The Case of Singapore: Building on Economic Success in a Changing World |

The Case of Singapore: Building on Economic Success in a Changing World

20110923_Lord-Mandelson_04_170x200On September 21st 2011, the Lee Kuan Yew School of Public Policy hosted a public lecture on “The Case of Singapore: Building on Economic Success in a Changing World” by former British cabinet minister Peter Mandelson, who was in Singapore as the 32nd Lee Kuan Yew Exchange Fellow.

Lord Mandelson lauded Singapore as a model for the rest of the world in its achievement of the right balance between market competition, individual enterprise and collective investment. He said Singapore’s pragmatic response to globalization and its ability to turn its constraints in the post-independence era into opportunities created a “new normal”, in politics which could be applied universally.

Though Singapore was not unique in its staunch belief in open trade, it distinguished itself by its “pragmatic solutions to weaknesses in laissez-faire models”, Mandelson said, citing the government’s implementation of the Central Provident Fund, which makes saving for retirement mandatory, as an effective safety net that did not lumber the state in costly welfarism.

One of Singapore’s success factors, according to Mandelson, is its highly open and globally integrated economy and general disdain for protectionism. But openness is not a pre-requisite for growth or an end in itself, so governments have to put in place an environment conducive to making a liberalised market work well. In this regard, Singapore is well supported by an excellent education system, good infrastructure, strong investment in research and development and the rule of law.

Secondly, the Singapore government has rightly, argues Mandelson, “stopped at the edge of the market” and stepped in only in situations where markets would under-invest if left to their own devices, in order to allow space for innovation and dynamism to flourish.

Thirdly, Singapore’s emphasis on transparency and accountability has helped it cope with the ebbs and flows of globalisation. Mandelson said that a society’s social contract had to be openly debated in a way that kept up with the expectations of its people. If anything, the “activist state” under the new normal had to be even more accountable to its populace, even if this was at times at the expense of efficiency.

Mandelson spoke candidly about his party’s loss of power during the UK general elections last year, saying that the experience taught politicians to be mindful of the need to continually foster an emotional bond with their electorate. Reflecting on New Labour’s loss after 13 years in government, he said: “As a party, we had begun to drift, to misplace our New Labour identity … We lost what can best be described as our emotional connection with voters.”

As the man credited for the Labour Party’s metamorphosis into New Labour, Mandelson reminded his audience that “policies are rational but politics is emotional”. He drew parallels between his party and Singapore’s incumbent People’s Action Party (PAP), which saw its share of vote slip to its lowest level since independence during the general election in May. He said: “The trick for any party long in power is to recognise that with power comes great responsibility. It must find ways to give away more power to the people, rather than take more power into itself.” The way forward then for the PAP was to ensure it did not become complacent by becoming its own chief critic, he said, noting that the journey ahead was likely to become bumpier with the growing problem of immigration and an ageing population.

The talk ended with memorable words from the veteran politico to a question posed by LKY School Dean Kishore Mahbubani on what advice he would give to politicians: “ Under-promise and over-deliver”, or the government “will face an excess of demand of expectations when in fact there is a limited supply of actions it can take.”

 

By Benjamin Tan, editor of Global-is-Asian, the quarterly magazine of the LKY School.

 

Multimedia: Webcast |

 
Synopsis:

Singapore's growth model is in many respects unique, and it is important to ask where it fits in the wider resurgence of Asia and what lessons it might have for the rest of Asia and the wider global economy. In the wake of the western banking crisis, the key challenge for both Asia and the West lies in building economies in which the potential and limit of both states and markets are better understood. Rather than seeking a single new post-crisis 'model', policymakers need to start from the political assumption that no two societies or economies are identical and that growth in a global economy is more likely to involve a diversity of approaches. Part of challenge all societies face lies in reassessing and determining what is necessary in all times and all places for economic success in a global economy and what can and should be regarded as part of the menu of policy choices that societies must choose for themselves.

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Speaker(s):

Rt Hon Lord Mandelson, Lee Kuan Yew Exchange Fellow; Member of the House of Lords; Chairman of Global Counsel; and Senior Adviser to Lazard

Date:
Wednesday, 21 September 2011
Time:
5.15 p.m. - 6.30 p.m.
Venue:

Level 3, Lecture Theatre
Block B, Faculty of Law, NUS Bukit Timah Campus
469G Bukit Timah Road
Singapore 259776

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