardstick, which should not therefore betaken for granted.

The cornerstone of Singapore’spioneering success lies in the facilitativerole of the government exemplified bypragmatic public policy formulationthrough a proactive and lean civil servicesystem with zero tolerance forcorruption. In a relatively short period oftime, an impressive 85 percentownership of public housing by thepopulace was achieved under theinnovative co-payment Central ProvidentFund (CPF) scheme with contributions byboth employers and employees, sparingthe government from the need for anencumbering state welfare system.

Given the lack of natural resources,Singapore has few options other than toundertake long-term investment in itspeople through education by establishinghigh quality schools, tertiary institutionsand universities. As Singaporeaggressively solicited, grew and retainedforeign direct investment frommultinational corporations (MNCs)through the work of Economic

Development Board (EDB), skills ofindigenous workers were fast becomingobsolete and could no longer match themodern skill contents required by thenew jobs created.

Over the decades, the Republic hasgradually and consistently built up acomprehensive islandwide physicalinfrastructure network with roads,expressways and the mass rapid transit(MRT) system, integrating them withsustainable and environmentallyconscious practices. In retrospect,infrastructure development andinvestment should have been ramped upby several notches to cope with greaterdemands from a rapid growth inpopulation, but prudent considerationmust be given in the light of the uncertainnature of economic performance. Thebalance needs to be struck betweenensuring sustainable and efficient use ofgovernment revenues versus increasinglyonerous government expendituresincurred. Preparation for a rapidly ageingpopulation with longer life spans, due toyears of proper healthcare services, willalso need further consideration.

Given its limited land mass, Singaporebecame one of the most densely-populated cities globally in 2013, withtotal population reaching 5.6 million. Inorder to grow and achieve the criticalmass effect, Singapore embarked uponthe external wing policy in the early 1990swith International Enterprise (IE), whichSingapore created to help promote



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Singapore companies to expand abroadso as to overcome her limited domesticmarket size. Singapore has thussuccessfully plugged herself into theglobal trading networks withinternational trade and services nowamounting to three times the size of herGDP by running highly efficient regionalhubs for financial, aviation, maritime,logistics and telecommunicationactivities.

After decades of prudent governmentbudgeting and the establishment ofprofessional investment vehicles such asthe Government Investment Corporation(GIC) and Temasek Holdings to managegovernment surpluses, Singapore hasaccumulated ample financial resourceswhich could be called upon to cope anddeal with future challenges and potentiallong-drawn-out external shocks, so longas we think rationally as a group andbehave with responsibility as one unitedpeople within a pluralistic society.

When Singapore left Malaysia in 1965,her nominal GDP was at US$0.97 billionas compared to Malaysia’s US$3.2 billion,less than a third of Malaysia’s economy.Singapore’s economy quickly expandedto half of Malaysia’s GDP size in 1977 andreached nearly 69 percent by 1987 andcontinued to expand to reach the size ofMalaysia’s GDP by 1997, as botheconomies were propelled forward ataround 9 percent per annum between1987 and 1997. Singapore being a highlyopen export-oriented economy was more

vulnerable to external shocks, and thesize of its economy has hovered around95 percent of Malaysia between 2007 and2013 as shown in Table 1.

Singapore started as a society ofimmigrants with multi-ethnicity, religionand language. Being a poor and newnation, improving standards of livingthrough job creation and public housingprovision within a harmonious socialsetting were the immediate tasks of thegovernment, which then was still goingthrough intense struggles with the left-wing political movement. Given thatethnic Chinese-Singaporeans formed thebig majority of the population, hence thecollaboration of the Chinese merchantsand their leadership role in thecommunity, working in support of thegovernment’s development strategy,underpinned the strong economicfoundation and social environment vitalfor Singapore’s subsequent economictakeoff since 1980s.

President Tony Tan Keng Yam, in hisspeech at the Singapore ChineseChamber of Commerce & Industry SG50Outstanding Chinese Business PioneerAwards on 6 February 2015 at Ritz CarltonHotel, Singapore said, “The pioneergeneration of Chinese entrepreneursdemonstrated great fortitude in the faceof many difficulties in the early years ofSingapore’s growth journey. As theSingapore economy evolved andprogressed, these business pioneersseized opportunities and adapted to the



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Fiscal year Real GDP Growth / Gini Unemployment Rate Composite CPI Growthcoefficient

Malaysia Singapore Malaysia Singapore Malaysia Singapore1998 -7.4 % -2.2 % 3.2 % 2.5 % 5.3 % -0.3 %1999 6.1% 6.1% 3.4% 2.8% 2.7% 0%

2000 8.9% 8.9% 3.0% 2.7% 1.5% 1.4%2001 0.5% (0.46) -0.9% (0.45) 3.5% 2.7% 1.4% 1.0%2002 5.4% 4.2% 3.5% 3.6% 1.8% -0.4%

2003 5.8% 4.4% 3.6% 4.0% 1.0% 0.5%2004 6.8% 9.5% 3.5% 3.4% 1.5% 1.7%2005 5.3% 7.5% 3.5% 3.1% 3.0% 0.4%

2006 5.6% (0.46) 8.7% (0.47) 3.3% 2.7% 3.6% 1.0%2007 6.3% 9.1% 3.2% 2.1% 2.0% 2.1%2008 4.8% 1.8% 3.3% 2.2% 5.4% 6.5%

2009 -1.5% -0.6% 3.7% 3.0% 0.6% 0.6%2010 7.4% (0.44) 15.2% (0.47) 3.4% 2.2% 1.7% 2.8%

Table 1: Major Macroeconomic Indicators for Singapore and Malaysia, 1987-2013Singapore & Malaysia: GDP Growth*, Unemployment Rate, Inflation & Ginicoefficient

Data source: The World Bank, http://data.worldbank.org/indicator, 2015Department of Statistics Singapore, “Table 14: Gini coefficient Among Resident EmployedHouseholds, 2000 – 2013”, 2014Department of Statistics Malaysia, Household Income and Basic Amenities Survey Report2009, 2012Department of Statistics Malaysia, Household Income and Basic Amenities Survey Report2012, 2013

Note: *2000 - 2020 Potential GDP Growth Rate: Malaysia: 5.5%; Singapore: 4.5% (projected by ACI atLKYSPP, NUS); 2013 Per Capita GDP: Singapore US$55,182; Malaysia US$10,538

GDP Size 1977 / 1987 1997 2007 2013

Malaysia US$14 / 32 US$100 US$194 US$313billion billion billion billion

Singapore US$7 / 22 US$100 US$180 US$298billion billion billion billion

(SNG / MAL) 50% / 69% 100% 93% 95%

GDP 1977- 1998-Growth 1997 2008

Malaysia 8.9% 4.4%p.a. p.a.

Singapore 9.2% 5.2%p.a. p.a.



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environment. Our pioneers believed inSingapore’s future and remained rootedhere. Apart from succeeding in theirrespective fields, many of these pioneersalso made it a point to give back tosociety.”

In fact, we should also pay tribute to thebroader business communities, especiallythe small and medium enterprises (SMEs)that have provided crucial social stabilityto the society in terms of employment,exemplary work ethic andentrepreneurship. During the transitionof economic restructuring, thegovernment then tried very hard toattract MNCs to create jobs and acquiredglobal corporate management skills forSingaporeans. The Singapore businesscommunity, including big and smallcompanies, have contributed toSingapore’s national defense plan and inpromoting education which helped toensure a competitive economy, strongsecurity in defense, preserved the valueof traditional culture and harmoniousracial relations.

According to estimations by AsiaCompetitiveness Institute (ACI) at theLee Kuan Yew School of Public Policy(LKYSPP), National University ofSingapore (NUS), potential GDP growthfor Singapore and Malaysia was projectedto be at 4.5 percent and 5.5 percentrespectively for the period from 2000 to2020, and the former appears to havegrown above its potential level whereasthe latter grew considerably below its

potential output over the period of 1998to 2008. Price stability prevailed in bothcountries from 1998 to 2010, as inflationregistered at 1.3 percent for Singaporealthough this was higher at 2.4 percentfor Malaysia. Correspondingly over thesame period, Singapore managed toachieve fairly low unemployment rateaveraging at 2.9 percent as compared toa higher rate of 3.4 percent for Malaysia.As for income disparity measured by theGini coefficient, it was around 0.46 forSingapore and Malaysia from 2000onwards, and both countries could havedone better on this count.

Based on the annual economiccompetitiveness ranking conducted byACI at LKYSPP which tracked ASEAN-10economies from 2000 onwards,Singapore consistently ranked in the topposition, followed by Malaysia. Asrevealed by the standardised score, theformer at 2.0507 is at least twice ascompetitive as the latter calculated to beat 1.0601 (see TAN, et al. 2013; TAN andTAN, 2014).

We thus conjectured that such superiorrelative economic competitive advantageenjoyed by Singapore over Malaysia canbe traced to differences in policyformulation and implementation. Thereexists relative government inefficiencies,a lack of adequate governance anddiscriminatory policies in favour of “sonsof soil” or bumiputra as it is referred toin Malay language, which has beenbroadly implemented in various fields



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including businesses, education, housingand land policies. Furthermore, asMalaysia moved into a two-party systemsince more than a decade ago, preciouseffort and time have been diverted tolong-drawn public policy debates,political conflicts and socialconfrontations at the expense offormulating longer-term economicgrowth strategies and realising policyobjectives.

Singapore’s Economic Takeoff andTransformation into a Cosmopolitan city

To fully appreciate Singapore’s economicgrowth model, we have to look to thegrowth strategies at different phases oftransformation over the past fivedecades. Between 1965 and 1986,Singapore experienced an average GDPgrowth of 8.6 percent per annum underthe labour-intensive production-drivenphase where the primary objective wasemployment creation. Between 1987 and1997, the republic registered an averageGDP growth of 9.3 percent per annumunder the capital-intensive investment-driven phase where the objective was toupgrade the quality of economic growththrough labour-saving strategy.

Between 1998 and 2008, Singapore wentthrough a much lower average GDPgrowth of 5.2 percent per annum underthe innovation-base technology-drivenphase as the City-state attempted tomove up the technological ladder. By2009 and beyond, as regional

competitiveness intensified and businesscosts started to hike, Singapore enteredinto the productivity enhancement value-added-driven phase where the economyis currently facing some adjustmentdifficulties, especially in the businessservices and construction sectors, whichhave become used to an abundant supplyof relatively cheaper foreign labour.

Currently, the densely populatedcosmopolitan island-state is facing twinpolicy dilemma with some hard choicesto make. On one hand, it is about thedesirable magnitude of economicgrowth, which would have a directbearing on the level of wage growth andlabour productivity growth. On the otherhand, the public must also decide on asocially tolerable and politicallyacceptable foreign workforce pool, whichwould impact on business costs andeconomic activities. Thus, this sectionintends to sharpen the focus pertainingto the discourse on public policies relatedto Singapore’s growth strategies as allgrowth options will necessarily involvepolicy trade-offs.

Firstly, has Singapore’s economyexpanded too fast and too high with theGDP growth? Would problems such asincome disparity, rising housing prices,public transportation and trafficcongestion be avoided if growth weremoderated? Secondly, how can thegovernment significantly mitigate theseproblems through fundamental changesin public policies even as Singapore strives



Singapore Economy

to be more inclusive? Thirdly, as publicdiscontent escalates between the havesand have-nots, can income disparity besignificantly mitigated to prevent theemergence of an economic underclasswithout resorting to a comprehensivesocial welfare system, which will not onlybe a financial burden on the state but adisincentive to taxpayers. This isespecially pertinent as Singapore’spopulation ages and lifespan increases.

As illustrated in Figure 3, Singapore wentinto an era of discontinued economicgrowth interspersed with recoveries andrecessions yet, still managed to achievean average GDP growth of 5.2 percent per

annum over for the period of 1998 to2008, notwithstanding three crises thenation encountered, all externally driven.These are the 1998 recession caused bythe 1997 Asian financial crisis, thebursting of the American ‘dotcom’bubbles in 2001 and the outbreak of theSeverely Acute Respiratory Syndrome(SARS) in 2003. Singapore’s economycontracted again in 2009 as caused by theUS subprime-led global financial tsunami.

Note that between 1987 and 1997, whenthe external environment was stillfavorable, Singapore went through robustannual GDP growth of 9.2 percent. Aswith all maturing economies, it is an

Figure 3: Singapore GDP Growth Cycles and Trends, 1965-2013

Data source: The World Bank, http://data.worldbank.org/indicator, 2015



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enviable growth rate that is unlikely tobe repeated. Interestingly, in those years,not many in Singapore complained thatthe growth was too high or too fast, asthe economic gains were more evenlydistributed and the public at large wasless outspoken.

Did the Singapore Economy Grow TooHigh and Too Fast and Can We OptimallyCharter our Growth Path as We Choose?

According to the 2013 data fromthe International Monetary Fund,Singaporeans are the third wealthiest inthe world in terms of per capita GDP,ranked after Qatar and Luxembourg.However, such rankings are notmeaningful if we also recogniseSingapore to be perhaps the world’s mostvulnerable open economy with tradebeing three times the size of her GDP.When the 2009 American sub-prime-ledcrisis kicked in, Singapore was amongstthe first to tailspin into a recession,forcing the government to dip into itscoffers significantly to help ease costs ofthe economic downturn for companiesand minimize pains of unemployment bydeploying the untargetted Jobs CreditScheme.

Given the slow recovery of the USeconomy, notwithstanding quantitativeeasing by the European Central Bankannounced to begin by March 2015, theexternal debt-driven fiscal weakness willcontinue to ferment within the EuropeanUnion (EU). The economic crisis plaguing

European economies are unlikely to bequickly resolved as they reflect deep-seated structural problems of erodingcompetitiveness and heavy burdens ofthe welfare system. The US and the EU,being two major export markets,presented unique challenges of externalshocks for Singapore’s highly openeconomy.

In our recent research on “Asia’s Driversof Growth” (See TAN, et al. 2014), weconcluded that given existing tradelinkages, the US and the EU are stillamongst the major engines of growth forall Asian economies, except Taiwan andHong Kong. As western economies getchilled, economies in Asia especiallySingapore will be the first to catch asevere cold even as we exercise regularlyand with antibiotics on standby! Wetherefore cannot be immune fromtroubles from these developed westernregions.

Singapore went through a drasticeconomic slowdown in 2012 soon afterthe US subprime-led recession in 2009.It will become more expensive to financethe European sovereign debts withdeteriorating international confidence asthe required painful austerity measurescontinue to be resisted by the Europeanpublic at large. In the face of suchheadwinds, no amount of jobs creditscheme could have averted the rapideconomic slowdown in 2012 forSingapore because as a small and highlyopen economy, we can only strive to be



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better prepared and deal effectively withexogenous shocks over which we havevery limited control.

Amongst the most misunderstoodgrievance the public often raised is thatthe Singapore economy has beengrowing too fast and were growing at allcosts! Such arguments, inappropriatelyassumed that the government couldeasily control and decide the speed andmagnitude of GDP growth, acceleratingor decelerating the economy as desired.

