Economic overview
Singapore is a remarkable model of economic development. From independence in 1965, it has achieved almost uninterrupted growth of at least 8% per annum for over three decades. By the 1990s, Singapore had GDP per capita levels similar to many OECD countries, and it was acknowledged to be one of Asia’s “tigers”.
Centralised decision-making and planning have been key to Singapore's development. The government has targeted particular industries for development (often over a long time frame) by putting in place world-class infrastructure and offering generous tax concessions. It has also established Government Linked Companies (GLCs) - like Keppel Corporation, SembCorp Industries and Singapore Airlines - with the intention that they become home-grown champions in strategic areas of the economy.
Singapore's economy relies on manufacturing, financial and business services, and commerce. Within the manufacturing sector, the dominant industry is electronics (electronics accounts for 29% of manufacturing output, and Singapore is a manufacturing base for several of the world's leading electronics multinationals. Singapore also serves as a hub for South East Asia across an extensive range of financial and business services. In 1997, the government announced its intention to establish Singapore as the pre-eminent financial hub for the wider region and it has introduced significant measures to liberalise financial services. Singapore's historic role as an entrepot and trans-shipment centre also continues to this day. Both its port and airport are world class, regularly winning industry awards and offering superior connectivity for shipping and the airlines.
Until recently, Singapore had experienced few periods of economic difficulty. But it was hit hard in 2001 by a downturn in its key global markets and a collapse in demand for electronics goods. As a result, Singapore experienced in 2001 its worst recession since independence: GDP fell 2.4% after growing almost 10% in 2000, and exports fell by almost 15%. Although its economy grew again by 2.2% in 2002 (largely as a result of increased exports from the biosciences sector), Singapore was hit hard again the following year by SARS (Severe Acute Respiratory Syndrome). The Singapore government handled the outbreak better than most, but the economic fallout was significant, particularly in the retail, tourism and consumer-services sectors (at its worst, visitor arrivals fell by more than half, retail sales plummeted by more than 80%, and many leading hotels had occupancy rates of less than 20%).
Nevertheless, Singapore’s economy remains fundamentally strong and has rebounded with confidence, albeit at a slower pace than previously experienced. GDP grew in 2006 by 7.9%, followed by a very respectable growth of 7.7% in 2007. However, Singapore does still face a challenge in adapting its centralised economic system. The government has recognised that many of the established policies need to be changed, and has embarked on a process of creative construction. This involves an intensification of measures to liberalise and deregulate the economy, and the active promotion of entrepreneurship.
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Opportunities
GDP: US $117.9billion
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Top UK Imports from Singapore: January - December 2007
(£ Thousands):
01: Organic chemicals - 2,058,790
02: Office machines and ADP equipment - 512,934
03: Power generating machinery and equipment - 434,507
04: Electrical machinery, apparatus and appliances, nes and electrical parts thereof - 152,018
05: Miscellaneous manufactured article nes - 130,431
06: Telecommunications and sound recording and reproducing apparatus - 124,671
07: Petroleum, petroleum products and related materials - 93,722
08: Articles of apparel and clothing accessories - 75,025
09: Professional, scientific and control instruments (and apparatus nes) - 72,275
10: Medicinal and pharmaceutical products - 51,950
Top UK Exports To Singapore: January - December 2007
(£ Thousands):
01: Power generating machinery and equipment - 663,696
02: Electrical machinery, apparatus and appliances, nes and electrical parts thereof - 198,445
03: Beverages - 176,693
04: Non-ferrous metals - 152,382
05 General industrial machinery and equipment, nes and machine parts nes - 137,083
06: Manufactures of metal nes - 126,035
07: Miscellaneous manufactured articles, nes - 118,958
08: Professional, scientific and control instruments (and apparatus nes) - 114,340
09: Other transport equipment - 75,573
10: Medicinal and pharmaceutical products - 74,507
Export partners: Malaysia 15.2%, US 13%, Hong Kong 9.8%, China 8.6%, Japan 6.4%, Taiwan 4.6%, Thailand 4.3%, South Korea 4.1%
Import Partners: Malaysia 15.3%, US 12.7%, Japan 11.7%, China 9.9%, Taiwan 5.7%, South Korea 4.3%, Thailand 4.1%
UK relations and investment
Singapore is a key market for the UK. It is one of the UK’s largest export markets outside of Europe. Our exports of goods to Singapore amounted to over £2.4 billion in 2007, more than to any other country in the region. Exports of services in 2007 amounted to over £3 billion. Over seven hundred British companies are represented here and more than 22,000 British nationals live here. But the UK is also a key market for Singapore. We import more from Singapore than from any other South-East Asian country. In 2007, our imports amounted to more than £4.1 billion. The UK is also Singapore’s second largest trading partner from outside the Asia Pacific region. And we are leading investors in each other's economies. The UK is the largest investor in Singapore. The cumulative stock of UK investment in Singapore amounted to £17 billion in 2005. The UK is also the largest recipient of Singaporean investment in the European Union. Singaporean foreign direct investment in the UK amounted to £2.5 billion in 2005. Around two-thirds of all Singaporean investment into the EU comes to the UK.
