HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

Lecture 8 Economy-building as Nation-building in Singapore A. Module Pitstop a. R !A"# $e%initions i. &b'e(ti)e $e%initions ii. Sub'e(ti)e $e%initions iii. Aspe(ts o% Nation-building

b. Appli(ation to Singapore*s !ase

(. +e, -uestions %or 2nd .al% o% module / Nation-building in Singapore post 1909 # i. 1.at .as been t.e .istor, o% ea(. nation-building poli(,2 1. 1.at3 1.en3 1.,3 Ho42 2. So 1.at2 / !ause and %%e(t5 6mpa(t and !onse7uen(e2 ii. 8So 1.at9 in terms o% nation-building2 1. Su((esses3 :ailures3 ;ensions2 1

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

2. Ne4 (onte<ts3 ne4 (.allenges3 ne4 (on(erns2

B. Introduction Singapores Economic Success o Singapore*s "er !apita =$" :igures# dramati( in(rease %rom 19>0 on4ards ?Singapore $epartment o% Statisti(s %igures@
Y AR 19>0 200D 2009 S=$ 130C0 0C3 00C 033 143 BS$ 01> 3C3 023 3>303D

b!ecti"es# $%e &onnections bet'een Economy-building and Nation-building o o &onnection bet'een economy and ot%er nation-building policies Economic de"elopment as t%e crucial pillar o( t%e Singapore nation Sound e(onom, as %undamental and ne(essar, (ondition %or t.e p.,si(al sur)i)al o% t.e nation (onomi( $e)elopment as marAer o% su((ess or )iabilit, o% nation.ood "romotes national identi%i(ation2

Economy-building as problematic (or nation-building (onomi( de)elopment or su((ess does not guarantee identi%i(ation 4it. t.e nation A $i)ided 6magined !ommunit,# =ro4t. at 1.at !ost2

)ey $%emes*+eatures o( Singapores Economic ,e"elopment - t%e .,e"elopmental State/ 2

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

i. ii. iii. i). ).

$ominant ?but (.anging@ role o% t.e Singapore state in e(onom,building !ooperati)e relations.ip bet4een state3 emplo,ers and labour ?!orporatism@ &penness to %oreign (apital3 e<pertise ?talent@3 in)estment3 labour $e)elopment and EobiliFation o% .uman resour(es Re'e(tion o% 4el%arism

&. P%ase 0 - A &olonial Entrepot to Import-Substitution Industriali1ation2 0345-0365 a. +rom $rade to Industriali1ation# i. !enturies-long .istor, o% being an entrepot port5 ma'or trans-s.ipment point ii. Hub# Not main inno)ator o% or marAet %or goods but %a(ilitates trade bet4een t.em iii. No industr, e<(ept t.ose related to t.e pro(essing o% primar, produ(ts %rom Eala,a and 6ndonesia# &il and rubber b. "er-reliance o( economy on trade and commerce# Problems a(ter 0345 i. $e(lining entrepot3 neig.bours be(ome (ompetitors ii. 6ndonesian +on%rontasi 19>3-19>> iii. Absorb unemplo,ment amid %ast-gro4ing population c. $%e Ans'er # Import Substitution Industriali1ation 7ISI8 i. 1.at is 6S62 1. +e, re(ommendation o% $ut(. e(onomist Albert 1insemius - t.e 81insemius Report9 in 19>0 ii. &t.er Ae, re(ommendations o% t.e 1insemius Report# 1. !reate spe(ial Fone areas %or .ousing industrial estates3 Gurong 6ndustrial state 2. =i)e ta< in(enti)es %or lo(al (ompanies 3. !ontrol labour and .old do4n 4ages 4. Bpgrade te(.ni(al training o% 4orAers

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

0.