Even if it were to be true, it does notmake logical sense that when theexternal environment is highlyfavourable, government should curtailemployment growth by tightening thelabour market, driving up businesscosts in a bid to slow economic growth.Such a direct interventionist approachwould have serious repercussions onbusinesses and potential investors.Should multinationals conclude suchgovernment measures to be the officialmode of economic management andonce they made a decision to shift theirinvestment plans elsewhere, it wouldbe most unlikely to see them relocateback to Singapore.

Strategies and Policy Trade-Off GoingForward: Can We Have the Cake andEat It?

It is thus unwise for the government toimpede robust economic growth in goodtimes through curtailing employment

growth in response to public resistanceto the presence of a large foreignworkforce or being pressured by othersocial-political considerations. Suchpopulist approaches could spell troublefor the government du jour. It isunrealistic to expect the government todip into its funds regularly for specialtransfers or to be able to sustain balancedbudgets for the full term of the electedgovernment should the future be riddledby a higher frequency of recessions,propelled by circumstances outside ofone’s control.

During the period between 1998 and2008, economic growth averaged 5.2percent and this masked the volatilitybrought on by recessions that werefollowed by near double-digit growthrates. Over this period, Singapore actuallyachieved annual employment growth of2.9 percent and annual averageproductivity growth of 2.5 percent. Thisperformance nearly halved the annualgrowth rate of 9.3 percent for the period1987 to 1997.

The question at hand, then, is notwhether Singapore’s GDP has expandedtoo fast or if the authorities have pursuedgrowth at all costs. Regardless of growthquantum, it falls upon those in thegovernment to muster better plans andcoordinate government agencies tobetter manage anticipated infrastructuredemand; identify and understand thetypes of jobs being generated, along withthe suitability of skill sets required from



Singapore Economy

the local workforce; forecast publichousing needed, make provision foraffordable and accessible healthcareand maintain a sustainable livingenvironment in support of a biggerpopulation. In fact, we would ventureto argue that even if average GDPgrowth were to be slower by half forthe period of 1998 to 2008, many ofthese aforementioned problems mightcontinue to prevail with their severity, notnecessarily lighten, amidst growingpressure of budgetary difficulties!

It would be a misdirection of criticism toblame the government for seizing robusteconomic growth when the externalenvironment permits. It is precisely theadoption of such pro-growth strategywhich ensured prudent and enablesustainable budgets over the businesscycles. [LT1] It is now most timely forus to re-examine the fundamentalphilosophy underpinning our publicpolicies, by re-addressing the new role ofthe government in the pursuit of an evenmore inclusive society even as weattempt to capture the opportunities thatavail themselves in favourable externalenvironments.

To rephrase the issues and questions athand again, which deserves seriousconsideration and rational thinkingthrough: Should the government cave into populist political demands byartificially and abruptly choking off theessential foreign labour supply requiredfor business expansion and hence,

slowing down economic and wagegrowth, or should we rather deploygreater efforts and accumulatedgovernment surpluses to bettercoordinate public policies to help sharpenthe ability to compete throughtransformational productivity and upskillenhancement programmes for thosewho fell behind?

Rapid Globalisation: EconomicRestructuring and Issues Encountered

Singapore then had taken full advantageof the globalisation process by pluggingherself into a global trading network bypioneering free trade agreements (FTAs),facilitated by a rising stature as aninternational financial centre as well asan efficient international aviation andmaritime hub. As much as Singapore hasreaped the benefits of globalisationthrough trade and finance, with it wereunwelcomed side effects such aswidening income disparity, rising housingprices and overcrowded publictransportation.

However, as Singapore moves up thetechnological ladder with intensifiedregional competition coming fromneighbouring ASEAN countries such asChina and India, skill sets possessed bySingaporeans born in the 1950s and1960s are fast becoming irrelevant tohigher value-added jobs generated.Attempts to boost productivity have notyielded the results needed to match thedemand of a rapidly restructuring



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economy. Singaporeans from low-incomehouseholds that received only secondarylevel or lower-education, areincreasingly trapped in an economicunderclass, and further disadvantagedby factors such as larger family sizes,social capital and information networkdisadvantages.

Singapore’s income disparity asmeasured by the Gini coefficient hasrapidly worsened since the late 1990sregistering its worst reading of 0.48in 2012.

With the quickening pace ofglobalisation, heavy subsidies foreducation, healthcare, public utilitiesand Central Provident Fund (CPF) top-ups were made avai lable throughspecial transfers from the annualbudget which came to $2.6 billion peryear from 2000 to 2009. According tocomputation by Department ofStatistics in 2013, such special transferswere able to contain the Gini coefficientat around 0.44, the same level asin 2000.

Over the same period, we haveobserved a widening gap in the growthof income for the highest 20 percentilehouseholds versus the lowest 20percentile households. It behooveseconomists to examine why theincome gap is widening, the thesisthat globalisation and technologyadvances are rendering lowly trainedski lls obsolete may not offer a

comprehensive account of thewidening gap.

Benchmarking Economic Performancesof Two City-states: Hong Kong versusSingapore

Singapore is not as fortunate as HongKong, which was able to and is stillbenefitting from the Mainland and HongKong Closer Economic PartnershipArrangement (CEPA) as well as WorldTrade Organisation (WTO) Plusconcessions, with China rapidlyexpanding as an economic powerhouse.While Hong Kong’s defense is entirelytaken care of by the People’s LiberationArmy (PLA) of her motherland, Singaporereserves a substantial portion of herannual budget to maintain her defensecapabilities. More than occasionalfrictions with neighbouring countriesdistract from what would have otherwisebeen even closer economic cooperationwithin ASEAN.

In comparison, Hong Kong’s GDP grew atan annual rate of 6 percent in the 1987to 1997 period and 3.8 percent in the1998 to 2008 period, about 40 percentlower than what Singapore achieved overthe same period. Interestingly, whenwe contrasted and observed theperformance of the two City-states, thatwhenever there was a recession, HongKong would sink deeper, and wheneverthe economy recovered, Singapore wouldrebound higher. In comparison,Singapore’s GDP was only 43 percent



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Table 2: Major Macroeconomic Indicators for Singapore and Hong Kong, 1998 -2013Singapore & Hong Kong: GDP Growth*, Unemployment Rate, Inflation & Gini coeff.

Data source: The World Bank, http://data.worldbank.org/indicator, 2015Department of Statistics Singapore, “Table 14: Gini coefficient Among Resident EmployedHouseholds, 2000 – 2013”, 2014Hong Kong Census and Statistics Department, 2006 Population Census - Thematic Report:Household Income Distribution in Hong Kong, 2007Hong Kong Census and Statistics Department, 2011 Population Census - Thematic Report:Household Income Distribution in Hong Kong, 2012

Note: * 2000 -2020 Potential GDP Growth Rate: Hong Kong: 3.5%; Singapore: 4.5% (Projected by ACI atLKYSPP, NUS); 2013 Per Capita GDP: Singapore US$55,182; Hong Kong US$38,123

Fiscal year Real GDP Growth / Gini Unemployment Rate Composite CPI Growthcoefficient

Hong Kong Singapore Hong Kong Singapore Hong Kong Singapore1998 -5.9 % -2.2 % 2.2 % 2.5 % 2.9 % -0.3 %

1999 2.5% 6.1% 4.6% 2.8% -4.0% 0%2000 7.7% 8.9% 6.2% 2.7% -3.7% 1.4%2001 0.5% (0.53) -0.9% (0.45) 4.9% 2.7% -1.7% 1.0%

2002 1.7% 4.2% 5.1% 3.6% -3.1% -0.4%2003 3.1% 4.4% 7.3% 4.0% -2.5% 0.5%2004 8.7% 9.5% 7.9% 3.4% -0.4% 1.7%

2005 7.4% 7.5% 6.7% 3.1% 0.9% 0.4%2006 7.0% (0.53) 8.7% (0.47) 5.6% 2.7% 2.1% 1.0%2007 6.5% 9.1% 4.8% 2.1% 2.0% 2.1%

2008 2.1% 1.8% 4.0% 2.2% 4.3% 6.5%2009 -2.5% -0.6% 3.6% 3.0% 0.6% 0.6%2010 6.8% (0.53) 15.2% (0.47) 5.2% 2.2% 2.3% 2.8%

GDP Size 1977 / 1987 1997 2007 2013

Hong Kong US$16 / 51 US$177 US$212 US$274billion billion billion billion

Singapore US$7 / 22 US$100 US$180 US$298billion billion billion billion

(SNG / HK) 43% / 43% 56% 85% 109%

GDP 1977- 1998-Growth 1997 2008

Hong Kong 6.0% 3.8%p.a. p.a.

Singapore 9.2% 5.2%p.a. p.a.



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that of Hong Kong’s between 1977 and1987, before it quickly caught up to 56percent and 85 percent in 1997 and 2007respectively and has since surpassedHong Kong by 9 percent in 2013.

One may conclude that the positiveinterventionist approach enabled theSingapore government to squeezerelatively more growth from theeconomy than the non-interventionistHong Kong authorities. Furthermore,Hong Kong’s economy was constrainedby the rigid Hong Kong-US dollarexchange rate peg regime that preventedthe economy from making costadjustments through exchange ratemovements, which necessitates deepprice corrections in the stock market andrisks severe downturn in the real-estatesector during recession.

The Hong Kong Government’s Long TermFiscal Planning Working Group pointedout in 2014 that “ if Hong Konggovernment still insists on all kinds ofpublic service expenditures and based onthe present trend, structural governmentbudget deficit is projected to prevail inseven years’ time (2021), and allgovernment surpluses will be used up by2028, thereafter would have to resort toborrowing”. This is the fiscal predicamentof Hong Kong after having built up acomprehensive and expensive welfaresystem that Singapore must not beindulged in.

In contrast, the Singapore government

has been under pressure on how tomanage their surpluses from years ofeconomic growth, trying to cater for largedemands for special transfers or subsidiesin each annual government budget tomitigate income disparity and the effectof an ageing population. In fact, thespecial transfers from the annual budgethave doubled since 2009, and areexpected to remain at the same level ifnot rising higher in the future!

Overcoming Demanding PublicExpectations and External Challenges:Reflection and Perspective

After the robust GDP growth of 15percent for 2010 from 1 percentcontraction in 2009, Singapore hasregistered GDP growth at an average rateof 3.3 percent per annum between 2011and 2014 that is lower than the potentialrate of 4.5 percent per annum estimatedby ACI. The lower growth performancewas mainly due to labour supplyadjustments by the government toimprove productivity coupled withpressure by widespread public demandto scale down on foreign workforceengagement. Companies with orderswere therefore not able to expand theirbusiness activities, with some companiesconsidering relocation that posed abigger risk for Singapore. This is a policyarea Singapore needs to calibrate andtread very carefully on.

Singapore is being ranked by internationalagencies as among the world’s top five



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positions for 2013 in terms of being thefreest economy, least risky forinvestment, least corrupt and the mostcompetitive economy overall,notwithstanding the fact that thenation is a highly open economy thathas no natural resources, a smallpopulation base with geographicallimitation with a total trade volumethree times the size of her GDP, makingher heavily dependent on externaldemand.

Over the business cycles, successiveterms of pro-active governments wereable to achieve above potential GDPgrowth for nearly five decades and ahealthy budgetary position due topolitical stability and racial harmony,coupled with its relentless effort todiversify the economy, contain costs,cultivate harmonious industrialrelations while remaining competitiveand innovative, notwithstandingvolati le external markets.Nevertheless, such a growth strategy,for various reasons and factors, begunto be doubted by some in certainquarters and culminated in thewatershed of dissatisfaction asexpressed in popular votes at theGeneral Election (GE) of 2011.

An Inclusive Society: Public HousingPolicy and Harmonious IndustrialRelations

Improving income disparity andbui lding an inclusive society is a

national commitment, but how to goabout achieving it requires consensus.Pertinent questions include what thebasic principles for growing theinclusivity is, how costly andsustainable would it be, how is such aninclusive society funded and who willbe paying for it.

Public housing is an important socialequaliser, a unique facet of Singapore’sway of life and an integral part of theasset enhancement programme within aland-scarce rapidly growing City-state.House ownership will be meaningless ifits value does not appreciate or worse,stagnates or depreciates over time.Discounted prices and incentives aretherefore necessary for first time would-be new house buyers. Discussion as tohow the government can ensure thefruits of the land and asset property assetappreciation are to be fairly distributedto those citizens who aspired and areprepared to work for it, holds the key.

Effective tripartite relationships amongstthe workers, employers and thegovernment will remain as thecornerstone of Singapore’s harmoniousindustrial relations and productivity drivein exchange for employment stability andproduction efficiency. Such tripartitearrangements should not be taken lightlyor be taken for granted. Indeed it is abedrock of the economy without which,the erosion of competitivenesspainstakingly built over decades, wouldoccur.



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Subsidising public services andtracking of four essential affordabilityindices

Provision of public services includingeducation, healthcare, public housing andpublic transportation constituted asignificant portion of cost of living foraverage citizens. Should such essentialservices be privatised or nationalised?Post-GE 2011, the Singapore governmenthas quite rightly abandoned the break-even cost-recovery market pricing(BCMP) strategy for public services,moving away from the past ultra-prudentbudgetary principle.

Such policy about-turn surely cannotcome free-of-charge as it would meanbigger government expenditures whichhave to be funded from elsewhere,presumably from the tax payers, directlyor indirectly. Are you prepared to do soknowing that the burden will likely togrow heavier over time with our rapidlyageing population, unless this weight isshared by a younger population throughproductive new immigrants?

The transparent tracking of affordabilityindices would assure and serve to allaypublic concerns. Periodically disclosedTransparent Affordability Indices (TAIs)may be computed, by working inconjunction with the government, tocompute the affordability of essentialpublic services for average Singaporeanresidents that can stand up to publicscrutiny, further reinforcing public

confidence and trust in the government.Constructing annual internationalbenchmarking indices to compare theworld’s major cities in terms of cost ofliving, wages and purchasing power, asper the studies ACI in LKYSPP hasjust completed, would be a usefulcomplement to the TAIs (See TAN, et al.2015).

Calibrated Steady-State NationalManpower Policy: Allocating One-ThirdForeign Workforce for the Economy

For continued development and growth,relying on a considerable foreignworkforce is the reality for our City-state,but there is a trade-off involved. To whatextent are we prepared to accommodateor tolerate their existence and how readywould the government be to meet theirneeds and requirements for hosting themin Singapore?

The government is committed to aimtowards a steady-state where not morethan one-third of the total workforce willbe foreigners and ensuring that allSingaporeans who want to work will findjobs with decent pay through practicaleducation curriculums, industrialinternships, subsidised productivitytraining and workfare incomesupplement scheme. Singaporeansshould feel confident in the workplacewhile competing against a foreignworkforce.

It is therefore paramount for the public



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to understand and accept that, so longas the trend is moving towards thetargetted one-third, fluctuation in theforeign workforce hovering above orbelow this quota would be tolerable overthe business cycles. This is to say thatwhenever the external environment isfavourable, we shall need to seize uponexternal demand to add revenues to thegovernment budget that may haveincurred deficits during global economicdownturns.

Over the past decade, Singapore was ableto create more jobs than the residentworkforce can assume. It is thereforecrucial for the public to understand andaccept that, highly skilled white-collarforeign professionals can help to createmore jobs and cheaper blue-collar foreignworkers are also needed to work oninfrastructure projects.

