When Gregory Wade left Research In Motion’s Asia Pacific headquarters here last fall, the logical thing to do might have been to pack up his family and head home to his native shore of British Columbia.
Instead, the eight-year expat joined an equity firm and continued preaching the economic miracle of Singapore, coaching Canadian firms looking to set up shop in the region as a vice-president for The Canadian Chamber of Commerce in Singapore.
“You will sense a vibe of growth, of energy, a sense of entrepreneurship and the desire and interest to create new and innovative products and services,” said Mr. Wade, who is now managing director of mobility at InflexionPoint Acquisition Corp. “I didn’t get that same vibe in Canada, regardless of locale.”
For a city-state with no resources, limited land and a small population, creating the explosive growth and development of the past half-century has meant running it like a corporation – using highly trained, highly paid leaders, inviting the world’s best and brightest to its work force with an open-door policy, and with a near-zero tolerance for dissent among the masses.
The result is a planned, modern economy with efficient public services, an educated population and a per-capita share of gross domestic product of more than $60,000 (U.S.), the highest in Southeast Asia. Singapore ranks No. 2 on the World Economic Forum’s global competitiveness rankings.
Today, as Singapore nears the 50th anniversary of its independence, the original economic miracle is slowing. Hit hard by the Asian financial crisis, the dot-com bust, the outbreak of SARS in 2003 and then global recession in 2008, the city-state is at an economic turning point.
In its early days of enticing multinational firms, huge tax breaks, low operating costs and a great quality of life in an English-speaking tropical setting were the calling card. Today, a more sophisticated approach is needed, economists say, with a heavy focus on research and development, education and head-hunting the best talent from at home and abroad.
“Singapore’s economic strength is so vulnerable. When Europe stops, when America goes into recession, when Japan goes into recession and China slows down, there is nothing left for Singapore because we are so small, our economy is all exports,” said Tan Khee Giap, an economist from the National University of Singapore and co-director of the Asia Competitiveness Institute. “All we can do is diversify.”
At the core of Singapore’s economic policies is the country’s massive Research, Innovation and Enterprise Council, chaired by the Prime Minister himself and given an undisclosed share of the country’s annual budget to reach out to the four corners of the globe for investment.
Operating through three government ministries, four agencies and a multitude of smaller schools and research institutes, it is a massive multibillion-dollar effort to keep Singapore at the cutting edge of technology and research, and draws some of the world’s biggest corporations to its shores.
One of its lead agencies is the Economic Development Board, which pursues business opportunities around the globe from a gleaming downtown headquarters with a stunning view of Singapore’s skyline. The board manages 21 offices in 12 countries, including six in the United States, developing investments and industries that together contribute about 40 per cent of Singapore’s GDP.
“Our openness to investments started really in the 1960s because we found that the multinational corporations brought with them their own distribution networks and their own market. So it opened us to the rest of the world in terms of their exports,” said Damian Chan, the board’s international director for Americas, who said the focus has shifted over the years from lower-tech manufacturing to higher-tech, such as semiconductors and electronics, and now to more innovation and knowledge-based industries, including biomedical sciences and clean technology.
“The key thing now actually propelling the Singapore economy forward, and we will see that continue over the next two, three, maybe even more decades, would be the Asian growth story.”