__MAIN_TEXT__

Page 64

BY I A N LIM Ian Lim is a current exchange student at the Wharton School, University of Pennsylvania.

SINGAPORE:

The Merlion is an imaginary creature with the head of a lion and the body of a Àsh, and is used as a mascot of Singapore.

WORLD CLASS BUSINESS HUB I magine an island nation in Southeast

tariffs and quotas as a knee-jerk solution to

Asia spanning only seven hundred square

create and protect domestic companies. Instead,

kilometers,

natural

they embraced the virtues of international free

resources– no agriculture, minerals, or water

trade, creating an export-oriented industrial

supply.

It was a fishing village in the 18th

policy that now features 50 double taxation

century, colonized by the British in the 19th

avoidance treaties and 18 FTAs with 24 bilateral

century, and declared independence in 1965.

partners. Net exports form 21.1% of GDP.

with

virtually

no

You might not think much of it, especially in

An aggressive industrialization policy was

the shadow of growing economic behemoths

implemented to move up the value chain. Foreign

like China and India.

multinationals were incentivized to set up offices

Yet this tiny nation - Singapore - has

in Singapore, bringing foreign expertise, training,

achieved world class stature, ranking among

and employment to Singapore’s young economy.

the top ten most desirable locations to live and

iIcome and corporate taxes are among the world’s

work. It boasts political stability, no corruption,

lowest, below 20%. The Jurong marshland area

and vibrant industries in finance, manufacturing,

was cleared and designated an industrial hub

and pharmaceuticals.

for these new companies. Competition from

How did Singapore transform from an

Chinese low-cost manufacturing and Indian

economic backwater to the world’s fourth most

low-cost service industries forced Singapore’s

affluent society? How did it become a global

government to constantly innovate and attract

research and development hub with a previously

advanced industries, including financial services,

uneducated workforce? What lessons are we

life sciences, and pharmaceuticals.

taught from this experiment in state building?

The Singapore Story – How to Build a Nation 1. Visionary, competent, and pragmatic political leadership

64

111210 hq.indd 64

2. Geographical location is Singapore’s greatest “natural” asset It is said that “geography is the mother of history.” Singapore capitalizes on its strategic

In 1963 Singapore tried to merge with the

location at the Straits of Malacca, arguably the

Malaya. Political differences in 1965 would have

busiest waterway in the world, and key link

the deal fall apart; it was a blessing in disguise.

between Asia and Europe. 50,000 vessels,

With its small population and domestic

a quarter of the world’s trade, pass through

market, Singapore could not survive as a mere

here each year, making Singapore the busiest

transshipment hub. Yet the government avoided

transshipment port in the world.

I N T E R N AT I O N A L B U S I N E S S R E V I E W

FA L L 2 0 1 0

11/27/2010 3:13:24 PM

Profile for Daniel Hellwig

International Business Review - Fall 2015  

Fall edition of the IBR magazine at the Wharton School.

International Business Review - Fall 2015  

Fall edition of the IBR magazine at the Wharton School.

Advertisement