Quality Employment Creation: EnsuringTwo-Third Indigenous PMETs by 2030

As a policy objective, the governmentprojected that indigenous professionals,managers, executives and technicians(PMETs) would increase from the currenthalf of the occupation profile to two-thirds by 2030, so that we would requireless employment pass issuance and S-pass holders.

In the event of a protracted low growtheconomy, either due to companiesrelocating and/or worsening externaldemand, would Singapore still be able to

create quality jobs for PMETs? Does itmake logical sense that when theexternal environment is highlyfavourable, the government shouldcurtail employment growth by tighteninglabour market condition so much so thatit raises business costs and removes‘unwanted’ extra business growth,forcing the economy to slow down?

The steady-state projected population of6.9 million by 2030 is critical in ensuringeconomic resilience and a consistentgrowth path for Singapore. The pertinentapproach is therefore to monitor forquality immigrants who can contribute totax income and who possess the abilityto integrate locally, which depends onwhere they are being sourced fromwithout disturbing the racial status quoor undermining social harmony.

Reflections: Stop Inward Looking, AvoidBlind Spots and Pursue Correct PublicPolicies

Given the ever-rising publicexpectations, the following are somepertinent questions that Singaporeanscan attempt to think through. Are youprepared to see employment creationand business vibrancy in Singapore slowdown as MNCs relocate? Would youaccept continuing infrastructurebottlenecks and traffic congestions ifwe do not have enough foreign workersto build them? Would you accept delaysin the timelines for building 200,000units of public housing? Would you be



Singapore Economy

prepared to pay higher taxes in theform of good and services tax,personnel income tax or corporateprofit tax so as to fund higher socialspending?

Meanwhile, the government may wantto re-think some of the public policiesthat served well in the past but have sincegone into auto-pilot which might needrecalibration, fine-tuning or even areverse of directions, although in somecases these reform efforts may havealready been taking place.

The HDB may want to considerrevamping the affordability index forpublic housing pricing and rentals in orderto appropriately reflect weights assignedaccording to room-types and incomebrackets.

The National Environmental Agency maywant to look at the cost-of-living index inrelation to the government’s definedMonthly Living Wage when setting therental and base-price bidding for hawkerstalls.

The Public Transport Council may wantto reexamine the formula for settingpublic transportation fares by indexing itto affordability according to capitahousehold income, age groups andinflation.

The Jurong Town Corporation maywant to review land costs, factoryrentals and selling prices for small and

medium enterprises based onfeasibility of business proposals to bejudged by an independent private-sector led committee.

The Ministry of Manpower may want torequire statutory declaration from humanresource directors’ that they haveactively sourced through the localworkforce before approving theapplications of foreign workforce forEmployment Passes, S passes and WorkPermits.

New inclusive approaches would not onlynecessarily lead to lower revenues orbigger subsidies for statutory boards,ministries and government-linkedcompanies, but they would also translateinto higher income and employment forSingaporeans. It is certainly superior toimplementing a more expensive, fiscallydebilitating and comprehensive socialsafety nets proposed in some quarters.

These inclusive approaches are also morecost effective than the current WorkfareIncome Supplement (WIS) Scheme,which cannot significantly mitigateincome disparity and would continue tobe a funding burden with a very remotepossibility of these individuals achievingincome independence, unless we raisethe level of income supplement and linkit to upskilling programmes with agraduation timeline imposed.

Using benchmarks gathered over the pastdecade, ACI at LKYSPP simulated three



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medium-term GDP growth scenariosachievable under various levels ofproductivity growth targets required, byassuming a certain level of employment,labour share, total factor productivity,labour and capital quality growth.

Based on the actual economicperformance of the economy over theperiod 1998 to 2008, we have simulatedthe associated GDP growth band andproductivity target for pessimistic,optimistic and the base case scenarioswhich we perceived it to be most likelyto prevail for the period 2009 to 2020 asshown in Table 3.

Basically our base case simulation resultssuggest that for a policy assumption of1.5 percent employment growth coupledwith other assumptions for capital andlabor quality, the Singapore economywould grow at an annual average rate of4.2 percent with required productivitytarget of 2.7 percent per year for theperiod 2009 to 2020. Such a GDP growthscenario would mean that Singapore’sworkforce must be prepared to deliver atthe top end of the National ProductivityTarget (NPT) band of 2 percent to 3percent as set by the 2009 EconomicStrategies Committee (ESC).

For an optimistic scenario, if theauthorities should push for an annualaverage employment growth of 2percent, the Singapore economy wouldbe able to achieve an average annual GDPgrowth of 5.6 percent with required

productivity target growth of 3.6 percent.Such a situation would mean achievingthe productivity level well above the NPT— a tall order! Such an optimistic scenarioimplies continued public discontentagainst the government as it requires alarge foreign workforce, especially duringthe good years in order to make up forGDP lost during the bad years.

Even as we pursue the base case scenario,the biggest challenge remains as to howbest and fair the government couldjudiciously utilise the budget surplusesgenerated to mitigate the incomedisparity through careful calculations andallocation of resources to avoid theemergence of a potential economicunderclass. Globalisation and inclusivegrowth are not mutually exclusive andpositive interventionist policies forinclusivity have their places. Thechallenge for the government is to provehow income disparity can be addressedby enhancing inclusivity withoutretreating from globalisation in trade andfinance. Singapore being a small andhighly open economy with no directhinterland, probably does not have thatmany choices.

Why is Forging National ConsensusUnder a Renewed Social ContractImperative?

As Singaporeans become bettereducated, they are increasingly keen toparticipate in public policy formulationand often with vocal voices. Effective



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public policy presentations are thusessential if not paramount. However,there is an emerging danger, as it ishappening in Taiwan, Hong Kong,Thailand and Malaysia just to name a few,where citizens are becoming so inward-looking, totally engrossed in domesticpolitics and social debate, such that theentire government and bureaucracy areembroiled in conflicts and deadlocks, thusdraining away precious resources, timeand effort.

While all political and cultural debatesmay ultimately be local, engagement oneconomic discourse for Singapore should

Table 3: Simulation of GDP and ALP Growth, 2009 – 2020: Assumptions and Projections

Actual Pessimistic Base Case Optimistic Remarks1998 - 2008 Scenario Scenario

Labour share 0.532 0.532^ 0.532^ 0.532^ âssumed

Labour quality growth 1.24 1.00^ 1.24^ 1.50^ âssumed(%)

Capital accumulation 0.08 0.08^ 0.25^ 0.50^ âssumedenhancement

Capital quality growth 0.29 0.18^ 0.29^ 0.40^ âssumed(%)

Total factorproductivity growth 0.51 0.30^ 0.51^ 0.70^ âssumed

(%)

Employment growth 2.92 1.00 1.50 2.00 âssumed(%)

Productivity growth 2.52 1.79@ 2.67@ 3.61@ @projected(%)

GDP growth (%) 5.45 2.79@ 4.17@ 5.61@ @projected

Data source: The World Bank, http://data.worldbank.org/indicator, 2015

always take the global perspective intoconsideration. Rational public policiesmust thus prevail over irrational publicpressures. Most of all, public trusttowards public institutions and civilservants must not be breached. Apartfrom the conventional media and press,public opinion shaping and public policydissemination must be conducted closelyin connection with the HDB heartlanders,in particular through the bi-directionalpolicy feedback channelled fromcommunity-based grassroots workers.

Increasing public participation in publicpolicy consultation is a positive



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development. However, the type ofcitizen participatory model to adoptrequires careful consideration — Do wenecessarily want a confrontationalpolitical process of the two-partysystem or do we prefer a strong check-and-balance approach by oppositionparties on the incumbent governmentwith proven track record, bearing inmind that the choice for the lattermodel could very well eventually leadback to the first option? Singaporeanswill need to calibrate and contemplatedeeply their choice of government andthe political system that comes with itwhen casting their approvals.

References

Khee Giap TAN & Kong Yam TAN (2014),“Assessing Competitiveness of ASEAN-10 Economies”, International Journal ofEconomics and Business Research,pp377-398, UK.

Khee Giap TAN, Linda LOW, Kong Yam TAN& Lijuan LIM (2013), “Annual Analysisof Competitiveness, DevelopmentStrategies and Public policies on ASEAN-10: 2000-2010”, publishing servicesprovided by Pearson Education SouthAsia Pte. Ltd.

Kong Yam TAN, Abeysinghe TILAK andKhee Giap TAN (2014), “Shifting Diversof Growth: Policy Implications forASEAN-5”, Asian Economic Papers, MITPress, USA

Khee Giap TAN, Kong Yam TAN andLinda LOW (2015), “Annual Indices forCost of Living, Wages and PurchasingPower for Expatriates and OrdinaryResidents in World’s Major 103 Cities,2005-2013”, published by WorldScientific Publishing Co. Pte. Ltd.

Speech by President Tony Tan Keng Yamat the Singapore Chinese Chamberof Commerce & Industry SG50Outstanding Chinese Business PioneerAwards, 6th February 2015, Ritz CarltonHotel, Singapore.


Piyush Gupta is Chief Executive Officer and Director of DBS Group,as well as Director of DBS Bank (Hong Kong) Limited and The IslamicBank of Asia Limited. DBS is a leading financial services group inAsia, with assets of approximately US$300 billion, and with over250 branches across 17 markets. Headquartered and listed inSingapore, DBS is a market leader in Singapore with over four millioncustomers and also has a growing presence in Greater China,Southeast Asia and South Asia.

Singapore Economy

Development of Singapore’sFinancial Sector

Piyush Gupta


Development of Singapore’s Financial Sector

Singapore Economy

In 2012, DBS Bank bade farewellto our long-time home at Shenton

Way, and moved to a new headquartersbuilding at Marina Bay Financial Centre(MBFC) Tower 3. Being Singapore’s largestbank, our shift to the new premiseseffectively cemented the MBFC as thecountry’s new financial downtown.

Today, MBFC is a coveted businessaddress, and the Marina Bay area avibrant and thriving space thatepitomises the cosmopolitan, edgy citythat Singapore has become. So, it mightdefy belief that only 50 years ago, MarinaBay was an open sea.

Marina Bay’s transformation, from anopen sea to a barren reclaimed land to afinancial centre par excellence, is due tothe foresight of the Singaporegovernment. As early as the 1960s, itenvisioned the day when the CentralBusiness District (CBD) would need toexpand beyond the confines of ShentonWay. Reclamation works were initiatedlong before Singapore became a regional,global financial centre — long before theneed for that piece of real estate existed.

In many ways, the MBFC story isthat of Singapore’s financial sectordevelopment. It is a story of unparalleledsuccess, made possible by bold vision,detailed planning, and a relentlesspursuit of excellence.

Singapore is home to over 200 bankstoday, a growing number of which have

chosen to base their operationalheadquarters here to service theirregional group activities. The bankingsector has a total asset size of almostUS$2 trillion, and employs about 5.5percent of Singapore’s entire workforceof 3.4 million people, or over 180,000workers.

In 1960, per capita income in Singaporewas SG$1,310 (US$428). In 2013, it wasSG$69,000, putting the country amongthe richest in the world. Over the sametime, the financial sector’s contributionto GDP has risen from 3.9 percent (1960)to about 12 percent today. According tothe International Monetary Fund,productivity in Singapore’s financialsector has outperformed that in anyother financial centre worldwide.

Singapore is also heads and shoulderswith the big boys on the global league. Itis a leading wealth management centre,as well as the third-largest foreignexchange centre, behind London andNew York. Singapore is also Asia’sleading commodity derivatives tradinghub and according to some estimates,accounts for more than half of Asia’s over-the-counter (OTC) commodity derivativestrades.

The financial sector journey

As former Minister Mentor Lee Kuan Yewwrote in his autobiography From ThirdWorld To First, “anyone, who predictedin 1965 when we separated from



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Malaysia that Singapore would becomea financial centre, would have beenthought mad…It had a most improbablestart in 1968.”

As the story goes, Albert Winsemius, thenan economic advisor for Singapore,wanted to transform Singapore into afinancial centre for Southeast Asia within10 years. In a conversation with a Dutchfriend, he was told it could be done inthree or four years because Singaporewas advantaged by timezone differences.As Winsemius recounted, “He took aglobe and showed me a gap in thefinancial market of the world. Trading, heexplained, starts at nine o’clock in themorning in Zurich, Switzerland. An hourlater, London opens. When Londoncloses, New York is already open. Afterclosing time on Wall Street, San Franciscoon the American west coast is still active— but as soon as San Francisco closes,there is a gap of a few hours. This gap canbe fi lled by Singapore, should thegovernment not shun taking some drasticmeasures, such as cutting its links withthe British pound.”

At that time, Singapore was part of thesterling bloc and the Singaporegovernment was warned that it could notfollow Hong Kong’s example and set up aforeign currency pool or Asian dollarmarket. Hong Kong’s privilege was dueto historical, legacy reasons. Singaporewas warned that if it wanted to pursuethis path, it might have to leave thesterling area.

Lee Kuan Yew has shared in the past, “Atthat time, we were newly independent.We didn’t have the confidence on ourown to back the Singapore dollar. So Idiscussed this with Hon Sui Sen and said,‘Let’s go.’ So we told the British, ‘Okay,call off the sterling block, we are on ourown.’

While the British threat did not come topass in the end, Singapore’s financialsector was borne out of the gumption ofits founding fathers. Singapore had noneof the advantages which Hong Kong hadat that time — namely strong links to theCity of London nor the explicit backing ofthe Bank of England. Nevertheless,Singapore had the courage to challengethe status quo and break new ground,even when it risked upsetting theestablishment.

This same gumption and trailblazing spiritpervaded other aspects of policymaking.As an example, in the 1960s to 1970s,Singapore strived to attract multinationalcorporations (MNCs) to set up operationshere as part of its industrialisation effort.This initiative ran counter to theconventional economic wisdom of theday. MNCs, which were widely feared atthat time, exploited economies ratherthan enriched them. Not one to go withthe flow, Singapore pursued MNCsrelentlessly, and they provided the jobs,know-how and the knowledge transferthat helped upgrade the workforce.

As the domestic economy grew, the



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financial sector had benefitted. Thefinancial sector, in turn, had a knock-oneffect on the broader economy, spawningthe growth of supporting industriesincluding the legal and accountingprofessions — this helped create avirtuous circle of growth.

Singapore’s financial sector flourishedbecause the country was able tocapitalise on a timezone advantage. Morethan that, it had qualities which have setthe country apart all these years: politicalstability, a strong legal system, goodcorporate governance, physicalinfrastructure and an English speakingworkforce. In addition, Singapore has alsocultivated a reputation for being a well-regulated financial centre, and the abilityof our banks to come out of successivefinancial crises relatively unscathed hasfurther burnished our name.

Over the years, Singapore has alsocontinually sought to deepen its financialmarkets — the Singapore Exchange (SGX)continues to face intense competitionfrom Hong Kong, which has the benefitof a large China hinterland. Nevertheless,a supportive regulatory regime hasenabled Singapore to become the largestreal estate investment trust (REIT) marketin Asia and ex-Japan, while the SGXcontinues to draw listings from newmarkets. Our derivatives exchange is oneof Asia’s largest with the bond marketbeing one of the most developed in Asia.The asset management industry hasgrown in s ize and diversity, from

SG$276 billion in 2000 to SG$1.82trillion as at end 2013.

