• About Us
    • Fact Checking Policy
    • Ownership & funding information
    • Volunteer
  • Subscribe
  • Letter submission
    • Submissions Policy
  • Contact Us
The Online Citizen Asia
  • Opinion
    • Editorial
    • Commentaries
    • Letters
    • Comments
  • Current Affairs
    • Singapore
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Arts & Culture
    • Consumer Watch
    • NGO
    • Lifestyle
    • Travel
  • Politics
    • Civil Society
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
No Result
View All Result
  • Opinion
    • Editorial
    • Commentaries
    • Letters
    • Comments
  • Current Affairs
    • Singapore
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Arts & Culture
    • Consumer Watch
    • NGO
    • Lifestyle
    • Travel
  • Politics
    • Civil Society
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
No Result
View All Result
The Online Citizen Asia
No Result
View All Result

What’s wrong with the current Singapore growth model?

by onlinecitizen
16/02/2011
in Current Affairs, Politics
Reading Time: 6 mins read
0

The Singapore economy is near breaking point and cannot be sustained going forward without society tearing apart, says a former government economic planner who has just completed a 45-page paper “Creating Jobs and Enterprise in a new Singapore economy – Ideas for Change”. Tan Jee Say feels strongly that new economic directions are urgently needed to prevent a socio-economic tragedy from unfolding, and he has proposed a $60 billion National Regeneration Plan to transform Singapore into a knowledge-based regional services hub that puts Singaporeans first in jobs and enterprises created in a new Singapore economy.

Jee Say’s analysis and prescription are persuasive, according to Lord Butler who as Head of the British Civil Service in the 1980s and 1990s, oversaw the “painful transition” of the United Kingdom from a predominantly manufacturing economy to a knowledge-based one. Lord Butler commended the paper and described it as a thorough and well-argued piece of work that deserves the attention of policy makers.

The following is the first in a three-part summary extract from the soon-to-be-published paper.

by Tan Jee Say

The Singapore economy has become more volatile in recent years, with business cycle fluctuations becoming more pronounced, and Singapore experiencing three recessions (1998, 2001 and 2009) in the past 15 years, in contrast to only one recession (1985) in the 30 years between 1965 and 1995. The greater volatility led to more job losses that lasted for longer periods. Volatility has resulted in lower growth.

Low Productivity

Singapore’s low labour productivity growth in recent years is a statistical phenomenon and is the result, not the cause, of our poor economic performance. To focus on raising productivity as a key economic strategy, an old and discredited strategy adopted by the government since the early 1980’s, is like putting the cart before the horse – can we expect it to succeed when it has failed to do so in the last 30 years with productivity continuing to be stuck in the lows to this very day in spite of all the high-sounding campaigns by high-level productivity councils? Rather we should focus our minds on economic policy because it is bad economic policy that has resulted in Singapore’s heavy dependence on foreign unskilled and low-skilled workers that in turn pulls down labour productivity.

Unsustainability of Manufacturing

A major contributor to the increased economic volatility was manufacturing which has been promoted by the government in the past 5 decades as a key pillar of its economic growth strategy. The strategy was successful in the first 2 decades but by the early 1980’s, it was running into bottlenecks as Singapore’s constraints manifested themselves.

Singapore has little comparative or competitive advantage for manufacturing to flourish as land, labour and skills are in short supply. The manufacturing sector can only remain viable in Singapore through more subsidized factory land and space, uninterrupted inflow of cheap foreign labour, and generous tax holidays and other giveaways. Such economic distortions in the last thirty years have delayed Singapore’s economic restructuring. We cannot afford and should not tolerate further wastage, not even for another year.

Two additional factors weigh against manufacturing – firstly, most top students are not opting to read engineering as their first choice in the local universities and polytechnics, a trend that does not augur well for the innovative potential of nor the prospect for ‘complex manufacturing’ , a niche that the ESC wants to promote; and secondly, Singaporeans are happier working in the services sector than in manufacturing industry. Without a happy and talented workforce, can complex manufacturing succeed in a sustainable way?

Which Services for the Future?

Singapore’s future lies in services. We can thrive as a dedicated services hub for the region as we had done so in the past as a vibrant commercial metropolis even before Singapore went into manufacturing in a big way in the 1960’s.The rest of the region has also progressed as we have. To continue to be relevant to them, we have to develop into a full-fledged integrated services hub with the best offerings available in the field. It should be knowledge-based that will capitalise on Singaporeans’ high level of education and experience of the world’s best practices. It must be the right kind of services that do not exploit or offend the sensitivities of the region.

Picture credit: http://en.wikipedia.org/wiki/Marina_Bay_Sands

The two huge casinos are the wrong kind of services activities to have. Economic development is more than just about generating jobs and income growth. There is a moral purpose as well, otherwise we might as well turn Singapore into a prostitution hub or a distribution centre for drugs which will bring us untold riches. Economic development is about developing and using human capital to produce decent and worthwhile goods and services in a sustained way.

On the other hand, casinos are a soft option that preys on human weakness to generate profits. They destroy the work ethic and lead to broken families and other social problems. The casinos should be closed down so that Singapore can part company with those who choose to prosper through vices such as gambling, prostitution or drugs; only then can Singaporeans once again walk tall and proud on the high and honourable path to economic development and prosperity.

