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Singapore’s Economic Policy: Is It Sustainable?

TL;DR –  Sustainability is all about a balancing act.

Singapore has become richer, fancier, prettier since it gained independence in 1965.

Just take a look at the ridiculous factors our economy has grown by over 50 years.

How has Singapore grown since 1965?

For example, our GDP per capita has increased 45 times from $1,580 to $71,318.

We have diversified our businesses from an entrepot trading post with 14% GDP dependent on the British army in the 1970s to 23 industries in six clusters today.

Our economy has exploded since 1965 (via)

Our foreign reserves have grown 85 times from $4bn in 1972 to $340bn in 2014.

More government transfers to balance more inequality (via)

We have consistently adapted our growth strategies as we transformed from a small country dependent on entrepot trade and British military bases, to one which aims to foster sustained and inclusive growth in a volatile global economic environment.

Change is a constant (via)

EDB has also recently announced that:

  • 32,814 jobs will be created over the coming years
  • we attracted investment commitments of $15.2b in fixed asset investments, and
  • $9b in total business expenditure per annum (which goes to spending on wages and services), better than expected.

EDB’s 2019 Year in Review (via)

We seem to have hit it right with our economic strategy, with Minister Chan Chun Sing saying:

“When overseas businesses invest in Singapore, they’re increasingly looking at the four aspects of long-term stability, protection of intellectual properties, how holistic and comprehensive our legal system and framework is and also our network and connectivity (including connectivity in terms of data and financial services).”

“These are areas that we’ve traditionally been strong in and have further strengthened these unique advantages and hence, Singapore has been able to attract the next wave and generation of business investments.”

How much do policymakers care about sustainability?

It is only since 1965 that Singapore was an independent, sovereign nation. The shock of independence forced the necessity of sustainable development upon the policymakers.

As explained in several excerpts in Singapore’s Voluntary National Review Report to the 2018 UN High Level Political Forum on Sustainable Development, an 84-pager report detailing Singapore’s approach to 17 Sustainable Development Goals (SDGs):

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“Sustainable development has underpinned Singapore’s policymaking since our independence. When independence was thrust upon us on 9 August 1965, Singapore lost its hinterland. We were almost entirely dependent on external sources for basic needs like food, energy, and water. The future was uncertain. Many were sceptical that Singapore could survive on its own, let alone prosper.

The Dive: Most Singaporeans do not know what Sustainability is about, but our Government does

 

Under these grim circumstances, Singapore’s pioneer team of leaders set out to transform Singapore into a viable nation-state. Faced with limited land and resources, our pioneer leaders had to quickly address pressing concerns while adopting a long-term perspective in policymaking. They concentrated efforts in developing education, security, infrastructure, healthcare, and housing, while bearing in mind the need to be prudent and strategic so as to maximise resources.”

sustainable

All these goals are interconnected (via)

Sustainability is a journey in progress

Although our economic growth has been stellar, it is not perfect. There are many works in progress on our sustainability journey that attract criticisms.

Nikkei recently pointed out how poverty and nativism resentment has been on the rise in Singapore. It seemed to interpret absence of evidence (due to lack of interviews and replies from government representatives) as evidence of absence (of concern by policymakers towards the vulnerable).

An opposition party SDP found government statistics on employment disturbing, stating the need for a comprehensive approach (but it did not provide suggestions).

On government transparency with data, a professor asserted that the Singapore government was “deliberately evasive”, which was addressed by the government that the facts had already been provided and reported in the news.

As Singapore moves into a more uncertain world where disruption is the norm, the questions of different sustainabilities (and whose responsibility it is to look into questions) become more complicated.

Imagine balancing this “plate” of different sustainability goals on your finger. Whatever you do this time round, will be handed over to the next person to continue the balancing act. (via)

Can we reduce the number of foreigners coming into Singapore? How much per country of origin? Are we prepared to do their jobs, work longer hours and be as productive, for the same pay? How can the government and us make ourselves more attractive to hire than foreigners? Will property prices fall?

Can we send more Singaporeans overseas to bring in the skillsets we need to be globally competitive? If some MNCs can’t get the talent they seek here nor import them, are we okay with these MNCs moving out of Singapore to base themselves elsewhere in the region and recruit other talents there who demand lower wages and have a younger population which is increasingly more educated?

If we want to produce less waste, charge for plastic bags and raise water taxes to incentivise people to be more environmentally-friendly, how do we influence others to support these initiatives? How can we diversify our sources of food, such as creating more community gardens, and preempt quarrels over food distribution?

How can we attract more Singaporeans to be hawkers where they can earn a sustainable income and have work-life balance? Are Singaporeans prepared to fork out more for other Singaporeans to earn a decent living?

Can we mandate a universal basic income that is financed in a sustainable manner without disincentivising Singaporeans from working? How can we place more vulnerable Singaporeans in jobs sustainably where they stay for at least 6 months? Do we need to develop new train and place curriculums that are more tailored to both the jobseeker and the job? How customised can we make this curriculum and how can we revolutionise learning?

Is our healthcare system sustainable in terms of personal financing, government welfare, staff strength, keeping up with chronic diseases, etc? Where are the gaps people fall through? How do we attract more people to support our ageing population without contributing to a significant increase in cost for the elderly?

How can we encourage creativity and diversity in schools while standardising assessments? What life skills and values can we impart to our young while ensuring they are competitive in their hard skills? How can we bridge the generation gap between employers and young graduates who may have different workplace values?

If we don’t have enough kids to replace ourselves, and we don’t want to import foreigners, are we OK if people and companies start to leave if our future generations are not enough to maintain, let alone grow, the economy? If Singapore becomes a ghost town, do all of us have the means to migrate? Would we b OK being part of a larger nation?

Would we be OK to lose Singapore?

Sustainable development issues cannot be addressed in silos or in a vacuum. Hence quick fix suggestions are usually more quick than fix.

How to ensure Sustainability with an ageing population: Singapore is so young, but ageing so fast!

Sustainability is about meeting the needs of the present without compromising the ability of future generations to meet theirs. The concept of sustainability is composed of three pillars: economic, environmental, and social—also known informally as profits, planet, and people (3Ps)

The sweet spot where all three Ps meet is where Sustainability happens (via)

Sustainability cannot be just about the green movement. It is not just about one, or two of the 3Ps.

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If you haven’t figured it out by now, this piece has been talking mostly about the Profit, i.e. economic, part of the 3Ps of Sustainability.

What we’re trying to tell you is this: There is no single entity solely responsible for Singapore’s journey towards its sustainable goals. Don’t waste this food for thought.

Sustainability: Singapore imports 90% of our food supply, can we survive if a crisis cuts it off?

 

 

Read others in the Sustainability series

 

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Jules of Singapore

Author Jules of Singapore

I live to travel, to countries, through perspectives, to share the journeys that make us human.

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