All these have been highly laudable giventhe prevailing challenges: talent shortage(stemming from the ease of mobility offinancial sector professionals), intensecompetition from rival hubs such as HongKong, and the emergence of new onesincluding Shanghai, as well as a smalldomestic market.

Nevertheless, I am positive about theprospects for Singapore’s financial sector.My view is that the financial servicessector will become even more importantfor Singapore’s economy moving forward,and will be crucial to drive its next phaseof growth. Assuming that the economygrows at its current medium-termpotential growth pace of 4 percent in thecoming years, the financial sector willaccount for about 15 percent of theeconomy 10 years from now. In terms ofworkforce, it should employ about 7percent of the entire workforce.

Looking forward

What accounts for this optimism? Ibelieve there are megatrends that willdefine Asia in the years to come andSingapore is well-positioned to capturethe opportunities before us. Theseopportunities include:

A growing middle class and risingconsumerism — gone are the days wheregoods produced in Asia are naturally



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shipped to the West. Asia, today, isgenerating more of its own demand, andthis will only increase. Increasingly, Asiancompanies are also supplying Asianconsumption demand. Consequently,there has been a shift from the traditionalhub-and-spoke trade architecture ofSMEs in Asia supplying to the UnitedStates (US) or Europe, to a spaghetti mixof trade patterns arising from more end-user demand in Asia.

With the increase in Asia connectivity,trade between China and India has grownexponentially, and China is now India’snumber one trading partner. Many of thelargest trade corridors also either end inChina or Singapore — this presents hugeopportunities for banks to work withthese companies across borders byhelping them set up in new markets,finance supply and distribution chainsand manage currencies, risks andworking capital.

Increasing consumerism will create largeopportunities for consumer finance.Growth in this area is reliant onappropriate policy frameworks forconsumer protection and robustinfrastructure for credit underwriting,credit bureaus in particular. As anindustry, we have made good progressin this area.

Second is rising affluence — Asia today iscreating wealth faster than anywhereelse in the world. This, coupled with theincreasing funds flow from Europe and

the Middle East, provide an obviousopportunity. Singapore has done well toposition itself as a wealth managementhub, based on a track record for safety,soundness and clockwork efficiency.Going forward, we need to continue togrow the community of asset managers,private banks and wealth advisors here.

Thirdly, as companies both big and small,begin to extend outside of their homemarkets, there are greater cross borderflows. The age of the Asian MNC is here,and the proportion of Asian SMEs whichbecome MNCs will only grow. Increasedregionalisation is beneficial to Singaporeas the nation is a hub for many Asiancorporates in this part of the world.

For example, there are about 6,000 Indiancompanies incorporated in Singapore —the largest base of foreign companies inSingapore is from India. They areestablishing trading hubs here and usingSingapore as a regional centre for foreigndirect investment (FDI). Most recently,Indian firms have begun thinking ofSingapore as a holding company base forall their businesses. The Singapore banksare not just being looked upon as a sourceof financing; they also provide to Indiancompanies a springboard to SoutheastAsia, and are a conduit into China. At DBS,for example, we are able to intermediatethe trade and capital flows coming fromIndia to the East.

Singapore is also growing in stature as amajor hub for a wide range of soft and



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hard commodities. We should continueto strengthen the banking industry’scompetencies so as to offer specialisedfinancial services.

Fourth is to do with infrastructure build-up — between 2010 and 2020, theaverage overall infrastructure investmentin Asia is expected to top US$750 billiona year. There is a huge thirst forinfrastructure investment. Singapore hasset up Clifford Capital, a specialistinstitution to plug gaps in projectfinancing. On DBS’ part, we are alsoworking with the World Bank to identifyand develop bankable projects in Asia. Inaddition, the World Bank’s investmentarm, the International FinanceCorporation (IFC), has set up in Singaporeits first asset management companyoffice outside of Washington DC to co-invest in regional infrastructure projects.

Fifth is the internationalisation of therenminbi (RMB), another trend thatbodes well for Singapore’s financialservices sector. According to Society forWorldwide Interbank FinancialTelecommunication (Swift), China’s yuanhas become the world’s seventh most-used currency for payments, overtakingboth the Singapore and Hong Kongdollars. Yuan trade settlement has alsoexpanded quickly since it first began in2009 with the percentage of China’s tradesettled in yuan risen to estimated 20percent in November 2013, from 12percent in 2012. Singapore has beennimble and quick to become an offshore

RMB centre and this bodes well for us asChina continues to internationalise itscurrency.

All things considered, the opportunitiesbefore us are tremendous.

Of course, as we move forward, there willbe hard issues to grapple with andchallenges that will require the samemettle, inventiveness and meticulousplanning that have gotten us to where weare today.

To stay ahead, it is imperative thatSingapore continues to build talent andmanagement platforms that can help thefinancial sector manage risks and grow.The financial services sector is ultimatelya people-driven business, and we alreadyhave a deep talent pool. However, whilea lot has already been done to groompeople in the industry, we need tocontinually raise the bar in training anddevelopment, such as through theFinance Industry Competency Standards(FICS) programmes. The MonetaryAuthority of Singapore (MAS) is steppingup efforts to build a strong core ofSingaporean specialists and leaders infinance. At the same time, to stayrelevant in the more complex financiallandscape of tomorrow, Singapore mustremain open to diverse talents andexpertise.

We must also ask ourselves: do we reallyseek to embrace being a global city? ForLondon and New York, the answer has



Singapore Economy

been unequivocal. In Singapore’s case,the jury is out because being a global citycomes with pluses and minuses such asgrowing income disparity. If we choosenot to be a global city, that brings intoquestion the economic and growthmodel that we seek to aspire to.

All in, I am bullish about Singapore’sprospects as the leading financial centrein Asia and positive that it can eveneventually be a ‘London’, that is tobecome an offshore Eurozone of Asia.Apart from the megatrends that willprovide tailwinds for our growth,Singapore has a strong rule of law, andmost alternate sites in Asia still havesome way to go in this aspect. Thecountry is also a massive aggregator offunds, and such money flows are hard toshift.

In December 2012, about two monthsafter inaugurating our new headquarters,DBS announced that we would beacquiring a 30 percent stake in MBFCTower 3 for over SG$1 billion. From beingthe anchor tenant of MBFC Tower 3, thebank now owns a stake in the buildinginstead. This represents our vote ofconfidence in Singapore and the futureof our financial sector.


Professor Joergen Oerstroem Moeller is Visiting Senior ResearchFellow at the Institute of Southeast Asian Studies (ISEAS). He isalso an Adjunct Professor at the Singapore Management University(SMU) & Copenhagen Business School (CBS) and a Senior Fellowwith the Ministry of Foreign Affairs (MFA) Diplomatic Academy.

Singapore Economy

The Hub Concept - Reflections on thePast, Projections for the Future

Joergen Oerstroem Moeller


The Hub Concept - Reflections on the Past, Projections for the Future

Singapore Economy

Over the preceding fifty years,Singapore has earned, by right, the

honour of being labelled the number onehub in the world – absolute leader,uncontested and indisputable.

In the prism of today, it seems obvious,almost self-evident, but this was far fromthe case when Singapore started to lookfor a way forward after independence in1965. In a way you could say that mostof the arguments against a success —small population, small economy, and asmall market —were turned on theirhead to become assets by plugging intothe role as a hub.

It could not have been possible withoutreading and interpreting the geopoliticaland geo-economic future developmentcorrectly. In 1965, the world was divided,grossly speaking, between a capitalistgroup of countries then led by the US, asocialist part spearheaded by the SovietUnion, and the so-called third world ornon-aligned group. Many analysts burnttheir fingers and look back at prognoseswith trepidation in case somebodyremembered! I have just recalled thataround 1950, the prevailing mood wasthat the ‘winners’ in Asia would be thePhilippines, Vietnam and Burma as it wasthen known — this is completely wrong!The forecasts and evaluations overlookedthe fact that it was not resource-richeconomies that would get the upperhand, but instead, it was countries thatwere able to assume control over theirown destiny and realise where they could

find and exploit a comparative advantage.Singapore did so through the hubconcept, just as China did so with DengXiaoping’s reforms.

This tells us that good governance, abilityto read future trends correctly and evenmore crucial the will to turn thesefindings into realities vastly overshadowsnatural endowment - resources.

It also tells us that political leaders mustmaster the ability to communicate to thepopulation on which course is being setand the reason for it. Otherwise, a nationcannot rally the majority of peoplebehind the chosen policy.

Political leaders must have the ability toadjust and adapt all the time. What isgood today may not be so tomorrow. Thefirst mover advantage is crucial whenadopting the hub concept amongst otherthings because success demandsinfrastructure investments often in a bigscale that cannot be changed ordiscontinued without large costsincurred. It may be suffice to recallinvestments in harbour facilities andairports where countries are stuck withinvestment undertaken or incurringopportunity costs for lack of investment.Mistakes cannot be remedied with just asnap of the fingers.

Singapore being nimble and adroit maybe easier than larger countries, but thisdoes not distract from the achievementsof those who saw what was coming and



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made the country ready. There is an oldsaying that opportunities come to thosewho are ready for them — and in thisrespect, Singapore scores well. The firststep was, as has almost always been thecase, to start with labour- intensive andlow-cost manufacturing. Apparel is theclassic example — it also worked forSingapore, but only for a limited time.

The next step was to exploit thegeography by building harbour facilities.If the British Empire saw Singapore’sgeography as an asset and built a navalbase, then the same would probably betrue for shipping. Transport to and fromSingapore is very limited, in view of thesmall Singapore market. However, aharbour serving as a hub for transport inand out of the region promised a largermarket.

Singapore may have been lucky in thesense that the global supply chain builtaround outsourcing and offshoring tookoff in the 1980s giving harbour facilitiesof this kind - transhipment - aphenomenal boost, but the crucialobservation is that this could have beendone by everybody in Southeast Asia, butwas only done successfully by Singapore.First mover advantage paid offhandsomely as the competitors took timeto build facilities. This enabled Singaporeto shape a good relationship with the bigshipping liners and container transporterswhilst gaining experience in handling thisapparently simple operation, but it wasin fact, rather sophisticated if done

adhering to cost effectiveness.

The same can be said about Changiairport and Singapore Airlines. In factvery few would have dared to predictthe success of these two cornerstonesof Singapore’s economy. There is noreason why Singapore should get thisbig slice of the cake outmaneuveringother countries, cities, or airportswithin the region with a larger domesticmarket, except of course, thatSingapore spotted the opportunity firstbefore everybody else — first moveradvantage.

Information technology activities andendeavours to build an industry aroundInformation and CommunicationTechnology (ICT) brought along thedistinction of being among the top ofthe group of ICT countries in the world.This is good in itself, but moreimportant is the spinoff effect reducingcosts and enhancing opportunities fordoing business, making it attractive toset up a regional or even an Asianheadquarters in Singapore.

The whole idea of good governancearound effective and efficientadministration has underlinedSingapore’s role as the place where, byfar, most international companies go toset up headquarters, research orfinancial services. This producesanother spin off effect drawing talentedpeople to Singapore enhancing theintellectual capital of the nation.



Singapore Economy

This so-called first phase of the hub wasmoulded around traditional economicand industrial sectors. What is not alwaysincorporated in analyses is that itannounced Singapore as a global player,albeit in very select and narrow sectors,while at the same time branded thenation as an island of efficiency, goodgovernance, corruption-free andrespecting the rules of the law.

The next step to opening up newactivities was moulded around theservice sector. This was more difficult todo and the risks were higher, but thebranding as a place for good governancehelped.

Singapore’s financial sector has becomeone of the strongest in the world today.It is almost boring to reiterate that it wasfar from the obvious to position itself asa financial hub with Tokyo and Hong Kongalready established and Shanghai andMumbai coming up — but it succeeded.The difficulty was and still is to strike theright balance. Being a successful financialhub requires good facilities in a broadersense and having good governance. Ifuncertainty starts to reign, money andsubsequently the financial service sectorwill move. The costs of doing so arebearable for the large financialinstitutions. The international efforts ingaining ground to combat moneylaundering and obscure financialtransactions, including harbouringdubious person’s and/or organisations’money, forces a financial hub such as

Singapore to act according to, not onlyto international rules, but also to moraland political guidelines. Unless one isseeing what is in the pipeline, there is arisk of being caught and placed undersuspicion. Being a hub for global moneyembeds fragility and vulnerability andfew things can move faster in and outthan money. For Singapore, that impliescontinuous high quality vigilance and notmisjudging legal and moral borders.

Health care and education has followedadopting the hub concept. Theinteresting aspect is cost and qualityweighed against each other. People goingfor an operation will do this calculationas will those sending their children foreducation. Singapore is at the higher endand that is good, however, the challengeis to make sure that the higher qualitymatches the higher prices.

Leisure and culture has joined the list. TheEsplanade (nicknamed the Durian) hassince signalled a new approach, whichwas fully seen with the two integratedresorts. Singapore tapped into the vastflow of money in the slipstream oftourism namely entertainment such asFormula One and gambling. The latterwas a hard nut to swallow — over pastdecades, gaming and gambling wereallowed, but under tight control. Theintegrated resorts with their casinosposed the same dilemma as the financialsector, but in a much harder manner — abalance had to be struck. Inevitably,much of the money and many of the



Singapore Economy

people coming to gamble have hadquestionable backgrounds. How do weensure that procedures and controlswere able to prevent a dent in Singapore’simage as a low crime country? In a way,Singapore acquiesced to a low keyrebranding to become less ‘boring’ andmore ‘adventurous’. This decisionillustrates the dilemma sometimesassociated with the hub concept.Singapore could have said “no” to thecasinos, but the consequence wouldnot only have been to forego this kindof business, but also to see otherentertainment and leisure activities goelsewhere — a potential negative spinoff.

The main lessons garnered, so far, canbe summarised to: Governance andforesight are the ultimate andindispensable conditions. As a high costsociety, quality must constantly beenhanced to match the higher costs. Forthe financial sector and gamblingactivities constant vigilance to respectinternational legal rules and to detect andintercept swings in moral attitudes aredifficult, but indispensable.

The hubs stemming from the first andsecond wave have considerable mileage,but it cannot be skirted that they are onthe downward slope and has to besupplemented by what is termed a thirdwave. What then are the opportunitiesto look out for?

The global supply chain is going to bereplaced by regional supply chains. The

global business cycles ceased to existsince two decades ago and an East Asianbusiness cycle emerged. The implicationis an ability for the region to shape its owneconomy and not be a hostage any longerto the US (and European) economy.Figures for intra-trade (trade among agroup of countries) as a share of totaltrade reveals around 55 percent amongEast Asian countries compared to 64percent for the European Union (EU) and45 percent for The North American FreeTrade Agreement (NAFTA).

McKinsey Global Institute[1 yes] comesto the conclusion that Southeast Asia canbenefit from this development in threeways:

‘Firstly, successful implementation of theASEAN Economic Community integrationplan could significantly increase tradeand create a single market of 600 millionconsumers. Secondly, ASEAN canexpand its free-trade agreements andattract additional production frommultinationals as labor costs in Chinacontinue to rise. Together, theseopportunities could create some $280billion to $625 billion a year in economicvalue by 2030. To realise this potential,ASEAN will need to tackle restrictions onforeign investment, to develop a morecompetitive manufacturing sector, and tobuild critical foundations, such asinfrastructure, logistics, and workforceskills.’

