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SINGAPORE Path to Development

SINGAPORE Path to Development. Prof. Stephen Lawrence Leeds School of Business University of Colorado. Singapore Skyline. Southeast Asia. Malaysian Peninsula. http://www.fsas.upm.edu.my/~masdec/web/straits.html. Singapore Island. Singapore Today. Population – 4.5 million

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SINGAPORE Path to Development

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  1. SINGAPOREPath to Development Prof. Stephen LawrenceLeeds School of BusinessUniversity of Colorado

  2. Singapore Skyline

  3. Southeast Asia

  4. Malaysian Peninsula http://www.fsas.upm.edu.my/~masdec/web/straits.html

  5. Singapore Island

  6. Singapore Today • Population – 4.5 million • Fertility rate of 1.07 children (3rd lowest in world) • Gov’t planning growth to 6.5 million by 2020 • Size – 270 sq. miles (704 km2) • World’s second most dense country • Ethnic background of population • Chinese (75%), Malay (14%), Indians (9%) • Official languages • English, Mandarin, Malay, Tamil

  7. Downtown & Singapore River

  8. Singapore River at Sunset

  9. Early History • Second Century AD – First evidence of human settlement • Became an important trading post • Sumatran Srivijaya empire 1000-1400 • Called “Temasek” • Declined after 1400 • Sacked in 1613 by Portuguese • Reverted to a fishing village with few inhabitants until 1819

  10. History from 1819 • 1819 – Britain established a trading post on Singapore Island • Sir Thomas Raffles, East India Company • Free port (no tariffs) – largely entrepôt port • Spices, rubber, palm oil; goods from China, Indonesia, Malaya • Quickly become an important trading port in SE Asia • Principal British presence in SE Asia

  11. Sir Thomas Raffles

  12. Raffles Plan for Singapore (1822)

  13. Singapore Riverfront (c. 1890)

  14. Boat Quay 1929 and Today

  15. World War II • British believed in “Fortress Singapore” • Japanese invaded Malaysia on 8-Dec-41 • Leap-frogged down Malay Penisula • Light tanks and bicycle infantry • Singapore surrendered on 14-Feb-42 • Harsh 3½ year Japanese occupation • 5-25,000 Chinese Singaporean’s executed • Japanese surrendered on 15-Aug-45 • British returned to Singapore on 9-Sep-45

  16. Fall of Singapore & Surrender

  17. Post-WWII Events • 1955 – Partial internal self-government • Increasing social unrest, anti-colonial feelings • Hock Lee bus works strike and riots (1955) • Chinese Middle School riots (1956) • 1959 – Full internal self-government • People’s Action Party (PAP) sweeps elections to Legislative Assembly (41 of 53 seats) • Lee Kwan Yew becomes Prime Minister

  18. PAP Initiatives (early 1960’s) • Trade unions consolidated into one • National Trades Union Congress (NTUC) • Strong government oversight • Education system revamped • Create a skilled workforce • English chosen as language of instruction • High-rise low-cost housing blocks • 25,000 apartments in first 2 years

  19. Singapore Housing Blocks

  20. Singapore Economics

  21. Per Capita GNP Growth http://www.pacificbridge.com/publication.asp?id=8

  22. GDP per Capita (2005) Singapore is 23rd ($26,836) World GDP 2005 – Top 20 Nations http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)_per_capita

  23. Ranking Singapore http://www.sedb.com/edb/sg/en_uk/index/why_singapore/singapore_rankings.html

  24. Economic Strategy 1819-1950’s • Regional entrepôt • Natural, deep harbor, • Strategic location between SE Asia and Europe • Free-port policy • Imported European manufactures to region • Exported regional commodities to Europe • Ancillary storage and warehousing, shipping, and banking services.

