fbpx

Singapore, the 'miracle' economy?

~ By Gordon Lee ~

Lee Kuan Yew. He is a great visionary and the pioneering architect of Singapore’s economic miracle - or so we are told.

Just last week, The Economist published an article titled Dangerous Delusions, which amongst other things said, “The People’s Action Party (PAP) is anxious to take as much credit as it can for Singapore’s undoubted success.”

My interest was piqued and I decided to study the issue further. The question I wanted to study was this:

When it comes to economic management,
has the PAP been any more successful than the British whom they replaced?
And has the PAP been given too much credit for Singapore’s economic growth?

 

Singapore before PAP: A Developed City

Much has been said about how Singapore was already blessed with a strategic location (which the far-sighted Sir Stamford Raffles recognised), and how it was already a thriving and prosperous port city. The British had provided for paved roads and good transport links, a functioning legal system and a rule of law, an efficient civil service and bureaucracy, etc.

But seeing is believing, and the following video shows Singapore as far back as 1938.

Singapore is hardly as “undeveloped” as we may be led to believe.

Singapore’s post-British economic growth

Singapore and Hong Kong are two small island cities with majority Chinese population, ruled by the British from the early 19th century, established as trading ports within the British empire, lost to the Japanese during the Second World War, and returned to British rule after the Japanese surrender.

By the early 1960s, both cities were remarkably similar on indicators such as crime, education enrolment, and the economy. But there was soon to be one crucial difference - the British left Singapore in 1962 but continued to run Hong Kong till 1997.

How did the economic trajectory of the two cities differ? Looking at a graph of Gross National Income (GNI) per capita, there seems to be no practical difference!

Singapore and Hong Kong also shared long working hours, and relatively high labour productivity rates [1].

Besides economic indicators, by 1997, both cities had a similarly high literacy rate [2], low homicide rate [3], high imprisonment rate [4, high income inequality rate [5], moderate suicide rate [6], low teenage pregnancy rate [7, and low abortion rate [8].

So whilst the PAP deserves credit for keeping Singapore “in shape”, I come back once again to my main question: When it comes to economic management, has the PAP been any more successful than the British whom they replaced? And has the PAP been given too much credit for Singapore’s economic growth?


[1] www.asiaone.com/Business/News/My+Money/Story/A1Story20100129-195280.html

[2] www.moe.gov.sg/media/speeches/1998/13oct98.htm

[3] www.crime.hku.hk/rb-crimetrends.htm

[4] www.crime.hku.hk/rb-crimetrends.htm

[5] www.mas.gov.sg/resource/eco_research/eco_education/Esss2007/uni_%201st_%20Ishita.pdf

[6] www.who.int/mental_health/prevention/suicide/country_reports/en/index.html

[7] www.dcsi.sa.gov.au/Pub/Portals/7/unplanned-teenage-pregnancy-part-c-statistics.pdf

[8] www.guttmacher.org/pubs/archive/Sharing-Responsibility.pdf

_______________________