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While the Singapore stock market has been powering upwards again in the early days of the Snake, the last few weeks has seen a significant downturn, most possibly due to fears of global investment downturns in the wake of the a slowing US economy and Dot Com disenchantment.
Singapore's high cost of doing business was less of a factor when paired with its winning triumvurate of efficient government administration, high quality facilities and manpower advantages from both local and expat's lured to Singapore in the foreign talent scheme, and high levels of transparancy. Add to that the reduced competitiveness from neighbours dealt a significant blow by the Asian economic crisis and it's political and social fallout, and Singapore, along with China, were really the only Asian business economies to forge ahead in recent years. However, cost is now becoming more of a concern to the global investors who sensibly chose Singapore as an outsourcing, investment and knowledge economy base in that time. Singapore Deputy PM Lee Hsien Loong (also known as BG Lee), son of founding father Lee Kuan Yew and one of the smartest businessmen in the nation state, cited problems in the Philippines and Indonesia in particular as reducing the attractiveness of Singapore while it is seen as a "South East Asian" center. On the other hand Hong Kong has the significant advantage of a conduit to North-East Asia and China. "We have to overcome this because we are in SouthEast Asia. We must show that we are different".. said BG Lee in an interview with the Singapore Business Times. Of course, Singapore as you will see we have said for several years if you visit the archives, has been quietly and efficiently distancing (or as the marketers would say - repositioning) themselves away from South East Asia for some time. Malaysia, (and now Thailand if Thaksin has his way), opted to insulate their own economies. Mahathir as a medical doctor effectively put Malaysia into intensive care in order to escape the ravages of the free market, enabling Malaysia to continue to comfort the insulated patient with familiar crony bailouts and soothing diagnosis of the a villainous global conspiracy. Indonesia, Thailand and the Philippines had far too much to worry about before even thinking about courting foreign investment again, and Burma/Myanmar, Vietnam, Laos and Cambodia were going nowhere fast, even going back to old ways and becoming more insular. Singapore's support of ASEAN was and remains half hearted, though they may not admit it officially, preferring to pursue trade agreements individually and refusing to back up some of the nationalist nonsense emanating from the North and South. Singapore's press (and sometimes its leadership) continues to break the informal conspiracy of silence vow (the principle of non-interference) that at the same time strengthens ASEAN internally but weakens it externally with regular commentary on the political and social failings of others, particularly Malaysia. For ASEAN and it's greatest proponents, Singapore's recalcitrance in playing the Asian Values Game in this instance is both confusing and disabling. Singapore, though representing the smallest population with the exception of oil-rich Brunei, is a long way ahead of other South East Asian countries in terms of GDP and GNP pre capita, perceptions of government and private sector management expertise, and political transparancy and stability. As we said several years back, Singapore quietly has got down to business in the age of globalization, leaving others to take the West-baiting headline grabs - and for little return other than entrenching their own power in their own nation states. ...And it is now a decade since Kenichi Ohmae so correctly predicted the decline of the power of the nation state. A Singapore that rests on its laurels, especially in the coming global slowdown, will quickly succumb to it's greatest strategic threats - from it's geographic position as a rich, mainly Chinese island state squished in between a great Malay archipelago, and it's inability to compete on business costs if ever other ASEAN countries begin to approximate it's private sector management expertise and competence. Lee Hsien Loong is ready to become Prime Minister. While current PM Goh (speak softly but carry a big stick) Chok Tong has indicated he is quite comfortable in retaining the PM's mantle for a few more (well - eight actually) years, the BG is sensibly doing what he can even if he's not in the throne - pragmatically pressing ahead with an already established strategy to create a special place for Singapore in a globalized world. For most of the rest of ASEAN, where the existing legislative and judicial processes serve only to entrench established ways to the extent that people power becomes the only recourse of the masses, there is a lesson in Singapore's approach as well. The "Search for Difference" was one of the key factors identified by recent research conducted by our parent company's focus group research on Asian tourism. Identifying the unique characteristics of your product or service, then building and publicizing them competently, is the key to success in the globalized world, even if your product is a whole country.
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© Asian Business Strategy & Street Intelligence Ezine 2000
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