This trend will strengthen over the



Singapore Economy

coming decades. East Asia will graduallyincrease production for consumptionwithin the region instead of exports. Itwill also be the same for South Asia,albeit this may take a little more time.Prime Minister Modi of India has tabledan economic policy analogous to theitinerary followed by East Asia, aimed atmoving into labour-intensive and low-cost manufacturing.

Singapore will be enviably well situatedto exploit these new trade patterns. Itmay require some new infrastructure ascontainerships for regional transport maybe of different sizes than those built forglobal transport and the trade inresources such as bulk shipping, may notgo through Singapore. However, thatwill only dent and not remove theopportunities.

A massive restructuring of global trade isunder way for energy. Watching theworld’s energy supply and demand, anumber of factors work against globaltransport. Shale gas and oil are foundinside all major industrial countriesexcept in Japan. Self-sufficiency forstrategic and geo-political reasons is inthe vogue. Oil may give way to coal andLNG (liquefied natural gas). Exploitationof the hub’s opportunities asks for correctreading of these new patterns and willundoubtedly require infrastructureinvestments to be in place before theyreally set in.

Broadly speaking, global trade over the

last fifty years have been steered by anEast-West axis — a supply chain withproduction in Asia and consumption inthe US and the EU, supplemented bytransport of resources along the sameaxis with some, but minor exceptions.

The axis now swings to run from China,over South Asia and on to Africa. Everyyear, these three geographical areasaccount for an increasing share of worldpopulation, the lion’s share of globalgrowth, a higher share of global income,and a rising purchasing power.

It is too early to sketch a final model, butit would look somewhat like this: Chinawill transfer labour-intensive and low-cost manufacturing to some countries inSoutheast Asia (Vietnam, Indonesia andmaybe Myanmar), but primarily toBangladesh which is already benefitting.The same goes for Pakistan as well asIndia which is coming up even faster ifPrime Minister Modi’s policy succeeds.The substitute for labour-intensive andlow-cost manufacturing in China willbe higher value-added productioncompeting on quality, service,technology, and branding. Africa will, forthe first decade or two, step into the roleas a supplier of resources (energy and rawmaterial), but as time goes by, its risinglabour force combined with the effect ofhigh growth will attract manufacturing.

Approaching 2050, it is likely,almost certain, that labour-intensivemanufacturing will have completed its



Singapore Economy

transfer from China to South Asia, and beon its way to Africa. People have longspoken about China as an economicpowerhouse, but China’s rise will benothing compared to the axis of China -South Asia - Africa.

For Singapore, this is mixed news.Geographically, it will find itself on thefringe of the new power axis. Thechallenge is, however, more for SoutheastAsia as a whole. The region iseconomically too small to serve as aviable platform for economic growth. Itnot only strengthens the well-knownarguments to plug into the Chinese andJapanese markets, but adds a newdimension which is the ability to be partof the new growth scenario. If SoutheastAsia can do that, and omens are lookinggood with economic and industrialstructure, the region may benefit andSingapore, as a hub in Southeast Asia andpart of the East Asian supply chain, mayfare even better than what the globalsupply chain offered.

The industrial age is coming to an end —economic and industrial structures builtaccording to the needs of that agebecome obsolete. The coming age will beshaped by scarcities. The world canalready now feel food shortages, risingresource prices combined with physicalscarcities for some resources, an energyproblem, water scarcity for almost half ofglobal population, and clean environmentas something which cannot be taken forgranted.

It is a safe bet that those cities andcountries, knowing how to use resourcesefficiently, recycling resources andmoving into re-manufacturing and anumber of other measures to reduceresource use will be the eventualwinners. Many policies to this effect canbe implemented. One of them is theshifting emphasis of research,technology, innovation, and invention,from the saving of manpower, whichsteered the innovation processthroughout the industrial age, to thesaving of resources.

For a small and nimble society such asSingapore, this can be done and the City-state has within its grasp, the ability toposition itself as a hub for application ofthe new paradigm which controlsproduction and consumption.

Urbanisation may well be one of the mostimportant issue in the decades tocome and focus will be on sustainablecities, liveable cities, and cities whichmanage to save resources. What can bebetter for Singapore than taking the leadhere?

Above this comes an offer Singaporecannot refuse! Most societies around theworld move, unfortunately, toward moreviolence making people feel insecure.There is a growing demand for humansecurity in a broader sense —the abilityto be able to walk safely in the streets,no fear of robbery, and no worries forchildren’s safety — essentially, a safe



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haven for human beings. Those wholook for such a place are welloff. Strengthening its image, and it will beeasy as a quality society, Singapore willattract such people. It fits in very nicelywith the trends sketched above as a third-generation hub.

Taken together, the futuristic view for thenext fifty years conveys the hub conceptas very much alive. It only requires thesame adroitness and ability to adjust andadapt as seen already over the first fiftyyears. Governance, boldness, and correctreading of future trends are called for. Itis not easy, but indispensable forSingapore if it wishes to maintain its hard-won place as one of the best societies inthe world — a high quality society.


Dr Bilveer Singh teaches at the Department of Political Science atNational University of Singapore (NUS) and is also an Adjunct SeniorFellow at the Centre of Excellence for National Security (CENS),S Rajaratnam School of International Studies (RSIS), NanyangTechnological University (NTU). He is also President, Political ScienceAssociation, Singapore.

Security & Defence

50 Years of Singapore’s Securitisation:Prospects and Challenges

Bilveer Singh


50 Years of Singapore’s Securitisation: Prospects and Challenges

Security & Defence

Introduction

Singapore was born in a securityconundrum — it was barely

eleven months after the second racialriots (September 1964) in the then Stateof Malaysia, and Konfrontasi (theIndonesian–Malaysian confrontation),the limited war launched by PresidentSukarno against Malaysia (includingSingapore) was still ongoing. Singapore-Malaysia relations were tense anddifficult with fears not just of a federalgovernment takeover of Singapore butpossibly more racial riots.

The global Cold War was intense and theAmerican-led war in Indochina, to stopthe Communist march and prevent‘dominoes’ from falling, was at its heightafter the Gulf of Tonkin Incident. TheGreat Powers, especially the UnitedStates (US) and the Soviet Union, wereintensifying their Cold War struggle forinfluence and domination, includingwithin Southeast Asia, best evident intheir involvement in V ietnam andIndonesia. It was under suchcircumstances that the republic’sleadership had to craft a security policyto safeguard its infant sovereignty and apolicy of securitisation was essentially theanswer to these challenges.

What is Securitisation?

In the field of international relations, thisconcept is associated with theCopenhagen School of scholars such as

Ole Waever, Barry Buzan and Jaap deWilde. While the material disposition ofa threat, including military strength anddistribution of power, is important,securitisation entails, through ‘speechact’, the transformation (throughpoliticisation) of certain issue(s) by anactor into a security issue. This will enablethe state apparatus to use various meansto act in the name of security. Tounderstand securitisation, there is theneed to know the actor or entity thatsecuritised the issue, the object that isbeing threatened or that needsprotection, for whom and on whatgrounds is something being securitisedand what the outcome(s) was.

For securitisation to be effective, it mustbe accepted by the audience, namely, theelectorate that needs to be convinced ofthe threat. If an issue is successfullysecuritised, then extraordinary measurescan be legitimately undertaken toaddress the threat as it would have beendefined as an issue of vital priority for thestate and its people. Here, not only canpurely military issues be securitised butissues in the political, economic, societaland even environmental sectors can bemobilised for securitisation purposes.

In short, every policy can be seen from asecurity angle, with a State defining‘security challenges’ from various anglesand justifying strong measures to betaken against identified threats in thename of national security, regardless ofwhether an actual threat exists or



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whether the issue involved state orregime security.

The Securitisation of Singapore

As securitisation entailed viewing everyaspects of the State from a security angle,internal and external or from the military,political, economic or social-culturalaspects, it would be instructive to analysewhat has been undertaken since 1965 toneutralise the various threats in the nameof achieving development, stability andsecurity. In essence, it involved thegovernment’s intervention in almost allaspects of the State and viewing everychallenge from security lenses.

Political

Following a bruising struggle with the Leftand pro-communist elements includingwithin the People’s Action Party (PAP),once the PAP became the government ofindependent Singapore, its approach topolitics was to ‘depoliticise’ it. Thisapproach was reinforced further by thePAP’s continued conflict with theMalaysian leaders over various issues,including race and religion, and mostimportantly, following the two racial riotsin 1964.

This saw the government’s attempt toclip not just the operation of theopposition parties such as the membersof the Socialist Front, then the leadingopposition party in Parliament until itabandoned parliamentary politics in

1966, but also other political parties suchas the Workers’ Party as well as to curbthe growth of civil society. These politicalgroups were seen as a source of nuisancethat distracted the government from itstask of providing development andsecurity goods regardless of itsimplications for democracy and the needfor a system of checks and balances aswell as accountability.

Economic

As a resourceless State made up ofmigrants, providing economic goods wasa key strategy for attaining nationalstability and security. This led to theeconomic-first, ‘at all costs’ approach toeconomic development. One of the keytargets of securitisation was the tradeunion movement that had, prior to 1965,been largely communist-controlled withstrike actions and the accompanyingman-hour loses one of the keyweaknesses of Singapore’s economy. Inorder to attract foreign investments todrive economic growth, the labour sectorhad to be made attractive, not onlythrough cheap, skilled workers, but alsowith a peaceful, non-threateningworkforce towards foreign multinationalcorporations (MNCs) that were broughtin to drive Singapore’s exported-orientedeconomy.

Social-Cultural

To provide a secure environment for amulti-racial entity to coexist in a political



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setting of respect and stability, especiallyafter the racial and religious violencefollowing the Maria Hertogh riots in 1950and the racial riots in 1964, was one ofthe key factors driving the government’ssecuritisation policy. The government’sexperience with Chinese chauvinists,often controlled by the communistunderground, championing Chineseeducation and culture, were clearreminders that this sector of society hadto be depoliticised. Any attempt by anyracial or religious group to championnarrow racial, religious and languageissues was viewed as a security threat anddealt with harshly. The arrest of theNanyang Siang Pau editors, the leadingChinese daily in May 1971, on charges ofchampioning Chinese chauvinism, wasevidence of this security-orientedmindset.

Military

A Singapore that exited from Malaysia inAugust 1965 was left with only twoinfantry battalions and that too,composed mostly of Malays and manyMalaysians. In response to the diremilitary situation of having almostminimal military strength to defend itself,very quickly with Israeli’s assistance,Singapore built up a National Servicesystem, through conscription that quicklyprovided military muscles for therepublic, especially following the Britishmilitary withdrawal in 1971. WhileSingapore was a member of the FivePowers Defence Arrangements, the loose

pact’s value was more political thanmilitary, especially in the context of poorSingapore-Malaysia relations. Hence, apolicy of military built up with more thana quarter of the national budget wasdevoted to defence.

Foreign Policy

In addition to various domestic political,economic and social-cultural policies,foreign policy was also structured toenhance national security. Within twoyears of independence, Singaporedeveloped close all-round ties with theUnited States (US), the de facto securityprovider in place of the withdrawnBritish. This saw the slow but steadyalignment of Singapore towards the USand eventually, the development of aquasi-alliance relationship withWashington by the 1990s. Singapore alsoadopted a foreign policy premised on thebalance of power, inviting every majorstate with stakes in the region, to have atangible political, economic and evenmilitary stake in the republic. This wasbased on the belief that a totaldependence on a single power wasdangerous, but if there were ‘multiplesuns’, then the rays would mute eachother, providing tiny Singapore withspace to manoeuvre.

The Outcomes of Singapore’s 50 Yearsof Securitisation

Essentially, a ‘4-Ds’ approach wasadopted. This entailed domestic



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development that emphasised oninternal stability, economic developmentand the development of a political entitythat valued the benefits of all-rounddevelopment, especially economic andthe physical stability that was providedby a strong state. This also involved givingeach racial and religious community astake in the development of the republicthrough a policy of multi-racialism, multi-culturalism, multi-religiosity and multi-lingualism, where everyone’s key identitywas protected and yet, national-orientedvalues were promoted for nation-buildingtasks.

By and large, through trickle-downeconomic benefits, the state’s strongcontrol of the mass media, containmentof oppositional and civil society’s politics,and the provision of basic human needssuch as housing, jobs, education andphysical security, the ruling governmentsucceeded in providing all-round political,economic and social-cultural goods thathelped to entrench the ruling party inSingapore’s politics through basicperformance legitimacy. The leadershipof Lee Kuan Yew, Singapore’s primeminister from 1959 to 1990 as a strongand charismatic leader, also ensured astrong, stable and prosperous state.

A sound diplomacy, winning regionalfriends and developing profitablerelations of mutual benefits with greatpowers was equally critical for nationalsecurity. The development of a strongdefence capability which included

effective defence diplomacy, was thethird leg on which national security wasunderpinned. Despite being a small statewith limited manpower resources,through mandatory male conscription ofNational Service and effective defencediplomacy, a strong defence capacity wasdeveloped which underpinned therepublic’s survival. This provided theinsurance policy for foreign investmentsand guaranteed the republic’s ‘big stick’while speaking softly in regional andinternational politics. Together, thesepillars provided deterrence to potentialadversaries in the hope that if this failed,there then would be an effective defencecapability to safeguard the republic.

Challenges Confronting Singapore’sSecuritisation Policies

While many of these policies provedsuccessful in the past, their futuresustenance is questionable. This is due toa number of factors: Firstly, for many ofthese policies to continue to remainrelevant after fifty years is in itselfchallenging. Many things have changed— the first and second generation ofpolitical leaders are no longer in powerand a new generation of Singaporeanswho are more educated, informed, well-travelled, economically successful,politically confident and highlydemanding, have grown up.

There have been a rise of new problems,many of them a consequence of the PAP’ssuccesses, including rising income



Security & Defence

disparities, unaffordable basic needs suchas housing and medical care, breakdownsof public infrastructures such as MassRapid Transit (MRT) and massive trafficjams despite rising costs imposed on thepublic through all kinds of direct andindirect taxes such as Certificates ofEntitlement (COEs), Electronic RoadPricing (ERPs), and so forth.

Secondly, unlike in the past, there hasbeen the rise of a credible politicalopposition that has harvested thesegrievances to its advantage, particularly,the rise of the Workers’ Party, oftendubbed the ‘PAP of the 1960s’. This hasbeen greatly aided by the social mediawhich has succeeded in bypassing thegovernment-controlled mainstreammedia, thereby giving the Opposition apowerful voice as well as the voiceless ofthe past being able to make theirpresence felt politically, especially thosewith grievance.

