Can Boris Turn Britain into a Singapore?

Britain is out of Europe but has landed deals with Japan and Canada. Boris believes now that the trade deal with EU is concluded, the U.K. can take advantage of its “new found freedoms”.

One way Mr. Johnson could take inspiration from Singapore is to introduce a low tax regime with fewer regulations. That means the U.K. becomes a low-cost competitor, which Europe may not welcome readily.

Chris J Ratcliffe / Getty Images

The Singapore economy is mainly driven by exports in electronics manufacturing and machinery, financial services, tourism and the air and sea links – second largest port in the world by TEUs.

The manufacturing sector contributes 20-25% of the country’s GDP. Key clusters include electronics, biomedical sciences, logistics and transport engineering.

Close behind manufacturing, is its financial services industry. It has a pro-business environment and political stability. Other sectors that are growing include medical technology, aerospace engineering, clean energy, healthcare and content development.

Singapore has no significant natural resources. Its true natural resource is its people – local and foreign companies have a pool of educated workforce willing to work with little friction over labour matters. Then it has a growing middle class consumer market to be tapped.

Infrastructure for a small island is well developed with paved roads, rail and other modes of transport. All of these including the airport and seaport offer efficient, safe and punctual service.

The Government in power has been led solely by the PAP since independence. The opposition parties are not able to mount any significant challenge because the average Singaporean is taken care of with affordable housing and employment.

The Singapore Government has zero foreign debt since 1995. As for domestic debt, the total outstanding was S$496 billion in 2017. This may have grown with the recent pandemic.

Singapore’s success can be attributed to five factors:

·       Pragmatic leadership of the late Lee Kuan Yew and his successors;

·       Effective public bureaucracy;

·       Effective control of corruption;

·       Heavy investment in education and compensation to secure the “best and brightest”; and

·       Learning from other countries on best practices.

That was the thesis of Jon S.T.Quah’s article in Public Administration and Policy: An Asia-Pacific Journal (2 July 2018).

So, does Britain have the ingredients? The short answer is No. Why? It does not have a visionary leader that remains in power for 40 odd years; Britain is not a “one” party democracy; its bureaucracy is not as efficient – but extremely well educated – watch “Yes Minister”.

Britain is low in corruption but has not invested heavily in education for the “best and brightest” to rise; it still has a class system and an “old boy” network that values Oxon; Britain is not as nimble in project implementation because of its established local or EU practices; and the British value human rights, unions and negotiated wage structures.

Britain can try to emulate Singapore but it will not be another Singapore. The “muddle through” principle is too ingrained for change.

Good luck, Boris!

Reference:

John Varga, EU's worst fears realised: Boris Johnson plans to turn UK into 'Singapore of Europe', Jan 18, 2021, Daily Express