To make up for the economic loss from closing down the casinos, we need to move aggressively to develop those services we are currently good at providing so as to yield quick returns such as services involving the port, transport connectivity, financial institutions, education and healthcare. While we can be proud of having good basic infrastructure, there are still serious gaps to be filled particularly in education and healthcare. Once these holes are plugged, Singapore will have a fully developed infrastructure that will enable it not only to uplift the well-being and standard of living of its own citizens but also have additional capacity to serve the needs of the region.

End of Part One. You can read Part Two here

________________________

The writer was with the Ministry of Trade and Industry from 1979 to 1985 where he headed economic and manpower planning and also served as secretary to the late Dr Albert Winsemius, the economic adviser to the Singapore Government. From 1985-1990, he was the principal private secretary to Mr Goh Chok Tong. In 1990, he went into investment banking and subsequently took up fund management. He is a Chartered Fellow of the Chartered Institute for Securities & Investment. He is a graduate of Oxford University where he read philosophy, politics and economics.

He will be sharing his insights of the Budget 2011 this coming Saturday 19th Feb at TOC’s Budget Forum 2011.

For just US$7.50 a month, sign up as a subscriber on The Online Citizen Asia (and enjoy ads-free experience on our site) to support our mission to transform TOC into an alternative mainstream press.

Related Posts

Singapore warns slower economic growth in 2023
Labour

Less than 1 in 10 jobs created in first three quarters of 2022 went to Singaporeans?

28/01/2023
Peru Congress rejects president’s plan for early elections
AFP

Peru Congress rejects president’s plan for early elections

28/01/2023
UMNO purging members as it sacks former health minister Khairy and suspended ex-defence minister Hishammuddin
Malaysia

UMNO purging members as it sacks former health minister Khairy and suspended ex-defence minister Hishammuddin

28/01/2023
WHO panel in talks on COVID emergency status
AFP

WHO panel in talks on COVID emergency status

27/01/2023
AFP

Two years after Myanmar coup, UN says situation ‘catastrophic’

27/01/2023
Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health
Community

Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health

27/01/2023
Subscribe
Connect withD
Login
I allow to create an account
When you login first time using a Social Login button, we collect your account public profile information shared by Social Login provider, based on your privacy settings. We also get your email address to automatically create an account for you in our website. Once your account is created, you'll be logged-in to this account.
DisagreeAgree
Notify of
Connect withD
I allow to create an account
When you login first time using a Social Login button, we collect your account public profile information shared by Social Login provider, based on your privacy settings. We also get your email address to automatically create an account for you in our website. Once your account is created, you'll be logged-in to this account.
DisagreeAgree
0 Comments
Inline Feedbacks
View all comments

Latest posts

Singapore warns slower economic growth in 2023

Less than 1 in 10 jobs created in first three quarters of 2022 went to Singaporeans?

28/01/2023
Peru Congress rejects president’s plan for early elections

Peru Congress rejects president’s plan for early elections

28/01/2023
UMNO purging members as it sacks former health minister Khairy and suspended ex-defence minister Hishammuddin

UMNO purging members as it sacks former health minister Khairy and suspended ex-defence minister Hishammuddin

28/01/2023
WHO panel in talks on COVID emergency status

WHO panel in talks on COVID emergency status

27/01/2023

Two years after Myanmar coup, UN says situation ‘catastrophic’

27/01/2023
Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health

Grab driver supposedly earned $5,227.82 in a week prior CNY, netizens voice worries over his health

27/01/2023
Philippines to appeal ICC resumption of drug war probe

ICC grants new inquiry into Manila’s deadly ‘war on drugs’

27/01/2023
Minister refutes claims of Malaysia consulting Singapore on housing policy due to its inefficient civil service

Minister refutes claims of Malaysia consulting Singapore on housing policy due to its inefficient civil service

27/01/2023

Trending posts

Two Indian nationals paid about S$330 and S$730 respectively for forged certificates submitted in their S-Pass application

MOM found issuing EPs meant for foreign PMETs to PRC waitress and general worker

by Correspondent
26/01/2023
40

...

Earning only S$400 a month, delivery-rider turned hawker threw in the towel after two years of running a rojak stall

Earning only S$400 a month, delivery-rider turned hawker threw in the towel after two years of running a rojak stall

by Yee Loon
26/01/2023
24

...

Ho Ching breaks silence over Temasek’s write down of its US$275 million investment in FTX, says it “can afford to be contrarian”

US regulator questions VCs’ due diligence work prior to investing in FTX; Ho Ching says Temasek can afford to be contrarian

by The Online Citizen
24/01/2023
28

...

Indian rupee falls 60% since signing of CECA while Singapore becomes top investor in India

by Correspondent
25/01/2023
56

...

Temasek and GIC reportedly in talks with Adani Group accused of “brazen” market manipulation and accounting fraud

Temasek and GIC reportedly in talks with Adani Group accused of “brazen” market manipulation and accounting fraud

by The Online Citizen
26/01/2023
48

...

What’s wrong with the current Singapore growth model?

by onlinecitizen
16/02/2011
0

...

February 2011
M T W T F S S
 123456
78910111213
14151617181920
21222324252627
28  
« Jan   Mar »
  • About Us
  • Subscribe
  • Letter submission
  • Contact Us

© 2006 - 2021 The Online Citizen

No Result
View All Result
  • Opinion
    • Editorial
    • Commentaries
    • Comments
  • Current Affairs
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Civil Society
    • Arts & Culture
    • Consumer Watch
    • NGO
  • Politics
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
  • Lifestyle
    • Travel
  • Subscribers login

© 2006 - 2021 The Online Citizen

wpDiscuz