Thirdly, the government, while in thepast, was perceived as the saviour of therepublic, through its sound political,economic, social-cultural policies andsolving the basic needs problems of thecitizens, is now increasingly blamed formany of the electorate’s woes, especiallyrising costs. Here, the single biggestbugbear and milestone around the PAPis the issue of flooding the ‘little red dot’with foreigners who are perceived as aneconomic, social-cultural and potentially,a political threat. The PAP government’seconomic rationale that has justified this

human flooding, mostly from China, isunacceptable for the majority of theelectorate — a government versus theelectorate clash is likely to be intensifiedin the coming years. With a public totallyopposed to foreign nationals flooding thenation, the government is unlikely to winin the confrontation.

Finally, in view of the manifold nationalproblems, there is a rising publicperception that the quality of the PAP asa political and governing party hasdeclined, and if it is not robustly checked,it could result in negative consequencesfor the public at large. The PAP’s leadersintermittent reference to the fact that nopolitical party has ruled for more thanseven decades has also not helped, givingthe impression that the days of the rulingparty may be numbered.This has led tothe perception that the ruling party mightbe replaced in future, especially if acredible opposition rises and captures theimagination of the electorate.

The Future: De-securitising Singapore’sPolitics as part of the New Normal

The various problems facing the PAPgovernment, especially since the 2011general election, has led to growingvoices being raised against thegovernment’s policies, with the pastsecuritisation approach being nibbledaway and in many areas, totallyundermined. The government’s ownapproach has also been helpful, bestevident in being more respectful and less



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punitive of the electorate’s critical views,in accepting opposition parties as anintegral part of the political landscape,being more forthright in admitting itsmistakes, and increasingly embracing amore welfare-oriented agenda for thepublic.

Most glaring has not been just aresurgent political Opposition but alsothe rise of a highly politicised public andcivil society. In the last five years or so,Singapore has seen more public outcriesand protests against government’spolicies than the four and the half-decades earlier. This is symptomatic ofthe fact that the past government’sapproach of labelling every majorpotential challenge as a security threat,is no longer viable and tenable in the faceof an assertive and political public. The‘coming to life’ of Hong Lim Square isclear evidence of this phenomenon andthe ‘Honglimisation’ of Singapore issomething that cannot be ruled out in thenear future. This would be the ultimatedeath knell of PAP’s securitisationpolicies, marking the return of totalpolitics to the Singapore arena andsignifying Singapore’s graduation as aFirst World political state.

How long the PAP survives, as a governingparty will in turn be dependent on theparty’s ability to address nationalproblems, connect with the electorate,the quality of the Opposition and thevarious circuit breakers which thegoverning party is able to place in the

system to prevent the defeat of the partyin the upcoming general elections. Whilethe chances of an immediate change ofgovernment due to the increasing de-securitisation of national politics areunlikely in the near future, the return ofnormal political contestation would tendto signal that a new political era is on thehorizon, one that befit a political entityand society that is highly developed.


Professor Mohammad Amien Rais graduated from the Universityof Notre Dame and was conferred his PhD in Political Science fromthe University of Chicago. He was the Chairman of the People’sConsultative Assembly and People’s Mandate Party [PAN] and hasbeen awarded the Fulbright, as well as the Rockefeller Scholarships,and conferred the Bintang Mahaputera Utama, the Indonesian statehonours, by President B J Habibie.

External Relations

Building on a Foundation of ConstructiveIndonesian-Singapore Relations

Mohammad Amien Rais


Building on a Foundation of Constructive Indonesian-Singapore Relations

External Relations

Singapore gained itsindependence from Malaysia at

about the same time Indonesia wentthrough a change in political climate in1965. The then Prime Minister ofSingapore, Lee Kuan Yew took on themantle at about the same time the thenPresident of Indonesia, Soeharto purgedthe country of Communists andembarked on a sustained period of socialand economic development. Bothnations started their journeys in the mid-1960s confronting similar circumstances.The leaders of both nations facedprecarious economic conditions and thelooming threat of communism that wasbent to dismantle the young democraciesin the region.

Looking back fifty years, Indonesia andSingapore had shared a somewhatcommon vision and direction in bringingour region together. It is truly anawkward, yet fulfilling relationshipbetween an island City-state that has hadphenomenal appetite for growth as wellas being the largest archipelago in theworld that has experienced several cyclesof tumultuous political changes. Despitethe trials and tribulations of globaleconomic, financial crisis and the threatof terrorism, both nations emerged assignificant anchors of ASEAN and otherintergovernmental organisations. Thefoundation in bilateral relations is stableand likely to lead to closer collaborations.

Taking a cultural perspective, Indonesiaand Singapore share historical roots that

date back several centuries. Ourexistence has always been characterisedby the reliance on vital trade routes whichconnected the economies along the eastof the Straits of Malacca to those acrossthe Indian and Atlantic Oceans. Ourethnic communities had crossed borderslong before these borders had beendefined by Global Positioning System(GPS) positions. The Malays and theChinese in both countries share familyties. These migrant communities onlystarted to take on differing politicalorientations under the British and Dutchrule.

Given that Indonesia and Singaporeshares so much of the past, is it possiblethat globalisation and intensecompetition could change both countries’bilateral orientation in the near future?Can we foresee an antagonisticrelationship between the leaders andpeople of the two countries? What couldcause a rift between the two nations?Before I discuss the trends that will shapeour bilateral ties within the next fiftyyears, I shall lay out the rubrics of whatmade the past fifty years meaningful.

What factors and events had shapedthe last fifty years?

Let us go back to the formation of ASEANin 1967. The ASEAN Declarationembodied a common desire betweenIndonesia and Singapore to bringtogether the neighbouring economies.The main idea was to create common



External Relations

programmes to foster economic growthand establish regional peace. Lee KuanYew and Soeharto had taken the strategicdecision to put aside the recentKonfontasi (1963-1966) and garnerMalaysia, Philippines and Thailand withthe intent of building a collaborative frontagainst the concerted and systematicCommunist infiltration into the region.The commitment to establish and sustainactive collaboration within economic,social, cultural, technical and scientificsectors has given rise to concreteachievements that we tend to trivialiseor forget.

If Konfrontasi had become the stumblingblock, Indonesia, Singapore and theregion would not be where it is today. Itwould be difficult to envision that bothcountries would have been able to buildsubmarine pipelines to transport gasfrom South Sumatera and Natuna toSingapore. It would be impossible toconceive that Singapore would be able tocarry out decades of reclamation work toexpand its territory with sand and granitebrought in from Batam, Bintan andKarimon.

The leadership factor is crucial.Singapore’s visionary and level-headedLee Kuan Yew and Indonesia’s growth-oriented Soeharto had been instrumentalin putting their bitter history aside andforging bilateral ties. That foresight theyhad shaped the present — Soeharto wasconfident that Singapore’s growth wouldnot threaten Indonesia and so began a

symbiotic relationship. If history hadtaken a different route, Soekarno,Indonesia’s first President, would nothave been so calm in forging economicties with Singapore or Malaysia.

The geopolitical circumstances that hadsupported this healthy Indonesia-Singapore relations was also different inthe last five decades. In 1965, thedominant global power was the UnitedStates (US) while the United Kingdom(UK) and the Netherlands were verymuch in retreat from its colonies aroundthe world. The US engagement inVietnam and Korea, during the period ofdecolonisation, led to a mindset that itneeded strong allies in the south of thewar zones for its logistical support. Theseallies also had to become a firm wall toprevent communism from taking grip ofSoutheast Asia.

Both Indonesia and Singapore are knownfor its constructive strategic military tieswith the US for many decades. The pro-capitalism and anti-communism mindsetbecame the underlying factor indesigning the defense policies andcapabilities of Indonesia and Singapore.Both militaries share similarconfigurations of military hardware andhave coordinated their mobilisation asjoint forces. This shoulder-to-shoulderposture is evident in the decades ofcoordinated patrols of strategicwaterways such as the Straits of Malaccaand the Singapore Straits. Both militarieshave also participated actively in joint



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exercises such as SAFKAR INDOPURA —The regular exchange of strategies by topcommanders from both sides foster trust.

Despite occasional politicalmiscommunications, the goodwillremains strong because of the commonstrategic interests of defending oursovereignty and economic lifelines. TheSingapore Armed Forces has beenproactive in responding to the 2004earthquake and tsunami in Aceh as wellas in the disasters affecting Yogyakarta in2006. To date, the only significantoutstanding treaty dealing with strategicmatters has been the Extradition andDefense Cooperation Agreement (ET-DCA). It hit political hurdles during theYudhoyono government, and the newJokowi administration has littlemotivation and ability to pursue thematter in the Indonesia House ofRepresentatives Dewan PerwakilanRakyat (DPR).

To some extent, the key factor thatcharacterised the calm relations in thelast five decades. Singapore andIndonesia had been contented to take onspecialized roles. Indonesia focused ondeveloping its natural resources sectorwhile Singapore had a supporting role inchanneling investments through itsglobally connected finance sector.Soeharto, Abdurrahman Wahid, andMegawati Soekarnoputri were contentedwith Singapore as the principal trade andbusiness conduit to the world.Investments in Indonesia were largely

done through Singapore — Indonesianshad been content to be the naturalresource hub in the region exporting oil,gas, copper, nickel, coal and many othermining commodities through companiesand brokers that were largely operatingout of Singapore.

The contentment is so clear in the caseof Indonesia’s dealings with the twomining giants, Freeport Mc-Moran andNewmont Mining. For decades, they hadbeen exporting raw mining commoditiesand had not been motivated to set upprocessing plants locally. Mining andplantation deals were inked in Singaporeand the banking arrangements werewired through the many internationalbanks based on the island. Singapore wasalso the preferred location for arbitration.

With that mindset, the past Indonesiangovernments had not objected toSingapore’s continued management ofthe Flight Information Region (FIR)over critical Indonesian territories.Indonesians had been confident that theywould remain the crucial hub for energyand mining supplies where the politicalleadership allowed Singapore to haveaccess to companies that controlledcrucial services such as banking andtelecommunications. At presentSingapore has a significant stake inIndonesia’s banks, mobile phone serviceproviders and access to the vastIndonesian consumer markets whileIndonesia itself does not have reciprocalaccess.



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The Indonesian government has been sopreoccupied with the constitutional andpolitical reforms and decentralisationthat it had overlooked how Singapore hadtaken a strategic stake in the country.While the bilateral ties remain cordial,Indonesia is rethinking the role ofSingapore as the place where the dealsare made. Intensive globalisation haschanged the old roles and expectations.Whatever that worked in the past is notlikely to be easily accepted as the normswith future bilateral relations.

The underlying factor in the strongbilateral ties remain the sharing ofinformation, particularly intelligence andinsights into policy development. Thegenerous scholarship programmes hasenabled bright students from Indonesiaand Singapore to partake in joint humanresource development initiatives. Tosome extent, the leadership of bothnations think alike and have the samecompetitive mindset with policydevelopment. Leaders on both sides havebeen largely aligned when working on theASEAN Economic Community (AEC)blueprint, the ASEAN-China Free TradeArea Agreement (ACFTA) and on thepossibilities of making the Trans-PacificPartnership become workable. All thesemilestones would not have been possibleif the bureaucracies on both sides did nothave cordial and functional ties.

The most significant collaborative areahas been the sharing of intelligence incombatting terrorism since 2001.

Indonesia has been proactive in sharinginformation on Jemaah Islamiyah andother terrorist cells from its experiencein investigating the perpetrators of theBali and Jakarta bombings. Thecooperative stance of Indonesia’sNational Intelligence Agency (BIN)towards Singapore has helped, to a greatextent, in averting a terrorist attack onthe island. It is clear that as neighbours,Indonesia shares the concern on the riseof terrorism as a destabilising factor.

What factors and events will shape thenext fifty years?

The ties between Indonesia andSingapore will pivot on our ability asneighbours and a region to come up withsustainable solutions to a looming energyand ecological crisis. Both economies aredependent on imported oil supplies —Indonesia’s daily oil consumption haslong outstripped its domestic production.However, Singapore imports all aspectsof its energy needs. Whateverexploration and refining capabilitiesIndonesia develops will not likely meetour long-term demand for fuel, especiallyas population continues to grow. Anysustained military conflict in the SouthChina Sea between China and theclaimants to the disputed territoriescould cause energy price fluctuations andtrade disruptions that would impactSingapore and Indonesia. Any geopoliticalincident that causes spikes in oil and gasprices would hit both economies hardand slow down economic growth



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significantly. Given domestic energysecurity concerns, Indonesia would likelyalso review its gas export commitmentsto Singapore, Japan and China in thecoming decades, causing strain inbilateral ties.

How could Indonesia and Singapore focuson energy security given the knowledgebase, experience and financial resourcesbetween both countries? How possiblewould it be for leaders on both sides toconsider collaboration in nuclearelectricity generation to supply acommon electricity grid managed by theprivate sector of both countries? — thisis not impossible. Soeharto hadenvisioned and planned to sell waterfrom the rivers of Sumatra to Singaporevia undersea pipes. That proposal hadbeen investigated and even reached thelevel of proposals engineering-wise. Asearly as 1986, ASEAN leaders hadproposed to work towards a regionalelectricity grid. The proposals have manyoutstanding cross-border issues and a lotof technical challenges involving the 10economies. Can the initiative begin withIndonesia and Singapore taking the leadon nuclear-generated electricity?

The nuclear disasters in Fukushimarecently may have caused many nationsto reconsider the option of nuclear-generated electricity as a safe and viableoption. However, given the currentavailable technologies and the growingdemand for electricity in all sectors of theeconomy, we face few sustainable and

affordable options. Perhaps it is time tosit together as neighbours to discuss theregulations, concerns and the potentialof being the incubator of the regionalpower grid.

Indonesia-Singapore collaboration in thesecurity and defense sectors will givenew definition to bilateral relations.Admittedly, for a small island nation,Singapore has enough military capacityto defend its national interest and toproject its influence beyond its borders.It has an established defense industry andis established as the regional hub formilitary avionics. Indonesia has similarcapabilities and far larger needs toupgrade its armed forces to patrol such alarge territory. What if we consider for amoment to put aside our differences andplan to expand the military and tradecollaboration by developing a jointproduction of strategic weaponry? Thisis already done in the European Union —the member economies have reducedtheir dependence on procuring importedmilitary equipment. They have leveragedon the sophisticated military industriesand made weaponry into one of theirmajor exports to the Middle East, and togovernments in South America and Asia.It is, above all, a trust-building measurebetween neighbours.

Building trust between us is an ongoingprocess. Our common position andcoordinated action on thwarting fundingand planning of terrorist activities remaincritical. There is already close cooperation



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on managing the threat of piracy alongthe vital trade routes. Singapore’scoordinated diplomacy on reducingtensions in the South China Sea is criticalin keeping ASEAN together withoutisolating China as strategic tradingpartner. Our continued collaborationbetween the armed forces of Indonesiaand Singapore foster healthy bilateralties. Are we able to take a step furthertogether by leading advancements inmilitary innovations? Could that fosterstronger diplomatic and investment tiesby forging close security cooperation andwhy not? After all, Indonesia remainsconfident that Singapore will not undothe decades of trust.

On the matter of trade andtransportation, Singapore-Indonesia tieswill be defined by competition orcollaboration in developing the airtransportation sector. We have theoption of working together or striving toexclude the other. The new focus will bedeveloping the air connectivity betweenthe vast consumer markets from Indiaand China to the Pacific economies ofAustralia, New Zealand and moreimportantly, to the economies of SouthAmerica. That connectivity is challengingand lucrative, and inevitably, Indonesiawill not give up its strategic access points.