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International Relations Within the Southeast Asian community the ASEAN is an integral mediator between the countries and demands the cooperation of all the countries involved. Singapore was one of the founding members in 1967 and endeavours to maintain positive connections and relations with members and non-members of ASEAN. Singapore was extremely fortunate to not be affected by the Tsunami that hit the region in 2004, as the country is so close to the epicentre of the earthquake and subsequent Indian Ocean Tsunami. The country was quick to respond and show support to its neighbours who had suffered considerably, in particular Indonesia. Singapore is one of the five ASEAN countries who are currently participating in the EU/ASEAN Aceh Monitoring Mission. Globally Singapore is actively involved with a variety of international concerns and organisations, including the UN, the Commonwealth, APEC, the WTO and the NAM. |
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Human Rights
Singapore has an active internal security network and military force put in place to act against national security threats. The government has also frequently used its security legislation to restrict and control a wide range of activity within the country. The Internal Security Department (ISD) is responsible for carrying out the procedures outlined by the Internal Security Act (ISA); this includes enforcing the detention of citizens without trial. Although there are problems in some areas of Singapore’s Human Rights activities the Government usually respects the Human Rights of its country’s citizens. The areas where there rise occasional concerns in the government’s human rights activities are various. The government still maintains the power to detain people and restrict their travel, freedom of speech and right to associate freely. There is also some legal discrimination against women, but the government is making active attempts to counter social discrimination against minorities and women. Human Trafficking is still a problem within the country.
Political history
Singapore is a republic within the Commonwealth. It has an elected President. The People’s Action Party (PAP) has governed Singapore since internal self-government in 1959. Lee Kuan Yew (LKY) stood down as Prime Minister in 1990, to be succeeded by Goh Chok Tong, who stood down himself in August 2004, to be succeeded by the current Prime Minister, Lee Hsien Loong, LKY's son. LKY is, however, still a serving member of the Cabinet and continues to exert influence from his position as “Minister Mentor” in the Prime Minister’s office (Goh Chok Tong continues to serve in the Cabinet as the "Senior Minister"). Of the 94 MPs in the unicameral Parliament, the PAP holds 82 of 84 elected seats and 1 non-constituency and nine nominated MPs make up the remainder.
Timeline
1819 Sir Stamford Raffles of British East India Company establishes a trading post on Singapore
1826 Singapore, Malacca and Penang become British colony of the Straits Settlements
1867 Settlement Straits become crown colony of British Empire
1869 The opening of the Suez Canal sees trade increase
1941 In World War II Japan bombs Singapore and in 1942 Singapore falls to Japan and renames it Syonan
1945 Japan defeated and Singapore comes under British military administration
1946 Singapore becomes separate crown colony
1959 Self-government attained with Lee Kuan Yew as prime minister
1963 Singapore joins the Federation of Malaya along with Sabah and Sarawak to form Malaysia
1965 Singapore pulls out of the Federation of Malaysia, at Malaysia’s invitation due to political and ethnic tensions. The territory becomes independent and joins the United Nations (UN)
1967 Singapore is one of the founding members of Association of Southeast Asian Nations (ASEAN)
1971 Last British military forces withdraw from the country
1984 Two opposition MPs are elected into parliament for the first time
1990 Goh Chok Tong becomes prime minister as Lee Kuan Yew stands down after 31 years; he still remains an influential senior minister.
1993 Ong Teng Cheong becomes first directly elected president
1997 Asian financial crisis
1998 Singapore falls into recession for the first time in 13 years due to the Asian financial crisis’ effects
1999 S R Nathan is declared as only candidate eligible to run for president and so becomes president without election
2001 General election landslide for PAP and the Party secure all but two of the 84 seats.
2002 January – Japan, Singapore sign free trade agreement
2003 SARS virus outbreak is declared by Prime Minister Goh Chok Tong as the worst crisis country has faced
2003 Singapore becomes first Asian nation to sign free trade deal with US
2004 Lee Hsien Loong, who the eldest son of former Prime Minister Lee Kuan Yew, is sworn in as Prime Minister
2005 President S R Nathan begins a second six year term
2005 Australia man is executed for drug smuggling, despite high level appeals. This is condemned by Australia’s attorney general as barbaric
2006 Lee Hsien Loong’s ruling People’s Action Party wins general elections which is the viewed by most people as the first real test of the prime ministers popularity