(onomi( $e)elopment Hoard ? $H@ establis.ed to .elp lo(al (ompanies gro4 ?a%ter 19>03 re-oriented to4ards .elping attra(t %oreign in)estment@

,. P%ase 9 - E:port-oriented Industriali1ation2 0365 - circa 03;3 a. E:port- riented Industriali1ation 7E I8 i. 1.at is &6 ?)s 6S6@2 b. <%y= i. Separation %rom Eala,sia and :ailure o% t.e !ommon EarAet I 6S6 no longer possible ii. No natural resour(es5 .ig. population gro4t. rate and .ig. rate o% unemplo,ment iii. (onomi(s o% t.e !old 1ar# (.oi(e o% e(onomi( s,stems bet4een (apitalism and a 8(ommand e(onom,9

i). 19>D# B+ go)ernment announ(ed pull-out %rom militar, bases 1. )entual pullout 19D1

). Role o% $r =o. +eng S4ee ?191C-Ea, 2010@ 1. Held t.ese port%olios bet4een 1909 and 19C4# Einister o% :inan(e3 Einister o% $e%en(e3 Einister o% du(ation 2. Jondon-trained ?".d.@ e(onomist5 +no4n as t.e 8e(onomi( ar(.ite(t9 o% Singapore c. +eatures# +undamentals o( Singapores E I i. =lobal orientation3 e<port-oriented e(onom, ii. Hea), international in%luen(es K dependen(e on e<ternal en)ironment iii. 1orld pro)ide resour(es3 (apital and marAets. 8Jeap%rog9 un%riendl, region i). <isting Ad)antages t.en 1. Strategi( lo(ation in Asia 2. !.eap but sAilled labour %or(e3 e.g. 4orAers %rom na)al base and do(As 3. So(ial and politi(al stabilit, 4

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

4. Ad)an(ed port %a(ilities3 (ommuni(ations and transport in%rastru(ture le%t b, Hritis. 0. 6n.erited Hritis.-trained bureau(ra(, and legal s,stem d. Singapore model o( state-dri"en economic de"elopment 7Singapore-style capitalism8 i. JaisseF-%aire 4it. Singapore state as %a(ilitator o% &6 and entrepreneur 1. Huilt up in%rastru(ture and 4orA%or(e3 e.g. t.roug. urban rede)elopment3 land a(7uisition3 .ousing poli(ies and edu(ation 2. "ro-business poli(ies and ta< in(enti)es/.olida,s %or Eulti-national !ompanies ?EN!@ ii. =o)ernment*s strateg, o% %a(ilitating &6 (reated a (ormidable state apparatus geared to'ards generating economic gro't% and 'ealt% 1. ;ripartite model o% de(iding 4age le)els3 National 1ages !oun(il ?19D2@ 2. !ontrolling labour a. ;rade unions re-organiFed3 (o-opted into t.e National ;rades Bnion !ongress ?19>1@ i. S,mbioti(3 (ooperati)e relations.ip 4it. "A" go)ernment b. ;rade $isputes A(t 19415 !riminal Ja4 ?;emporar, "ro)isions@ A(t 1900 i. "ro.ibits politi(all, moti)ated striAes and striAes b, emplo,ees in essential ser)i(es (. 6ndustrial Relations &rdinan(e 19>05 Jabour mplo,ment A(t ?19>C@5 6ndustrial Relations A(t 19>C i. Regulate (olle(ti)e bargaining and dispute settlement t.roug. (on(iliation and 'udi(ial arbitration 3. !reation or re-orientation o% Statutor, Hoards and =o)ernmentJinAed !ompanies ?=J!s@ to dri)e/%a(ilitate e(onomi( de)elopment iii. Singapore 4as su((ess%ul in restru(turing its e(onom, i.e. %rom o)errelian(e on t.e entrepot trade to t.e (reation o% a )iable manu%a(turing industr, esp. ele(troni(s3 petroleum3 (.emi(al engineering

