Singapore Economic Development Flashcards
What were the characteristics of Singapore that contributed to its success (3 points, economic system, orientation, governance)
- free enterprise economic system
- outward looking orientation
- sound, transparent governance
What was Singapore’s average GDP growth rate from 1961 to 2001
8.3%
What were the government strategies of Singapore in the 1950s (3)
Foreign advice
- reliance on entrepôt trade
- start of industrial development
- incentives to promote new industries and investment
What were the government strategies from 1960-64 (ISI or EOI, state role?), and what was the context
Merger: ISI
- ISI under Malaysia
- EDB and state’s infrastructural role in industrialisation
What was the context of 1965 - 80 and what were the government strategies (4)
Independence, loss of common market
EOI and restructuring
- ISI to EOI
- incentives for export orientation
- developing human capital
- foreign investment
- growth in manufacturing
What was the domestic context behind 1980-90s (hint: labour) and what were the government’s strategies (4)
Beyond EOI: IT, services, regionalisation
- state agencies and policies to develop higher value-added industries
- “total business centre”
- regional drive
- diversification of economic base
What was Singapore’s exports as a percentage of GDP from 1950-60 and 90-2000
130, 180%
how big was the services and commerce sector labour force in 1947 (foundational)
30%, 23%
What were the 3 key foreign advices (and from which years) during Singapore’s industrialisation and restructuring, which advices led to which policies (3)
1955: IBRD stressed importance of expanding industrial sector, government playing infrastructural role
1959: Lyle report - industrialisation through establishing government organisation, foreign investment
- pioneer industries ordinance - no taxes for pioneer manufacturers
- industrial expansion ordinance - varying degrees of income tax relief as firm expands
1961: Winsemius report - expansion of industrial sector
- development plan 1961-64
- establishment of EDB
What percentage of total money allocated to development went to economic development
58%
Which 2 corporations were setup by the EDB by 1968
DBS, Jurong town corporation (JTC)
What other economic subsidiaries were established together with the EDB from the 1960s to 70s (3)
- Neptune orient lines (NOL) in 1969 — lower freight charges for sg manufactured goods
- central providence fund (CPF)
- POSB
Why did Malaysia and Singapore want a merger (how would it benefit both parties - consider production, market and revenue benefits)
SG:
- benefit from usage of Malaysia’s natural resources to industrialise
- common market in Malaysia
Malaysia:
- portion of SG revenue as economic benefit
When did the British forces announce their withdrawal, and by when would they withdraw
- ## Announced in 1967, withdrew by 1971
How many jobs were lost due to the British withdrawal from Singapore, and what percentage of national income
40,000, 10% of national income
What percentage of GDP was accounted for by the manufacturing sector in 1975, and up by how much from 1965
22%, up from 14% in 1965
Which deputy prime minister began the move towards EOI after independence
Goh Keng Swee
What 2 methods allowed us to transition to EOI
- government incentives
- foreign investment
What were the 2 focuses of government incentives during EOI (which sector/market)
- Export industries
- manpower training
What were some of the export incentives implemented by the singaporean government (4)
- concessionary tax rates for export enterprises
- lower interest rates by MAS
- export credit insurance scheme (1976)
- small industries finance scheme (1976)
What were some measures taken to increase support for manpower training
- industrial training centres set up
- education system restructured in 1968, emphasis on technical and vocational skills (e.g. Ngee Ann college, Singapore polytechnic)
By 1976, what percentage of Singapore’s exports came from foreign affiliated companies
70%
In what 3 ways did the government lead to increased foreign investment?
- Political stability
- Policies for investment promotion (tax exemptions, repatriation of profits, simplification of immigration procedures)
- Upgrading of infrastructure
What characterised 1979
Second Industrial Revolution
Why and how did the “second Industrial Revolution” occur in Singapore
- shortage of labour
- transition from low-skilled labour intensive to high tech sophistication, knowledge intensive production
When was the 10 year economic plan unveiled and by who
Goh chok tong, 1981 budget speech
- develop Singapore into a modern industrial economy — high value products
What 2 corporations were added and refined to promote high value added production, and in which year
1983:
- STC (Singapore technologies corporation) - promote advanced technologies
- GIC
What was the rate of increase of value added per worker from 1970-84
Double
What caused the economic slowdown from 1981 to 86 that showed Singapore’s vulnerability to global trends
- high wage bills, tightening labour force -> less attractive as investment destination
- protectionist tendencies of other developed countries
- low petroleum prices
When was the Economic Committee established to spearhead the growth of the services sector
1986
What was the “total business centre”
- provision of range of corporate services to global companies using SG as headquarters
- building of clusters
When was the cluster development fund, and how much was it
1995, 1 billion
What percentage was the services sector in 2010 compared to 1965
28% vs 16%
What characterised Singapore’s economic landscape in the 1990s
Regionalisation
What was regionalisation
Integrating Singapore based enterprises with regional economies — Singapore inc.
What were 2 examples of regionalisation
- Johor Riau growth triangle (Indonesia, Malaysia)
- Suzhou industrial park
By what factor did direct investment from abroad to Singapore increase by from 1989 to 1990
2x
What percentage of FDI came from Asian and ASEAN economies respectively
1/2 from Asia, 1/3 invested from ASEAN economies
What were the main factors for economic growth in Singapore (4)
- Free-enterprise system
- Onward looking orientation
- Natural endowment and historical experiences (entrepôt and its benefits of driving SG’s economy towards EOI and high value)
- Political stability between state and non state actors (due to alliance of English educated nationalists and Chinese working class in PAP)
By what percent did manufacture contributions to gdp (%) increase by in the 1970s
20% to 29%
From what to what percent was the fall in primary exports from 1975 to 1995
50% to 15%
What were the 2 limitations of the government’s strategies
- Social divisions
- Vulnerability to external developments (AFC)
By what percent (against USD) did the SGD fall by during the AFC
20%
By what percentage did the STI drop by from 97 to 98
62%
Why was Singapore hit by the AFC (in terms of banks and NPLs, stats)
- invested or lent significant amounts to firms in neighbouring countries — SG banks with a lot of NPLs (8% by 1999)
What were Singapore’s sound fundamentals in context of
- current account
- external debt and borrowing
- financial liberalisation and regulation
- CA surplus of 15% pre AFC - 1997
- No external debt since 1995
- Strict supervision under MAS
How did the singaporean government respond to the AFC
- tightening of property market (1996)
- 30mth deadline for developers to complete construction
- stamp duty for ppl staying less than 3 years
- taxes on property - Already floating currency pre crisis — controlled by MAS (against speculation) and huge foreign reserves
- Government refrained from government intervention to preserve open economy, capital flows and foreign investment
- Wage cuts in cost cutting package (incl employer’s contribution to CPF
What type of fiscal policy did the government pursue in 1999, and what did it involve
Expansionary:
- education, nfrastructure, job creation — increase attractiveness to foreign investors
What was the GDP growth rate in 1999
5.4%
What type of role did the singaporean government play in economic success
Pervasive
What role did the EDB play in economic success
Infrastructural role
What was the email enterprise bureau and when was it established
- statutory board
- developed and upgraded SMEs
- 1986 in wake of recession
How did the singaporean government manage labour relations
Trade unions (NTUC)
What are some examples of state owned companies and corporations
Temasek Holdings, ST , Keppel shipyard, SIA, Neptune orient lines
What was the Economic Committee
- representatives from trade associations and entrepreneurs — cooptation of private interests and state interests
What was the overall nature of state intervention in Singapore (compared to Indo or Philippines)
- stimulating private capital through collaboration
Vs - state domination over private sector