Forging stronger ties

We cannot evade focusing and investingin people-to-people and business-to-business ties as both our countries

balance its domestic politicaltransformation. The present and futuregenerations of political and communityleaders in both countries need tounderstand our shared cultural historyand the common vision of the leaderswho laid the foundation of close bilateralties.

There is a need to expand the scholarshipprogrammes and encourage moreexchanges between public officials andyouths. There is a need to cultivate anunderstanding that as neighbours, wecan develop synergies and exist as equals.If either Indonesia or Singapore want toemerge as the dominant partner, thenthe doors for collaboration will close andthe stalemate will not bring any benefit.

For the past fifty years, the enlightenedand visionary leaders of Indonesia andSingapore have understood that assiblings in the ASEAN family, we take thenudges and occasional slurs in our strideof forging lasting ties between our leadersand peoples. We have stayed together inhard times and benefitted from theeconomic growth of our region. Manydecades on, Indonesia and Singaporehave competitive economies with citizensthat have greater expectations of whattheir country has achieved. Nevertheless,our two nations can, and must, remainfocused on working closely with ASEANand the world at large.

Our relationship is that of David, the smalland capable island of Singapore, and



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Goliath, Indonesia with its size. However,both nations are standing back to backinstead of being confrontational. Thatcould change the course of our future asneighbours — our continued mutualrespect would guide the course that wehave taken as a region.

On this occasion, I congratulate theleaders and people of Singapore for theirdetermination in transforming theeconomy and laying the foundations fora forward-looking population. Theirachievements in advancing their peopleand developing a credible and efficientsystem of administration is admirable.We have shared decades learning fromeach other and should continue to do so.I believe that Indonesia and Singaporecan forge a sustained unity in our regiondespite the diversity that exists betweenour governments and economies.


Dr Yeo Lay Hwee is Director of the EU Centre, Senior ResearchFellow at the Singapore Institute of International Affairs and AdjunctFellow at the S Rajaratnam School of International Studies. Herresearch expertise is in the area of comparative regional integration,and on ASEAN-EU and Asia-Europe relations.

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50 Years of Singapore’s Connectionswith Europe

Yeo Lay Hwee


50 Years of Singapore’s Connections with Europe

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Introduction

My personal connections withEurope began in 1995 at a

Japanese-American pub known as theCable Car. This was where I first met myDanish architect husband, Poul. I like tojoke that we are both involved inbuilding bridges — mine are imaginaryand intellectual ones to bring aboutcloser cooperation and connectionsbetween Asia and Europe, while hebuilds real bridges to bring aboutgreater connectivity.

My professional connections withEurope began in 1995, working at theInstitute of Policy Studies where I wasemployed as a Research Associate. Iwas primarily involved as the Resourceperson for the Eminent Persons Grouplooking at revitalising the Associationof South East Asian Nations (ASEAN) -European Union (EU) partnership.

Hence, I have much to celebrate in my20 years of connections with Europe.

Singapore’s connections to Europe, ofcourse, date much further back in time.Besides the fact that it was a formerBritish colony, it was also a trading huband an important port in the regionsince the 14th century. After its

‘discovery’ by Stamford Raffles in 1819,its status as a free port attracted manytraders from around Asia and Europe toSingapore with many European tradingfirms setting up merchant houses inSingapore then.

Fast forward to 1965 with Singapore’sindependence achieved unexpectedlyand with much trepidation. Being asmall state and feeling vulnerable,Singapore is keenly aware of itslimitations in material hard power andhence, invested a lot in diplomacy.Singapore has since establisheddiplomatic relations with 187 sovereignstates and participates in all majormulti lateral forums and an activemember of many internationalinstitutions.

Six European states - France, Denmark,Italy, Germany, United Kingdom andNetherlands - were amongst a dozen orso who established diplomatic ties withSingapore in 1965. Since then,Singapore has established ties with all28 member-states1 of the EuropeanUnion (EU). The Delegation of the EUset up its office in Singapore in 2002 inrecognition of the increasing ties — atthe end of 2012, the EU concluded itsfirst Free Trade Agreement (FTA) inSoutheast Asia with Singapore.

1 The 28 member states of the European Union are: Austria, Belgium, Bulgaria, Croatia, Czech Republic,Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania,Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, andthe United Kingdom (UK).



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The multi-dimensional and multi-layered ties between Singapore andEurope

Reflecting on the past 50 years ofSingapore’s development, it has beenremarkable that Singapore did notsuccumb to the post-colonial xenophobianationalism that was prevalent in the1960s, and had instead chosen aneconomic strategy which opened thedoor wide to foreign direct investments(FDI). Concerted efforts were also madeto attract multinational corporations(MNCs) and foreign corporations to setup shop in Singapore, many of them fromEurope (from Unilever to Jebsen andJessen; Shell to BP; Siemens to RollsRoyce; Philips to Electrolux). One could,of course, explain that Singapore is justtoo small and without its own hinterland,it has no choice but to be open andpursued an export-oriented strategy.

Dutch economist Albert Winsemiusplayed an important part in formulatingSingapore’s economic developmentstrategy. He was Singapore’s long termeconomic advisor from 1961 to 1984 andworked very closely with then primeminister, Lee Kuan Yew and then seconddeputy prime minister, Goh Keng Sweein ‘ industrialising’ Singapore andtransforming the City-state from anentrepôt trade port into a manufacturingcentre.

To complement the transfer of skills andtechnology, incentives were provided forforeign firms to set up training centres inthe 1960s and 1970s for Singaporeworkers —this was later extended tocooperation with developed nations toestablish technical training centres suchas the German-Singapore Institute ofProduction Technology and the French-Singapore Institute for Electro-technology.2

From these snapshots, one could say thatSingapore’s connections with Europehave been strong and the governments,companies and peoples of Europe havecontributed in different ways to thedevelopment and transformation ofSingapore.

However, what about Singapore’scontributions to the EU and Europe?

Singapore has often been said to ‘punchabove its weight’ in foreign policy andinternational relations. Its first-generation diplomats, many of them‘accidental’ such as Professor TommyKoh, have played an important role in the‘ internationalisation’ of Singapore.Tommy Koh, the consummate diplomatand negotiator, in particular, has beenassociated with various UN-initiatives,being the President of the Third UnitedNations (UN) Conference on the Law ofthe Sea (1980 to 1982) which resulted in

2 Gundy Cahyadi, et al., “Singapore’s Economic Transformation”, Global Urban Development’s SingaporeMetropolitan Economic Strategy Report, June 2004.



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the United Nations Convention on theLaw of the Sea (UNCLOS) III agreement.He also chaired the UN Conference onEnvironment and Development, alsoknown as the Rio Summit in 1992. The10-day meeting resulted in severalimportant political declarations andlegally binding agreements. However,lesser known perhaps but no lessimportant, is his appointment as specialUN Envoy to the Baltic States in 1993.

The mission to the Baltics concernedthe demand of Estonia, Latvia andLithuania for the full withdrawal ofRussian troops from their territories.These three Baltic States had theirindependence restored in 1991following the dissolution of the Sovietempire. Russia signed an agreement torecognise their independence thatsame year. However, Russian troopsremained in their territories as Russiastruggled to manage the return of theRed Army from various former Sovietrepublics which had becomeindependent then. The successfulmission by Tommy Koh resulted in thephased withdrawal of the troops —assistance was also provided byDenmark, Norway and the UnitedStates (US) to help build housings forthe returning troops and their familiesin Russia.3

The Baltic States have since made

extraordinary improvements in theirsocioeconomic conditions. Theybecame members of the North AtlanticTreaty Organisation (NATO) and of theEU in 2004, and all three countries havealso adopted the euro as their Europeancurrency.

Singapore has also tried to serve as theinterlocutor between the East and theWest. It has contributed to the early1990s debate on Asian values — therationale for stirring up this debate wasto respond to the triumphalism of theWest in the early years at the end of theCold War whilst preventing the beginningof another cold war between anemerging China and a triumphantAmerica.4

In responding to the opening up of Chinaand the increasing importance of EastAsia to the global economy, Singapore,way back in 1994, saw the need forgreater engagement between East Asiaand Europe. The idea presented wassimple — The narrative was that Europe,East Asia and North America as the threeengines of global growth, needed tounderstand each other further and towork closer. While transatlantic tiesbetween Europe and America are strongdue to historical and institutional reasons,and transpacific ties between East Asiaand North America have been bolsteredwith the launch of the Asia Pacific

3 See “The Tommy Koh Reader: Favourite Essays and Lectures”, pp 61-68.4 See Bilahari Kausikan’s “The Idea of Asia in Straits Times”, 8 November 2014.



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Economic Cooperation (APEC),institutional ties between East Asia andEurope were relatively weak. Tostrengthen this third link, Singaporeunder then Prime Minister Goh ChokTong went to Europe to canvass supportfor a leaders’ summit between East Asianand European leaders. The Asia-EuropeMeeting (ASEM) comprising ASEAN,which included China, Japan and SouthKorea on the Asian side; the other 15 EUmember states and the Commission onthe European side, was launched in 1996.

ASEM was a symbol of Asia’s and Europe’srediscovery of each other, and anaspiration for stronger ties. Since then,the interdependence between Asia andEurope has deepened and ASEM hasenlarged to 53 partners. Singaporecontinues to also advocate a pragmaticapproach towards our bi-regional ties.

The initiative by Singapore to set up anAsia-Europe Foundation (ASEF) tocomplement the ASEM process is a signof strong commitment from Singaporeto help strengthen the ties betweenAsia and Europe at the people-to-people level. ASEF, founded in 1997 andlocated in Singapore, is now the only‘brick and mortar’ institution of ASEMdevoted to what the President of theEuropean Council, Herman Van Rompuycalled “the cross fertilisation of ideas”.Van Rompuy added that he had only

praises of the vision of Goh Chok Tongto bring about closer Asia-Europe tiesthat led to the launch of ASEM and ASEFtwo decades ago.5

The founding Executive Director of ASEFwas Tommy Koh, and together with histeam in ASEF initiated a number ofprojects that brought togetheracademicians and researchers, artists,editors and journalists, teachers andstudents, and youths from Asia andEurope. As ASEF approaches its 20thanniversary in 2017, it can look back withsatisfaction that it has succeeded inbuilding many new bridges ofunderstanding and friendship betweenAsia and Europe.

In contributing to the broader Asia-Europe relations, the EU and Singaporeties have also grown in importance. TheEU opened its Delegation office in 2002,and Singapore is the first Southeast Asiancountry to conclude a Free TradeAgreement (FTA) with the latter. The EU-Singapore FTA is the most comprehensiveagreement that the EU has evernegotiated with a third country and willserve as a benchmark for other countrieswithin the region as well as becoming astepping-stone eventually for an EU-ASEAN FTA.

In many ways, Singapore served as anentry point and a gateway for many

5 Speech by Herman Van Rompuy, President of the European Council at the Schuman Lecture organised bythe European Chamber of Commerce in Singapore.



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European companies into ASEAN.Singapore is host to over 10,000European companies — close to 90,000Europeans live and work in Singapore.Singapore’s active role in ASEAN in thelast two decades has also indirectlyhelped the EU to realise the strategicimportance of ASEAN in the broaderAsia-Pacific region. Though the EU andASEAN had established formalpartnership since 1977, it was only inrecent years that the EU has begunto place more emphasis on itsengagement with ASEAN.

However, it is not only in trade that theEU and Singapore are natural partners— Singapore has, in the last twodecades, with the setup of theSingapore Cooperation Programme(SCP), actively sought to work withdevelopment agencies, banks andother developed countries in Europe tooffer various training courses — thesecan help build capacity and promotehuman resource development in thenewer ASEAN member states such asCambodia, Laos, Myanmar andVietnam. For instance, Singapore is thefirst Southeast Asian country to workwith the European Commission on atechnical assistance programme fordeveloping countries. The programme,which started in 2004, coveredtechnical assistance in particular toCambodia, Laos and Vietnam.

The opening of an EU Centre inSingapore, the only such Centre in

Southeast Asia is another EUrecognition of Singapore’s importanthub status in the region. In the call forproposal to set up an EU Centre inSingapore, the Commission noted that“EU’s relations with Singapore areunderpinned by very strong commercialties” and that “Singapore acts as the hubfor European business in the Asia-Pacificregion”. Furthermore, Singapore is alsoseen as an important education hub inSoutheast Asia, and the Centre wouldtherefore be “particularly well located topromote the policies and awareness ofthe EU”.

Singapore enjoys excellent bilateral tiesnot only with the UK because of historicalreasons, but with many other EUmember states including France,Germany, Ireland, Netherlands, Sweden,to name a few. These ties are not onlypolitical and commercial but also ineducation exchanges, scientific andresearch collaboration, and so on.

Despite the big presence of Europeancompanies and Europeans in Singapore,there is certainly still a lack of awarenesswith regards to the functioning of the EU.The strong bilateral ties that Singaporeenjoys with several EU member statessometimes obscure the importance ofthe EU. However, as Singapore beginsto play an active role in ASEAN topromote closer regional cooperation,the EU is increasingly seen as areference point for ASEAN as the latterseeks to achieve its goal of building an



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ASEAN Community by 2015.

The EU is one of the most integratedeconomic bloc with a single market ofover 500 million consumers and citizensenjoying the four freedoms (freemovement of goods, services, capital andpeople). The EU’s complex institutionalstructure and decision-making process,which is what makes the EU democraticand resilient, is also often associatedwith its inflexibility and inability torespond quickly to external events.Despite the current debt problems inthe Eurozone, the anaemic growthfigures and high unemployment, onemust not forget that the EU hasdelivered on peace and reconciliation,and has contributed to the economicreconstruction as well as increasingliving standards of many Europeancitizens for several decades.

While Singaporeans learn more aboutthe multi-level governance andcomplex institutional structures in theEU, Europeans living in Singapore wouldhopefully come to appreciate theSingapore paradox — the rich but alsorigid diversities and the economicallyaffluent but at times seen as ‘politicallyimpoverished’ City-state.

Many Europeans look upon their stayin Singapore as a ‘training ground’ fortheir ‘real entry’ into other parts ofAsia. Singapore is in Asia and very muchpart of Asia, and its primarily Asianpopulation comprises people of

Chinese, Indian and Malay background.Therefore, Singapore is supposed toprovide a flavour of what ‘Asia’ is toEuropeans, but not too much as toknock them out of their comfort zone.Its ‘traditional Asianness’ is cushionedby its familiar ‘Western modernity’where everything functions likeclockwork.

In some way, Singapore, thiswesternised Asian City-state is somesort of a paradox that hopefully helpsto challenge the ‘either-or ’ binarymindset, as well as the teleologicalbelief in linear progression. We can beeconomically free but not so politicallyfree as we have a rule of law and goodgovernance, but not necessarily multi-party liberal democracy as understoodby the West. For Europeans who liveand work in Singapore, they too mustalso be amused by the paradoxical ‘cando’ spirit of the country as a whole butthe ‘cannot do unless explicitly told todo so’ mentality of many Singaporeans.

Living in Singapore could therefore leadEuropeans to question many of theassumptions they have on culture,tradition, development and modernity.