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

19D0s# double-digit gro4t. and lo4ering o% unemplo,ment rate

6ndi(ator/Y AR =$" =ro4t. Bnemplo,ment Rate per (ent

19>4 -4.3 NA

19>0 >.> C.D

19>> 10.> C.D

19>D 13.0 C.1

19>C 14.3 D.3

19>9 13.4 >.D

19D0 13.4 >.0

19D1 12.0 4.C

19D2 13.3 4.D

19D3 11.3 4.0

E. P%ase > - $%e 038?s @ t%e .Second Industrial Ae"olution/# a. &%allenges in t%e 038?s i. !ompetition %rom regional neig.bours ii. Rising produ(tion (osts erode strengt.s t.at attra(ted EN!s# :ear o% 8Hollo4ing &ut9 iii. Heginning o% tig.t labour marAet due to population poli(, re)ersal %rom 19C> i). 19C0 global re(ession and impa(t on Singapore b. Bo"ernment t'eaCed Singapores industriali1ation strategy i. &6 remained in pla(e but mo)e %rom labour-intensi)e industries to .ig.sAilled3 .ig.er )alue-added industries ii. $i)ersi%i(ation needed# e<pand non-manu%a(turing se(tors o% Singapore*s e(onom, iii. 8;otal Husiness !entre9 and 8Husiness Hub9 and regional %inan(ial (entre / one-stop .ub %or banAing3 %inan(ial3 business ser)i(es

+. P%ase 4 - Embracing Blobali1ation2 to'ards a )no'ledge-based Economy a8 $%e Blobal2 )no'ledge-Based Economy# Breater Integration 'it% Blobal Economy >

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

i. :rom 6n)estment-based to +no4ledge and 6nno)ation-based e(onom,# 8 ntrepreneurs.ip9 ii. =ro4ing an 8 <ternal 1ing9 t.roug. RegionaliFation# 8 <panding e(onomi( spa(e9 iii. Ne4 e(onomi( se(tors b8 <%y= International and domestic bacCground i. 6ntensi%ied globaliFation ii. Jimits to %o(using on manu%a(turing esp. inabilit, to (ompete up and do4n 8t.e te(.nologi(al ladder9 4it. e(onomies liAe 6ndia and !.ina

c8 Ma!or c%aracteristics i. Hased on (reation o% ne4 Ano4ledge and inno)ations and its uses and appli(ations %or e(onomi( gro4t. ii. Restru(turing Singapore*s domesti( e(onom, %or greater integration 4it. t.e global e(onom, iii. Ne4 emp.asis on de)eloping domesti( (apital3 (ompanies and labour d8 Aestructuring Singapores economy i. Singapore be(omes (apital e<porting (ountr, 1. 1990s# %rom re(ipient o% %oreign (apital in)estments to e<porter o% (apital 2. 1990-2000# Singapore*s dire(t (apital in)estments o)erseas surged 200L ii. Singapore*s So)ereign 1ealt. :unds ?S1:@ 1. 1.at are S1:s2 a. ;emaseA Holdings ?19D0@ b. =o)ernment 6n)estment !orporation ?=6!@ ?19C1@ iii. Ne4 +no4ledge-Hased (onom, Se(tors# Report o% (onomi( Re)ie4 !ommittee 2003# 1. Ser)i(es a. Eeetings-6n(enti)es-!on%eren(ing- <.ibitions b. 6n%o(omm and 6; (. !reati)e industries D

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

d. Healt.(are

2. Hiomedi(al R K $ as 4t. pillar

3.

du(ation# Singapore as 8=lobal S(.ool.ouse9

i). RegionaliFation 1. 8=ro4t. ;riangle9 ?Riau-Eala,sia-Singapore@ 2. $e)eloping a 8se(ond 4ing9/ e<ternal e(onom, ). Mer, aggressi)e signing o% :ree ;rade Agreements ?:;As@ to e<pand net4orAs and marAets NSee# 444.%ta.go).sgO

