Singapore Jake Wasden Jen Francom Martha Parks Melinda Brimhall Tami Davis Mark Carter

Political Background Founded as a British trading colony in 1819 Joined Malaysia in 1963 Withdrew from Malaysia in 1965 and became independent Established a parliamentary republic Established a legal system based on English common law (but has no juries)

Impact of Independence Senior Minister Mr. Lee Kuan Yew stated the following: “...we faced the prospect of economic decline with Indonesia confronting us and cutting off all economic links and Malaysia also determined to bypass Singapore and deal direct in her imports and exports”

What Did They Do?  Adopt an authoritarian political style— governed by Mr. Lee Kuan Yew, leader of the PAP  Focus on common values of modernization —"think of future common endeavours and achievements" instead of "the distinct contributions of each community  Immigrants gave their allegiance (residence and citizenship) to Singapore— reorient the loyalties owed to larger political units such as China, India, Indonesia and Malaysia and focus them on Singapore Philosophy change in people Philosophy change in business

System Implemented to Achieve Success Free Market “With the free market system, we allowed open competition not only among domestic firms, but also from foreign firms and products. This ensures that local companies remain competitive without having to shut themselves out from external competition. Consumers also benefit from lower prices.”

System Implemented to Achieve Success Singapore Trade Development Board— 35 offices worldwide –Established in 1983 to do the following: Developing Singapore as a premier international trading hub Promoting Singapore’s good and services overseas Pioneering entry into new markets Attracting international traders to base in Singapore Advancing the nation’s external trade interests

Example of Expanding the Nation’s External Trade Interests The Asian Pacific Economic Cooperation (APEC) Asian Development Bank (AsDB) Association of Southeast Asian Nations (ASEAN) Australia Group (observer), BIS, C, CCC, CP, ESCAP, G-77, IAEA, IBRD, ICAO, ICC, ICFTU, ICRM, IFC, IFRCS, IHO, ILO, IMF, IMO, Inmarsat, Intelsat, Interpol, IOC, ISO, ITU, NAM, OPCW, PCA, UN, UNCTAD, UNIKOM, UPU, WHO, WIPO, WMO, WtrO

Economic History GDP grew 8.6% annually on average between 1965 and 1999 Real capita GDP grew eightfold from $4000 to $32,000+ Inflation average 3.2%

Structure of Economy

Economic Strategy Lacks Natural Resources Liberal Trade & Foreign Investment Policies Increase exports by attracting Foreign Investors This decreased unemployment by creating jobs

Composition of Exports

Exports $128 Billion annually Electronics is the major export Singapore shifted to higher capital and skill- intensive products Food, beverages, garments and furniture 1980’s—disk drives 1990’s—semiconductors

Foreign Investment 1998 foreign equity investment stood at $158 billion, an increase of 14% over $139 billion in 1997 International trade in Singapore is equivalent to 300% of GDP In the manufacturing, foreign direct investment accounts for 70% of total investment Applied tariff is zero Excise taxes levied on a number products (motor vehicles, alcohol products, motor oil…) –Average rate was 9.7% in 1999 (projected to decline to 6.9% in 2005) Limit on foreign ownership of companies listed on the Singapore Stock Exchange was raised from 49% to 70% Likely to face competition from lower-cost producers in the region

Technology Transfer L ocal E nterprise T echnical A ssistance S creen Financial District in Singapore

Culture The group, rather than the individual The personal relationship you build Singaporean business culture is very ethnocentric Singaporean business culture is intensely competitive and has an exceptionally strong work ethic. Outbursts of laughter are not always indicative of mirth in this culture. More often, laughter is used to mask "loss of face", nervousness, shyness, or disapproval. Sucking in air through your teeth is one way to signal a definite answer of "no.“ In Singapore, it's considered perfectly acceptable to ask personal questions Punctuality is essential for business appointments Singapore prides itself on being the most corruption-free state in Asia. Consequently, it has strict laws against bribery. Government employees may not accept gifts of any kind. Singaporean listening etiquette dictates that you count to 10 before responding

The Quantity-Quality Transition in Asia Mark Montgomery, Mary Arends-Kuenning, Cem Mete Lower labor rate growth – Higher human capital

Economic Growth The Singapore labor market offers relatively high wage rates and working conditions consistent with international standards. However, Singapore has no minimum wage or unemployment compensation. Because of labor shortages, wages have generally stayed high.

The Church in Singapore Membership Dedication History Economic Influence –Economic development –Western influence