Conclusion

Singapore’s connections with Europe gomuch further back beyond 50 years.This was, of course, very much colouredby its colonial ties with the UK.However, since its independence in



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1965, Singapore has built up a wealthof connections and relations withEurope far beyond the UK. Through itsdiplomacy, its active engagement inglobal and regional affairs, Singaporehas much to share with the Europeancountries. Through its involvement inASEAN, it has also strengthened tieswith the EU and its member states.Hence, through its openness inwelcoming companies, corporations andtalents to its shore, it provides a richenvironment for mutual learning andgrowth between Singaporeans andEuropeans.


Professor Tan Tai Yong is a historian and currently, the ExecutiveVice President (Academic Affairs) of Yale-NUS College. ProfessorTan is concurrently Director of the Institute of South Asian Studies(ISAS), a NUS-based research institute. He is also a NominatedMember of Parliament (NMP).

Soh Yi Da is currently a Manager at Singapore TelecommunicationsLimited (Singtel). Yi Da read Political Science and graduated with aBachelor of Social Sciences (Honours) from the National Universityof Singapore and at present, serves as a Fellow of the Ridge ViewResidential College, member of the Alumni Student AdvancementCommittee and President of the ASEM Young Leaders Network.

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Singapore and Southeast Asia:A Shared History and a Shared Destiny

Tan Tai Yong and Soh Yi Da


Singapore and Southeast Asia: A Shared History and a Shared Destiny

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Introduction

Singapore started life as anindependent state with an

ambivalent attitude on its place in theSoutheast Asian neighbourhood. Theacrimony that had led to separationfrom Malaysia and the accompanyingIndonesian Confrontation meantthat Singapore’s relations with itsimmediate neighbouring states wasfraught with distrust and tensions. Borninto a region that was facing a volatilemix of Cold War tensions, politicalinstability and violent insurgencies, thenew city-state of Singapore knew thatconditions were far from propitious andits future uncertain. Yet, there was nodenying geography. Recognising that itis ‘ inescapably and forever part ofSoutheast Asia’, Singapore knew that itsfuture was very much tied to the fate ofthe region. With regional stability andnational security foremost in its mind,Singapore became a founding member ofthe Association of Southeast Asian States(ASEAN), formed in 1967 as a regionalgrouping of non-communists states heldtogether by shared security concernsposed by the looming threat ofcommunism in Southeast Asia.

The ASEAN regional grouping providedsafety in numbers, but it could notreplace the market or economic basethat Singapore had lost when it wasexcised from its Malaysian hinterland.In its early years, ASEAN did not providethe economic hinterland that Singapore

needed so badly for its economicdevelopment. It was, therefore, amatter of its survival strategy thatSingapore took the approach that whilethe fate of the small city-state wasfundamentally rooted in SoutheastAsia, its well-being could not be solelydetermined by the region. This ledSingapore articulating its ambitions asa global city in 1971, driven by ‘the keystrategic imperative … to create political,economic and economic space …beyond the immediate region andmaintain a lifeline to the world at large’.S Rajaratnam, the then Foreign Minister,envisaged that Singapore would graduallybe transformed from a regional tradinghub and marketplace to become anintegral part of the global economicsystem.

Singapore’s responses to the challengesthat it faced in the early years of itsexistence as a nation-state have workedwell, and the policies arising from thoseresponses have served Singapore’sinterests effectively. Yet, even asSingapore finds success as a global city,there is no denying that its fate hasalways been inextricably intertwinedwith the developments andtransformations in the region. Fiftyyears after independence, Singaporehas since become an establishedmember of the ASEAN community andis now in a much happier place thanwhere it had found itself back in 1965.How will this history now influence itsfuture?



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Shared history: From regional empiresto ASEAN

Singapore is a 50-year-old nation-state.However, this present status ofindependence as a sovereign state is ananomaly in the island’s long history.Singapore had always been part of alarger polity or geopolitical entity in theregion. Since the 14th century, Singaporehad functioned as an emporium servingan intricate trading network linking thePersian Gulf, the Straits of Melaka and theSouth China Seas. It has been pointed outthat Singapore was ‘not so much anexport port for its [Malay] hinterland, butmore an emporium for East-West tradeand a port linking the archipelago to theworld markets in China, South and WestAsia as well as Europe. Singapore hadeither served as a vassal state or hadbeen subjected to the control of theSrivijaya and Majapahit empires, theMalacca Sultanate, Johor Sultanate andother competing powers in the region.

From 1819, Singapore became part of theBritish Asian Empire that stretched fromthe Arabian Peninsula to Kalimantan, andmore specifically, an integral part of theStraits Settlement together withPenang and Malacca. British rule wasinterrupted by nearly four years ofJapanese Occupation, during whichSingapore was Syonan-To (meaning‘Light of the South Island’) of theJapanese Empire in East Asia. After theJapanese Occupation, Singapore and theregion was swept by a wave of postwar

nationalism and decolonisation whereformer colonies gained self-governanceand independence. Together withMalaya, Sabah and Sarawak, Singaporewas part of the larger MalaysianFederation from 1963 to 1965. Thus,when it achieved sovereign statehoodafter leaving Malaysia, Singapore alreadyhad a long lineage of associations withkingdoms, sultanates and empires in theregion.

The shared regional history was alsoengendered by the communities thatcame to populate Singapore in the 19th

and early 20th centuries. As a trading hub,Singapore attracted immigrants whomoved to the island in search ofeconomic opportunities and livelihood. Aplural, energetic migrant community layat the heart of Singapore’s early successas a cosmopolitan emporium and thrivingport-city. Linked by people, the port-cityserved as that critical node in a complextrading and social network thatconnected communities from SoutheastAsia, China, India, and the Middle East.

The shared heritage notwithstanding,Singapore’s unexpected birth as asovereign independent nation in 1965came at a time when the surroundingSoutheast Asian region was mired insuspicion, distrust and conflicts againstthe backdrop of the decolonisation andthe Cold War. Its two immediateneighbours, Malaysia and Indonesia,were embroiled in the Konfrontasi, whileIndochina was the battlefield for the



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longstanding power struggles betweenthe Cold War rivals and their proxies.Singapore’s relationship with its regionalneighbours did not get off to an easy andhappy start. Despite a rocky beginning,the first generation of statesmen fromSingapore, Malaysia, Indonesia,Philippines and Thailand had the foresightto sign the Bangkok Declaration thatinaugurated the formation of theAssociation of Southeast Asian Nations(ASEAN) on 8 August 1967. The BangkokDeclaration was intended to overcomethe inherent diversities and differencesthat was characteristic of the region atthat time, and to provide some structuralorder for interstate relations.

The success of ASEAN lies in the factthat it was able to cement the crucialfoundations that would facilitate regionalcooperation, paving the way for regionalpeace, stability and economicdevelopment. Inaugurated in anenvironment that was marked by a highdegree of trust deficit, the formation ofASEAN as a regional organisation, as wellas the ‘ASEAN Way’ of decision-makingcharacterised by consensus and non-interference, provided Singapore and itsregional partners the opportunity tofocus on the consolidation of domesticorder and the construction of productivemultilateral ties. Since 1967, ASEANhad successfully facilitated economiccooperation and resolution of regionalissues through diplomacy andnegotiations. While ASEAN was neverintended as a security-military alliance,

the regional grouping was able tomaintain regional balance and stability,following the withdrawal of theAmericans from Southeast Asia in thewake of the fall of the Indo-Chinese statesto the communists.

Starting out as a Cold War contingency,ASEAN has come to its own in the past50 years. It has held together throughoutsome major international crises,weathering the instability in Indo-China;debilitating financial crisis of 1987; andthe fall of long-standing strong menregimes in the Philippines and Indonesia.By the mid-1980s, differences ineconomic approaches notwithstanding,ASEAN had established itself as a dynamicregional grouping whose credibilitywas further strengthened when itsmembership extended beyond theoriginal five Southeast Asian countries(Indonesia, Singapore, Malaysia, thePhilippines and Thailand) to eventuallyinclude the other five (Brunei, Laos,V ietnam, Cambodia and Myanmar).Through ASEAN, the Southeast Asianregion experienced an extended periodof peace, stability and economic growth,in spite of the occasional hiccups ininterstate relations.

Forty years after its inception, ASEANmember states finally adopted the ASEANCharter in 2007 at the 13th ASEAN Summitin Singapore, providing a firm foundationfor achieving an ASEAN Community byproviding legal status and institutionalframework for ASEAN, as well as codifying



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the ASEAN norms, rules and values.Progress in these areas will be critical asit has been pointed out that while ASEANhas been reasonably successful as aregional grouping so far, it can never‘entirely erase the primordial diversitiesof the region because race, language andreligion are the essence of core identities’.Despite the realists’ concerns, thepromulgation of the ASEAN EconomicCommunity 2015 Blueprint at the sameASEAN Summit, together with the ASEANPolitical & Security Community andASEAN Socio-Cultural Community 2015Blueprint at the 2009 Summit are indeedencouraging testimonies of how far theregion has progressed collectively. It isperhaps apt that in the year thatSingapore celebrates its 50th birthday asan independent country, the ASEANCommunity will be inaugurated.

Bilateral Warmth

Regional stability and engagements werealso built on strong bilateral relationswithin the region, in spite of theoccasional spats between neighbours.There have been the occasionalsquabbles over water supply withMalaysia, and former IndonesianPresident B J Habibie had dismissivelycalled Singapore ‘a little red dot’. Yet,these terse exchanges and diplomatichiccups did not boil over into overtconflict — bilateral ties with ourneighbours have remained strong,underscored by the multitude of bilateralmilitary exercises, high-level political

exchanges and deep trade and businessnetworks.

Fifty years from its acrimonious break-up,Singapore’s relations with Malaysia hasmatured into a stable one. Veterandiplomat, Professor Tommy Koh, hascommented that the ‘overall relationshipbetween Singapore and Malaysia is good,with Malaysia amongst Singapore’slargest trading partners and Singaporeamong Malaysia’s largest foreigninvestors’. Singapore is also Malaysia’slargest source of tourists. Both sides havealso ‘resolved standing dispute over theMalaysian Railway land, therebyunlocking the door to new areas ofcooperation, such as a rail link betweenSingapore and Johor Bahru’.

The example of the amicable resolutionof the territorial dispute of Pedra Brancabetween Malaysia and Singapore, byreferring it to the International Court ofJustice’s arbitration and accepting itseventual outcome, demonstrated bothSingapore’s and Malaysia’s wisdom inresolving bilateral differences.

Despite historical grievances and theoccasional disagreements over issuessuch as the extradition treaty and thetransboundary haze, relations betweenSingapore and Indonesia have beenbuttressed by strong economic ties. Thetwo states have also supported eachother in times of crises. The IndonesianNational Armed Forces came swiftly toSingapore’s aid with search and recovery



External Relations

operations when a Singapore carriertragically crashed into the Musi River nearPalembang. In the aftermath of the 2004Indian Ocean tsunami, the SingaporeArmed Forces mounted a majoroperation, involving numerous militaryassets and over 1,500 personnel to assistin the disaster relief operations.

Singapore’s bilateral relations with ourregional neighbours, especially ourimmediate ones such as Malaysia andIndonesia, have indeed progressedsignificantly in the past fifty years. Thishas been the result of institutional-building at ASEAN-level as well as theiterative goodwill and relationship-building across government-to-government, military-to-military andpeople-to-people levels over severaldecades.

Meeting future challenges

Over the past five decades, the regionhas had its fair share of tough times,rough patches as well as significantachievement milestones as a region. Thefuture may pose more challenges thatwill test regional resolve. To face theemerging threats of terrorism, maritimesecurity, climate change and pollution,among others, countries no longer havethe option of acting alone as many ofthese issues now transcend territorialboundaries. In many ways, ASEAN hasnever been more important to Singapore,and it is incumbent on Singapore toenhance its already strong links in the

region. We suggest that this can be donein a number of ways. In line with realisingthe region’s vision of an ASEAN EconomicCommunity in 2015, Singapore could helpto strengthen the hardware bycontributing to the enhancement ofregional infrastructure and connectivity.

Apart from investments supporting theseinfrastructural projects, Singapore canalso take on an active stewardship rolein spearheading more multilateralagreements to liberalise air, land, sea andtelecommunications links. The successfulcompletion of initiatives such as theSingapore-Kunming Rail Link and theestablishment of the ASEAN BroadbandCorridor would go a long way in boostingintra-regional connectivity forging acloser and more inclusive ASEAN.Furthermore, Singapore should maintainits firm commitment to support initiativesrelated to regional cooperation andregional economic integration. A goodexample would be Singapore’s hostingand stewardship in setting up theASEAN+3 Macroeconomic ResearchOffice — an independent regionalsurveillance unit to monitor and analyseregional economies and support theChiang Mai Initiative Multilateralisation(CMIM) decision-making.

In order to ensure that these strongties continue to last for many moregenerations to come, there is a need tocreate more in-depth People-to-People(P2P) exchanges between our youngSingaporeans and the youths from our



External Relations

region. This can be done betweeneducation institutions and civicorganisations across a broad range ofissues from research to environmentalprotection. Schools and institutions ofhigher learning should develop programsthat will deepen students’ understandingof the region. By creating newopportunities of engagement, we willopen more possibilities for deepercollaboration and paving the way toachieve more for our collective good. Theties forged through these avenues andforums would be the intricate threadsthat bind the fabric of our region. In manyways, these would not be dissimilar to theinformal trade and social networks thatonce bound the region before the adventof states and boundaries.

Conclusion

By most definitions, Singapore can nowbe regarded as a global city, and there areclear indicators that Rajaratnam’s 1971vision has largely been realised.Singapore is a First World, cosmopolitancity-state whose economy is deeplyintegrated into a global system. Itseconomic hinterland is no longerrestricted to its immediate neighborhood— to all intents and purposes, the worldis now Singapore’s hinterland. However,even as Singapore establishes itself as asuccessful member of the internationalcommunity that is widely admired to beable to punch above its weight, it has toremind itself of another reality — thecountry’s fate will always be tied to the

region’s wellbeing. Being a small city-state in Southeast Asia, with all itsinherent differences and diversity.

Singapore will need to ensure that it willalways be welcomed as an integral partof a region that needs to work at stayingintact. The old kampong spirit of gotongroyong (mutual cooperation for thecollective good) would serve as a usefulguiding principle on how Singaporeshould engage the regional neighbours inthe Southeast Asia kampong. Anchoredon the basis of goodwill and trust, thisentails adopting a win-win mindset inapproaching regional collaboration,knowing that a rising tide raises all boats.Singapore can play a major role asadvocate and connector for the region.It could use its established position as ahub for communications, logistics, tradeand investments to good effect.

As an advocate, Singapore ought tochampion the articulation of regionalidentity on local, regional and globalplatforms. Serving as a connector,Singapore should enhance connectivitylinks and create new avenues to facilitatecross-cultural interaction so as tostrengthen regional cohesion.Singapore’s history cannot be delinkedfrom the history of the region, and itsdestiny is undoubtedly intertwined withthe fate and fortunes of Southeast Asia.A peaceful and prosperous SoutheastAsia will be the crucial platform that willensure the continued success ofSingapore in the next fifty years.

commentary 2011

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Transcript of commentary 2011