Singapore Economy

Figure 1.-- Nost new countries afrer decolouization chose socialist, statist economic policies. Singapore led by Lee Kuan Yew chose a capitalist directiomn, becoming one of the asian Tigers. One of the characteristics of a Tiger Econimy is development of human resources. Singapore has one if the finest education sustems in the world.

Singapore like Hong Kong was created by the British. It began as a tiny, nomdescript fishing village likr countless others in Southeast Asia. It became a major outpost of the British Empire. The econmy was initally based on a local market fore regionally produced raw materials. Singapore becaome a buyer of raw material for processingand export. Sinapore achieved indeopence (1965). (After a brief federation with Malaysia.) At the time, there the only significant manufacturing industries were an elemental electrical assembly industry and some oil refining. With the independence, these two sectors took off rapidly. There was an especially important expansion of oil refining (1960s). The electronics industry was aided by Texas Instruments which built a semiconductor manufacturing plant (1967). Singapore patriarch Lee Kuan Yew adopted free market capitalism at a time when most newly independent countries persued socialism. Singapore became one of the Asian Tigers. Texas Instruments was attracted by tax incentives. Other foreign electronics companies also set up plants. Singapore became an important part of the expamding electronics industry. Sinapore mafe a name for itself as an atrractice place to do business in Asia. Pharmaceutical companies was the next major industry to enter Singapore. While manufacturing led the way, services followed. By far the most important was financial services. Singapore privided the security need for a financial services sector. It was a haven for the violent chaotic situation of neignoring countries. And the exciting life of one of the world's most viubranbt cities became a tourist draw. Singapore free market, capitalist policies including government intervention, low inflation, prudent macroeconomics, have led to high growth amd rising incomes. Singapore has developed rapidly into not only a huge port, but major financial center. The result was unlike widespread economic failure in most newly independent countries, Singapore was one of the most successful economies in the world. Singapore became one of the Asian Tigers which achieved rapid economic growth and high percapita incomes. In recent years the Government has been attempting to increase the participation in the hisher end manufacturing operations. They are pushing innovation along with research and development so that the country not only assembled compoments. They are also entering biotechnology and other high-tech sectors. The Government wants Singapore to become a center for new ideas to beinvented rather than executed. The country has a n excellent, modern educatiin system, but on that is not yet producingyoung peole best suited for this change. Manufacturing is, however, only a quarter of the economy. Services are much more important, especually finanaciual services. Singapore was adversely affected by the Asian financial crisis (1997-98). The Government responded with heavy investment in new infrastructure. Stock markettrading was liberalized and banking restrictions eased to improve the country's competitive edge over regional comptetitors.


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Created: 4:18 AM 10/28/2019
Last updated: 4:18 AM 10/28/2019