SINGAPORE’S ‘4G’ BALANCING ACT
As expected, the ruling People’s Action Party (PAP) won the Singapore general election, which was held on July 10 amid Covid19 restrictions and the worst economic crisis in decades. Singapore’s GDP plunged by 42.1% in the three months to the end of June, the biggest quarterly drop on record.
Usually the incumbent party does well in a crisis and the PAP expected to do the same this time, especially after the administration doled out a S$93 billion (US$66.9 billion) worth of measures to fight the pandemic. However, the opposition made unprecedented gains, seeing its presence double to 10 elected members of parliament, while the PAP had its third-worst vote share on record.
The poorer-than-expected result for the government has been interpreted as voter disaffection with the handling of Covid-19 and with the leadership in waiting, which has been dubbed the fourth generation (4G), as Prime Minister Lee Hsien Loong plans for a transition. Voters sent a clear message asking for more checks and balances in government.
One of the key issues the government may need to rethink is Singapore’s economic model which is heavily dependent on global trade. It also needs to manage the relationships with China and the US amid growing tensions.
China is working hard to strengthen its relationship with Asean countries and Singapore is of particular importance given its advanced economy, technology leadership, strategic position as a shipping hub and role as a financial centre.
Up until now the city-state has attempted to maintain a careful balance between the rival superpowers, leaning toward the US for security purposes and China for commercial relations. Singapore has been China’s largest foreign investor since 2013.
With tensions ramping up, maintaining this position on the tightrope is becoming increasingly difficult. An example of this is the development of Singapore’s 5G communications network. For security reasons, the US is pressuring allies not to work with Huawei. But the Chinese company is a global leader in 5G development and strongly supported by the Chinese government.
Singapore neatly resolved this problem by choosing the European companies Ericsson and Nokia to provide the infrastructure for its 5G development but leaving the door open for Huawei to operate smaller 5G networks in the country.
But 4G is the biggest political challenge. The fourth generation of leadership has been carefully cultivated in recent years, with Heng Swee Keat, the current deputy prime minister and finance minister, positioned to become prime minister when Mr Lee steps aside in the next year or two.
It was supposed to be a smooth transition, with many of the 4G leaders fronting the government response to the Covid-19 crisis. However, their poor performance in the polls could indicate a lack of confidence in their leadership. For example, Mr Heng’s team was one of the worst performers in multi-member constituencies won by the PAP, achieving a vote share of 53.4%, down from 60.7% in 2015.
With a bleak economic outlook and more job losses on the horizon, questions have also been raised about the sustainability of a growth model dependent on the labour of low-wage foreign workers. These factors might be behind the opposition Workers’ Party winning 10 seats. While the ruling party still has an 83-seat majority, this is still the most seats won by an opposition party since independence.
Clearly the new generation of politicians will have to oversee a careful balancing act, and meet the changing demands of a new generation of voters.