If the anthem Majulah Singapura (Onward, Singapore) was intended by the nation’s founding fathers as a positive affirmation, it must be working. Singapore celebrates its 53rd birthday today as a vibrant and flourishing city-state.
In his National Day address, Singapore Prime Minister Lee Hsien Loong said Singaporeans enjoy a good quality of life, better than many others in the world. “Our economy continues to grow steadily, around three to 3.5 percent in recent years, productivity is improving and incomes are rising,” he said.
In 2017, Singapore was ranked as the world’s top maritime capital by Oslo-based consultancy firm, Menon Economics, beating Hamburg and Oslo. It is still Southeast Asia’s top port of call despite competition from Malaysia’s Port Klang and Tanjung Pelepas.
Singapore is also the top air transport hub. Its Changi Airport processed a record 62.2 million passengers in 2017 and airfreight grew 7.9 percent to 2.13 million tonnes, beating back growing competition from Bangkok’s Suvarnabhumi Airport and Malaysia’s Kuala Lumpur International Airport.
As a financial centre, Singapore is fourth-placed behind London, New York and Hong Kong with total assets under management worth SGD2.7 trillion (US$1.9 trillion) in 2016.
Its 2017 gross domestic product (GDP) was SGD447 billion (US$328 billion). The economy grew 4.3 percent year-on-year in 1Q18 and 3.8 percent in 2Q18.
Source: Singapore Department of Statistics
In June, Singapore gained international prestige when it hosted a summit meeting between United States (US) President Donald Trump and North Korea’s Chairman, Kim Jong-un. Taking over the Chair of ASEAN this year, Singapore’s global stature has been further burnished.
Nonetheless, the Prime Minister warned of clouds on the horizon.
“The summit eased Korean tensions but there are many challenges still to be overcome before denuclearisation and peace are achieved on the Korean peninsula,” he said.
The latest challenge is the trade war between the US and China which affects international trade, investment and business confidence. “Singapore’s own growth and prosperity will be affected, too.
“Trade conflicts also erode trust between major powers and hinder their cooperation on other important issues. Hence, regional and international security are at risk,” he added.
Manu Bhaskaran, an economist and partner at Centennial Asia Advisors Pte Ltd, noted that Singapore’s GDP growth rate has been gradually declining since independence. “To remain an attractive and vibrant economic hub, Singapore’s economy needs to grow around two to three percent a year. The challenge is finding where this growth will come from,” he wrote in an article published by the Lowy Institute.
Singapore faces slower growth as its population ages, the workforce stagnates and productivity weakens. Fertility rates have also been falling, from 5.76 in 1960 to 1.20 in 2017. To compound this slowdown in workforce growth, Singapore’s labour productivity growth has also fallen sharply in recent years, Bhaskaran added.
Prime Minister Lee said the Singapore government has been reviewing major education, healthcare and housing policies in recent years to improve Singaporeans’ lives, strengthen social safety nets and build a cohesive nation.
He highlighted Kampung Admiralty as an example of an integrated housing estate designed for senior citizens. The flats have features like grab bars and non-slip tiles. Amenities such as a supermarket, medical centre, community garden, childcare centre and hawker centre are co-located here to create a family-based community. “Kampung Admiralty is a model for future public housing and meets a need as our society ages,” he said.
Recent events, such as Malaysia’s general elections and a major data breach, are giving Singapore new concerns.
The continuous 61-year rule of Malaysia’s National Front (Barisan Nasional) coalition ended with victory for the opposition Alliance of Hope (Pakatan Harapan) in the country’s recent general election. It swept Mahathir Mohamad back to power as Malaysia’s seventh Prime Minister.
Mahathir formerly led the National Front and was the fourth Prime Minister of Malaysia for 22 years. During this time, he occasionally sparred with Singapore over issues such as the price of raw water Malaysia sells to Singapore and the ownership of railway land in Singapore.
When Singapore left Malaysia in 1965, the latter’s national railway company, Keretapi Tanah Melayu (KTM), retained ownership of the railway line from Woodlands in Singapore’s northern tip to Tanjong Pagar railway station in the south. This bisected the island state and hampered Singapore’s infrastructure development.
Malaysia’s previous Prime Minister Najib Razak returned the land to Singapore on 30 June 2011. The Tanjong Pagar station was closed and the terminal relocated to Woodlands. Najib’s government fostered close ties with Singapore and inked a deal to construct a high-speed rail (HSR) line connecting both countries’ capitals.
Shortly after coming into power, Mahathir announced the cancellation of the HSR and hinted at the possibility of raising raw water prices which immediately sparked off concerns among Singapore’s leaders.
The Alliance of Hope’s victory has inspired Singapore’s opposition. Seven parties – the Singapore Democratic Party, National Solidarity Party, People’s Power Party, Democratic Progressive Party, Reform Party, Singaporeans First and to-be-registered People’s Voice – announced plans to form a coalition this month. However, the two most successful opposition parties, the Workers’ Party and the Singapore People’s Party are not involved.
Singapore’s recent data breach incident, where 1.5 million patients’ records – including the Prime Minister’s – were exfiltrated from SingHealth, the country’s largest healthcare group, tarnished its image a little.
On the bright side, the breach will make Singapore even more diligent with cybersecurity as it moves onward to becoming a “Smart Nation.”