Dr Goh Keng Swee’s four reasons why Singapore succeeded

There are four reasons which enabled Singapore throughout her history as a British colony, and today as an independent republic, to survive and even prosper in the face of apparently insurmountable difficulties.

First, there is the well-known fact of a superb central geographical location with a natural harbor swept by currents flowing between the South China Sea and the Straits of Malacca.

The second reason must be ascribed … to Sir Stamford Raffles’ great vision of the island growing into a great emporium founded on the Victorian belief in the virtues of free trade. Successive colonial governors zealously nurtured the port, maintained lean and efficient administrators, and allowed merchants and bankers full scope for the exercise of their talents. In the modern idiom, the Victorians who governed Singapore established and maintained an infrastructure at minimum cost with maximum efficiency.

The third reason derives from the second condition, the nurturing of the free enterprise system. In the absence of monopolies and privileged business interests, keen and free competition ensured efficient business.

Finally, what made Singapore grow as a trading centre despite mercantilist policies of neighbours was that the economics of the business did not add up to a zero sum game. This happy result emerges from the continuous and rapid economic development of the countries in Southeast Asia under British and Dutch colonial administrations.

For well over a hundred years Singapore learnt to adapt her economy to changing circumstances. This ability to adapt which was won in the hard school of experience remains an asset which the government of independent Singapore decided to retain. It might have been politically expedient to rid ourselves of institutions and practices that bore the taint of colonial associations. Had we done so, we would have thrown away a priceless advantage.

[Goh Keng Swee, The Practice of Economic Growth, Chapter 1: Why Singapore succeeds, pages 6-7]

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