Transcript Singapore - BYU Marriott School

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)
http://www.odci.gov/cia/publications/factbook/geos/sn.html
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.”
http://www.mti.gov.sg/public/economgmt/fta.cfm
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
www.tdb.gov.sg
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
http://www.odci.gov/cia/publications/factbook/geos/sn.html
Economic History
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•
•
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 skillintensive 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
Local
Enterprise
Technical
Assistance
Screen
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.“
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In Singapore, it's considered perfectly acceptable to ask personal questions
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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
Gross secondary school
enrollment ratio
The Quantity Quality Transisiton '70-'85
100
90
80
70
60
50
40
30
20
10
0
Singapore
Japan
China
Hong Kong
Thailand
0
1
2
3
4
5
6
Total fertility rate
Lower labor rate growth – Higher human capital
Economic Growth
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$-
20.0%
GNP
15.0%
Percapita GNP
10.0%
5.0%
%D in GNP
0.0%
%D in Percapita
GNP
Employment ratios
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.
Percent
Time
90.0%
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
54.0%
53.0%
52.0%
51.0%
50.0%
49.0%
48.0%
47.0%
46.0%
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
-5.0%
19
89
19
91
19
93
19
95
19
97
19
99
Singapore Dollars
Economic Growth
Time
% union
% unemployed
%Male
%Female
The Church in Singapore
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•
•
•
Membership
Dedication
History
Economic Influence
– Economic development
– Western influence