When Myanmar’s reforming President Thein Sein visited Singapore
in January, officials there offered lessons on how to modernize and
attract foreign investment. Singapore’s eagerness to court
Myanmar’s ruling generals has been a diplomatic feature of the
international community’s two decades of trying to crack open the
reclusive country.
Now that Asia’s “next economic frontier” has started to open up,
Singapore – where Myanmar’s senior generals bank and seek.
hospital treatment – is keen to offer itself as a dazzling example
of how to become a first-world economy within a couple of
generations.
It’s a siren call that should be resisted, said Rodney King, the
Australian author of the controversial book Singapore: Myth and
Reality.
“Singapore is not a good development model and not one a
developing country should follow. Singapore has basically conned
the world about its nation-building achievement,” said King. “It is
frightening that they should regard Singapore as a good model to
follow.”
Years of robust growth in Singapore were driven initially by
waves of foreign capital into the city-state and more recently by
the import of foreign workers, who now make up one-third of the
population. The government’s jealous husbanding of much of the
economy, meanwhile, has rendered impotent much of the nation’s
faculty for creative business.
“Its entrepreneurial, innovative capacity is quite small. It’s
got a very small local private sector, unlike say South Korea and
Taiwan, where there are vigorous entrepreneurial cultures. In
Singapore, they don’t really have that,” said King, who spent many
years working in the island-state.
It is unlikely that Singapore says this in its diplomatic and
commercial outreach to Myanmar. Ashfaqur Rahman, chairman of the
Center for Foreign Affairs Studies in Bangladesh, had no doubt what
Singapore hopes for when he noted how it shunned the previous
Western policy of making a pariah of the ruling junta.
“The basis of this strategy was to gain from a relationship
which was essentially economic. Singapore invested heavily in
Myanmar and traded with her. It even pushed other [Association of
Southeast Asian Nations] members to allow Myanmar to join the
regional organization.”
Myanmar citizens, who for decades have been mired in corrupt
economic lethargy, are no doubt dazzled by Singapore’s success in
turning a former modest British trading hub into a confident modern
nation with a per capita income among the highest in the world.
Remarkably an island state with just 1% of Southeast Asia’s
population still attracts nearly half of its foreign direct
investment. Yet this success has come “at considerable costs in
terms of independent development, human rights, freedom, and
workers rights”, according to an academic paper published last
year.
That part of the economy not in foreign hands is dominated by
government-controlled institutions run by the local nomenklatura.
Keeping an every present watch is the People’s Action Party (PAP),
which has run virtually a one-party state since independence.
“One of the key features of the Singapore model is that the
commanding heights of the economy are controlled by the state –
directly or indirectly. Burma [Myanmar] had all its state
enterprises taken over in 1962 by [the late general] Ne Win, which
has just dragged the economy into the ground,” said King.
“If they were going to follow the Singapore model they would be
just repeating the mistakes that they have already made. Singapore
crushes individual enterprise but [Myanmar] is going to need all
the enterprise it can possibly muster to get over 50 years of
chronic warfare and political repression.”
King’s criticism might have less sting given Singapore’s wealth
were it not also echoed by an increasing number of complaints
rising from within the city-state. Indeed, many now question
whether the “Singapore model” is still valid. In last year’s
general election the ruling party won its lowest share of the vote
since independence.
Productivity gains have been notoriously weak for decades,
hardly what the casual observer might imagine from a country
regularly ranked as one of the most competitive.
The American economist Paul Krugman infuriated Singapore’s
founding father Lee Kuan Yew 20 years ago by claiming Singapore’s
growth could be explained by more of everything – capital and labor
– except efficiency.
Ever since the launch of the “Teamy the Productivity Bee”
campaign three decades ago, the government mantra has been to focus
on generating greater added value. Despite myriad training
initiatives, worker productivity has barely grown by 1% a year in
the new millennium.
Growth has been sustained by an inflow of foreigners that has
doubled the island’s population since 1980, with foreigners and
non-Singapore born citizens now representing three-fifths of the
population. “We’ve grown in the last five years by just importing
labor,” said Lee Kuan Yew himself in 2010.
The country arguably hasn’t maximized that influx. “They
imported all these scientists and technicians from all over the
world but the outcome has been fairly modest. These people have
found working in a bureaucratic structure quite stifling,” said
King. The authorities “spend tons of money on resources but the
ambience isn’t there really. They seem to be able to attract
talent, but when they get them they can’t operate the way that they
want.”
Equality gap
Singapore shone in the headlines again recently when one of
Facebook’s founders, Eduardo Saverin, was revealed to have given up
his United States passport in favor of residency in Singapore to
“invest like crazy.”
Saverin joins an elite of super-rich floating on top of an
ordinary public, many of whom struggle to make ends meet in an
increasingly expensive city. The bottom half of the population
experienced either falling real income, or no gain in income, over
most of the last decade.
High inequality levels have combined with falling social
mobility, reinforcing the grip of the privileged upper class to the
point where even the government recognizes this threatens the
social compact.
One of the city-state’s most respected economists, Professor Lim
Chong Yah, said in April that the city’s Gini coefficient (a
measure of equality) of 0.47 was approaching the “danger level” of
0.5 when typically income inequality starts to tear at a country’s
social fabric. He has advocated a “shock” therapy of pay rises for
workers and tax penalties for the rich.
King estimates one-fifth of the population lives in poverty as
measured by Organization for Economic Cooperation and Development
standards. “They have been able to attracts lots of foreign direct
investment … at the cost of Singaporean living standards.”
Singapore may now have passed some sort of inflexion point. The
first two generations of PAP leaders have faded from the scene –
aside of course from the Senior Lee himself – and the younger
leaders do not seem to hold the power to cow the population as in
the past.
“This has been a country of frightened, intimidated people. In
the 1950s and ’60s, Singaporeans were feisty, gung-ho people but
Lee and co killed their spirit,” said King.
This past timidity in the face of authority permitted a series
of policy mistakes followed by awkward U-turns. One notable quirk
came in 1970 when Lee discouraged big families after deciding the
population was too high, only years later changing his mind to beg
(rather comically) Singaporeans to breed more freely.
Over the years, careful observers have pointed out that
Singapore’s “success” owed much to being a small, compact island
that made political and social control relatively easy, so enabling
it to experiment with robust but effective national development
strategies.
By contrast, Myanmar is an infinitely more complicated jigsaw of
ethnic, geographic, economic and historic problems in a space that
is one-thousand times bigger. “Vast, sprawling countries like
Indonesia, (Myanmar) and Thailand … would find such strategies a
great deal harder to implement,” said King.
To be sure, Singapore’s founding myth as a mosquito-infested
swamp of palm plantations and kampong dwellers in 1965 is a
compelling one for underdeveloped countries like Myanmar eager to
learn the secrets of rapid enrichment.
Nothing could be further from the truth, however. In 1965,
Singapore was one of the most developed cities in Asia in terms of
industrial development, living standards and literacy of the
population, argues King.
“Singapore’s nation-building success, such as it is, was based
on a set of highly favorable circumstances that are unlikely to be
found elsewhere,” he said.
Singapore surely must be praised for many things, not least its
relatively clean dealings in a region benighted by corruption. But,
if King’s assessment is correct, then Myanmar might be wise to
examine carefully the advice from an authoritarian state of growing
inequality struggling with low productivity and rising social
unhappiness.
Source:
http://www.inewstoday.net/2012/singapore-is-not-good-model-for-developing-country/
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