  25. Economic Strategy 1960-80’s • 1960’s – Focus on low-cost manufacturing • 1970’s – Focus on labor skills & technology • Machine tools, petrochemicals, electronics, and precision work • 1980’s – Capital intensive high tech • Computers & peripherals; electronic medical instruments; automotive components; specialty chemicals & pharmaceuticals; optical & photocopying equipment http://www.nationsencyclopedia.com/Asia-and-Oceania/Singapore-ECONOMIC-DEVELOPMENT.html

  26. Economic Strategy 1990’s • Manufacturing and Services • Transformation from a production-driven to innovation-driven economy • Focus on education and human resources • Film, media, and publishing, arts and entertainment, textile, fashion and design sectors • Outsourcing of manufacturing to low-wage sites in Indonesia and Malaysia http://www.nationsencyclopedia.com/Asia-and-Oceania/Singapore-ECONOMIC-DEVELOPMENT.html

  27. Economic Strategy 2007 • Global Hub for business and finance, logistics & distribution, communications and information • Key economic activities increasingly concentrated in a few strategic centers • Hub services extended “hinterland” • Heavily investing in humans & infrastructure • Education, training, and industrial relations • Airport, seaport, telecommunications network, biotech, financial and industrial facilities • Regional investment • Malaysia, Indonesia, China, India, Vietnam

  28. Maritime Shipping • Port of Singapore is busiest in world • 24 million TEU’s in 2006 • PSA owns 26 ports in 15 countries http://www.internationalpsa.com/factsheet/map.html

  29. Global Shipping Routes http://www.mts.gov.eg/comesa/English/maps/some_major_world_shipping_l.jpg

  30. Largest Container Ports 2005 http://en.wikipedia.org/wiki/List_of_world's_busiest_container_ports

  31. Port of Singapore Today (2007)

  32. Air Shipping & Passenger Hub • Singapore Changi Airport • Two terminals, third under construction • SE Asian hub for passenger & cargo (2006) • 35 million passengers • 1.9 million tonnes of cargo • 25 “best airport” awards (2006)

  33. Singapore Exchange • Formed 1999 • Merger between the Stock Exchange of Singapore & Singapore International Monetary Exchange • 72% securities, 28% derivatives • Strategy to be Asian gateway exchange • Agreements signed with India & Abu Dhabi • Agreements with London & Tokyo in works

  34. Singapore Biopolis • Campus for biomedical sciences • Constructed 2003 to 2006 (two phases) • Site for biomedicalscience, research,entrepreneurship • 45+ companiesin residences

  35. Caltex (energy) Flextronics (manufacturing) SingTel (phone company) Singapore Airlines Neptune Orient (shipping) Keppel Corp (various) DBS (development bank) Fraser & Neave (food) Singapore Technologies Engineering (defense) NatSteel (metals) WBL Corp (various) Singapore Press (media) APRIL (wood & paper) Asia Mobile (telecom) Creative Tech (equipment) Far East Group (real estate) JBS Singapore (energy) Kalama Services (energy) Top Singapore Companies http://www.transnationale.org/countries/sgps.php

  36. Temasek Holdings (2007) • State-owned investment company • Portfolio = $100 billion • Revenues = $50 million • Invests in 100’s of companies • SingTel, DBS Bank, Singapore Airlines, PSA International, SMRT Corporation, Singapore Power, Neptune Orient Lines • 75% in Singapore companies • Goal to reduce to 25% in time • 18% annual return over 33 yrs of business http://www.temasekholdings.com.sg/

  37. Singapore Education 2006 • ~20% of national budget devoted to education • Literacy = 95.4% • Annual budget = S$7.0 billion = $4.3 billion • Total students = 532,225 • Budget/student/year = $8,142/student • Students wear school uniforms

  38. Singapore Education • Principles • Meritocracy • Bilingualism (English + mother tongue) • Financial assistance • Higher Education • 16 junior colleges • 5 polytechnics • 10 institutes of technical education • 4 universities • 10 specialized tertiary schools (e.g., business schools)

  39. International Education Scores

  40. Government • PAP dominant party for 40+ yrs • PM Lee Kwan Yew 1963-1990 • Leadership based on Confucian principles • Paternal authority; duty to take of people; leadership by moral example • “Soft” authoritarianism & incorruptible leaders • Dissent and opposition stifled • Democracy, but not in US/European sense • “The city that works” Haas (ed), “The Singapore Puzzle,” Praeger, 1999

  41. Why Singapore has Worked • Strong, incorruptible leadership • Government-directed & involved economic development and strategy • Leverage natural advantages • Focus on education & human capital • Move up the food chain with prosperity • Steadily increasing standards of living • Citizens patient with government

  42. Questions?

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