COUNTRY STUDY SINGAPORE

An Overview In 1819, Singapore was founded by a British colony. It joined Malaysian Federation in 1963 but was asked to leave two years later. Singapore became independent in At the outset, it had to follow outward-looking industrialization policy, due to the small size of the domestic economy.

An Overview (continued) Singapore had an impressive growth rate of about 10% (and 8% during ). Singapore had almost full employment of labor (1.7 percent to 3 percent unemployment rates). Singapore’s population is approximately 4.6 million, with working age population representing 77% of the population.

An Overview (continued) Three ethnic groups: Chinese-77%, Malays-14% and Indians-8% Open and corruption-free economic environment along with legendary cleanliness if the city-state. Per Capita Income: $52,000 Agriculture: 0% Manufacturing: 33% Services: 67%

Development Model Export-Orientation Foreign investment in manufacturing sector from almost 3,000 MNCs Heavy dependence on foreign workers (600,000 in 2000)-constitutes 27% of the labor force Government intervention in many economic activities-compulsory saving schemes, pro- business and pro-labor government is a unique feature Central Provident Fund

Development Model (continued) State-directed investments in strategic government-owned corporations Development of technological sector, biotech industries and pharmaceutical sector Financial and technology hub with its attractive infrastructure and skilled workforce

Current Developments/ Problems Global Recession Resource shortages: land, water High-cost economy-labor shortage and inflation, high rents. In 2006, office rents tripled Pharmaceutical hub and growth of R&D and scientific knowledge Labor disputes: Foreign workers; Government encourages early resolutions Strong trade unions – but work government and management Reduce dependence on ICT global demand