Will Singapore remain rich?
Singapore has been called one of the Four Asian Tigers or Dragons, along with Hong Kong, South Korea and Taiwan. Recently, Singapore overtook the US and Hong Kong to reclaim its ranking as the world's most competitive economy.
The ranking, by Swiss business school IMD, evaluates the extent to which a country fosters an environment where enterprises can achieve sustainable growth, generate jobs and increase the welfare of its citizens.
Singapore's rise to the top was attributed to its advanced technological infrastructure, availability of skilled labor, favorable immigration laws, and the efficient way in which new businesses can be set up here.
How can a little country in Southeast Asia achieve such a feat? The following is a list of reasons for Singapore's success from the eyes of a foreigner who lived here for more than two years. Geography and neighborhood Singapore is strategically located in the middle of Southeast Asia as a trading and logistics hub. For example, if oil is exported to East Asian countries such as Japan and South Korea, container ships from the Middle East must go through the Malacca Strait for the shortest distance.
Moreover, they cannot make the whole journey without refueling. Therefore, Singapore is naturally well positioned to be a trade hub for container ships. Stable political environment and policies
The People's Action Party is a major center-right political party in Singapore. Founded in 1954 as a pro-independence party descended from an earlier student organization, it has gone on to dominate the political system.
One of the founding members of the party, Lee Kuan Yew, served as the first prime minister of Singapore, governing for three decades. Lee is recognized as the nation's founding father, with the country described as transitioning from a "Third World country to the First World country in a single generation" under his leadership.
Lee maintained very strict oneparty rule through various institutions, such as gerrymandering, which in turn gave him enough power to realize his grand vision for a small city-state.
This stable one-party-rule political system has provided a fertile foundation for economic growth. Combined with the charisma and leadership of a visionary leader, Singapore was able to develop and outshine many other developing countries.
The Master Plan (MP) is the statutory land-use plan that guides Singapore's development in the medium term, over 10 to 15 years. It is reviewed every five years and translates the government's broad longterm strategies into detailed plans to guide the development of land and property. While providing stability, the Master Plan is flexible enough to allow amendments as circumstantial needs arise from time to time.
South Korea offers a counterexample, where a change in government can completely overturn policies implemented under the previous regime. For instance, the dismantling of nuclear power plants in a matter of years after President Moon-Jae-in came to power, thus destroying an entire industry that had grown over past decades, simply shows how important it is to have policy stability when it comes to long-term planning.
The status of Singapore as a stable place to run business is also in stark contrast to Hong Kong, which is another city-state with a reputation as being businessfriendly and has attracted many investments in the past. Recent political instability in Hong Kong shows how political risk can negatively affect business sentiment.
Efficient and competent public sector Many bright Singaporean youth go overseas to study under government scholarships. In return, they are obliged to return to Singapore and work in the public sector for several years.
Moreover, Singapore has a long-standing high-wage policy for civil servants.
The government reviews and amends salaries regularly to ensure they are competitive. Civil servants also receive bonuses linked to the country's economic performance.