B. &%allenges and Issues a. Negati"e impact o( greater integration 'it% t%e global economy# > ma!or recessionsD i. 6n)estment-Hased (onom, / Mulnerabilit, to international/regional %lu(tuations K (rises3 a%%e(ted b, e<ternal s4ings in demand

ii. $ominan(e o% t.e state )s promotion o% lo(al entrepreneurs.ip 1. 8!ro4ding out9 and Alienation o% Small and Eedium nterprises ?SE s@ %rom EN!s and =J!s dominated big businesses 2. Ja(A o% inno)ation and (reati)it, blamed on go)ernment-.ea), e(onom,3 rote-learning e<am-based edu(ation s,stem3 o)erdis(iplined so(iet,2

b. Economic de"elopment and socio-economic issues (or nation-building i. Jinda Jo4 K Jee Soo Ann 8=lobaliFing State3 $isappearing Nation# ;.e 6mpa(t o% :oreign "arti(ipation in t.e Singapore (onom,9 1. 6n%lo4 o% %oreign (apital and %oreign talent/labour

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

2. &ut%lo4 o% lo(al talents ii. Problems and $ensions 1. $e(reasing sense o% belonging and national identit, 2. 6n(reasing in(ome ine7ualit, and (lass di)isions 3. So(ial tensions bet4een lo(als and %oreigners 4. Strains on in%rastru(ture and -ualit, o% Ji%e

iii. Ma!or c%anges in Singapores social maCe-up 1. Singapore "opulation P $e( 2011 / 0.2>m a. Residents 3.C1m / Non-Residents 1.40m i. !itiFens I 3.2Dm / "ermanent Residents I 0.04m ii. C3200 ne4 (itiFens per ,ear bet4een 19CD and 200> iii. 1C3000 per ,ear bet4een 200D / 2012 i). Increasing income disparity amidst rising costs o( li"ing 1. +H pri)ileges 8(ogniti)e elite93 (reati)e3 entrepreneurial 3 managerial3 pro%essional3 te(.ni(al (lasses 2. <a(erbates stru(tural unemplo,ment3 so(ial immobilit,3 in(ome ine7ualit, and (lass di)isions

3. =eorge Yeo3 1991 / Singapore be(oming 8t4o nations / t.e .a)es and t.e .a)e-nots9 ". States Aesponse# Increasing measures to address income ineEuality2 promote inclusi"eness and assist disad"antaged and "ulnerable groups 1. .g. 200D 1orA%are 6n(ome Supplement S(.eme

2. 2009 re(ession3 unpre(edented step o% dipping into Singapore*s reser)es to put toget.er a 8resilien(e pa(Aage9 3. Hudget 20133 &ontinued Emp%ases but Ne' Emp%asis on Social Spending a. "ubli( Assistan(e s(.eme in(rease b. 1ages !redit S(.eme (. 6n(reased .ealt.(are %inan(ing d. =ood and Ser)i(es ;a< Mou(.ers e. !entral "ro)ident :und Eedisa)e ;op-Bps 9

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

%.

Rebates on Ser)i(es and !onser)an(, !.arges

g. "ersonal 6n(ome ;a< Rebates

)i. Ne' Middle &lass demograp%ic ? du(ation Q Eobilit, Q A%%luen(e@ I $i%%erent Aspirations )s $e(reasing Abilit, to A(.ie)e t.em ?JinA to (o.esion3 sense o% belonging3 national identit,2@

)ii. Alienation o( citi1ens (rom economic restructuring and public policy-maCing# Perception o( state as pro(it-moti"ated 1. ;.e 8%oreign talent9/ 8ne4 immigrant9 issue 2. &)er-burdened publi( in%rastru(ture due to population in%lo4# t.e 1.ite "aper issue

H. &onclusion a. Fuestions to $%inC About i. &an Singapore remain economically competiti"e and rele"ant gi"en t%e c%allenges o( globali1ation=

ii. Is t%e Singapore model o( economic de"elopment sustainable (or nation-building in t%e long-run=

iii. Linda Lo' G Lee Soo Ann7pp. 043-05?8 -.Blobali1ing State2 ,isappearing Nation/=#

8 (onomi( progress and national unit,3 4.i(. in an earlier era 4ere mutuall, rein%or(ing3 ma, no4 run (ounter to ea(. ot.er9.

10

HY2229/SSA2204 Nation-building in Singapore AY2013-14 Semester 2

i). Is Singapore indeed .an impossible nation/ or .political !oCe/=

All Rig.ts Reser)ed dgar Jiao 2014

11