Singapore’s Experience in Economic Development
by Philip Yeo
Special Advisor for Economic Development,
Prime Minister's Office, Government of Singapore
and
Chairman, SPRING Singapore
Panama Conference
Where the World Meets
24 Feb 2011
Singapore: A Free Port from 1819
• Early accounts showed
Singapore has been a trading
post since 13th century.
• Modern Singapore was founded
in 1819 by Sir Stamford Raffles
o Spore became centre of govt for
the British Straits Settlements and
later a Crown Colony
o Blossomed as a free port trading
with India, China, Europe and US
• Occupied by Japan during WWII
from 1942-45
• Continued to be key trading hub
through and after the war
• Attained self-government in
1959, joined Malaysia in 1963
and finally became an
independent nation in 1965
2
Singapore …Singapore Today
Others
5.8%
Manufacturing
22.2%
Other Services
Industries
10.7%
Business
Services
14%
Construction
4.5%
Financial
Services
11.9%
Information &
Communication
s
3.6%
Wholesale &
Retail Trade
16.5%
Hotels &
Restaurants
2.2%
Transport &
Storage 8.6%
•
Successful economy – 2010 GDP: US$237 bn or US$46,730 per capita
•
Open and Diverse Economic Structure– manufacturing, trade, business services,
financial services are key pillars
•
An International Financial Centre – serving the region and beyond
•
Global Knowledge City – home to world-class companies and learning institutions
•
Cosmopolitan makeup – about 1/3 of the 5 mil population is non-S’porean
Contribution of Manufacturing to 2010 GDP
Other Services Industries
10.7%
Business Services
14.0%
Others
5.7%
Electronics
7.0%
Chemicals
2.4%
Financial Services
11.9%
Manufacturing
22.2%
Biomedical Mfg
4.3%
Precision Engineering
3.0%
Information &
Communications
3.6%
Hotels & Restaurants
2.2%
Transport Engineering
3.3%
General Mfg Industries
2.2%
Construction
4.5%
Transport & Storage
8.6%
Wholesale & Retail Trade
16.5%
4
Singapore Economy as a Dynamic Pyramid
●
Agency for Science, Technology & Research
- Generating Know-How
- Attracting Whales
- Nurturing Guppies
Global
& Large
Companies
~ 1,400
●
Economic Development Board
- Attracting Foreign Direct Investments
- $100m
●
IE Singapore
●
- Expanding
Overseas Market
Access
Small & Medium Enterprises
~ 30,000
Micro-Enterprises
~ 110,000
●
JTC – Industrial Land & Space
SPRING
- Nurturing and
Growing
Enterprises
- $1m
Trade Key to Economy
• Singapore’s trade is ~3 times its GDP; and
has grown at a CAGR of 7% since 2000 to
reach S$902 bil in 2010
• 18 FTAs covering 24 trading partners
• 60 comprehensive DTAs and 7 limited DTAs
• 38 IGAs
• Key Multi-lateral Agreements in the works
include ASTEP, EUSFTA, Trans-Pacific
Partnership, DOHA Development Agenda etc
Trade
US$ 705 bn
GDP
US$237bn
Spore’s Key Trading Partners
2010
Others
Saudi Arabia
S$129.5
bn
S$16.4 bn
14.4%
1.8%
Australia
S$21.8 bn
2.4%
Philippines
S$22.3 bn
2.5%
India
S$30.7 bn
3.4%
Thailand
S$31.3 bn
3.5%
Taiwan
S$42.7 bn Korea
4.7% S$44.1 bn
4.9% Japan
S$55.6 bn
6.2%
Hong Kong
S$60.0 bn
6.7%
Source: IE Singapore
Malaysia
S$106.6 bn
12%
EU
S$99.4 bn
11.0%
China
S$95.3 bn
10.6%
Indonesia
S$67.9 bn
7.5%
US
S$78.4 bn
8.7%
6
Singapore Port
• The Port of Singapore has
prospered in tandem with growth
in global trade.
• Ranks amongst the busiest ports
in the world:
o World's #1 port by shipping tonnage
since 1986
o World's #1 container port in 2005 2009
o World's #1 trans-shipment port
o World's #1 bunkering port since
1988
o World's #1 port by cargo tonnage
until 2005, and in 2008
• Trans-shipment accounts for bulk
of Singapore’s volume. Wide
variety of cargo types, with
multiple destinations
Top Container Ports in the World
2009
2010
1
Singapore, 25.9M TEU Shanghai, 29.1M TEU
2
Shanghai, 25.0M TEU
3
Hong Kong, 20.9M TEU Hong Kong, 23.5M TEU
4
Shenzhen, 18.3M TEU
Shenzhen, 22.5M TEU
5
Busan, 12.0M TEU
Ningbo, 13.1M TEU
6
Guangzhou, 11.2M TEU Busan, 13.0M TEU
7
Dubai, 11.2M TEU
Guangzhou, 12.6M TEU
8
Ningbo, 10.5M TEU
Qingdao, 12.0M TEU
9
Qingdao, 10.3M TEU
Dubai, 11.6M TEU
10
Rotterdam, 9.8M TEU
Rotterdam 11.1M TEU
Singapore, 28.4M TEU
7
Internationalisation of Singapore Enterprises
Direct Investment Abroad (DIA)
• S’pore companies are
venturing out, investing 3
times more than 10 years
ago.
S$ Billion
350
300
250
200
150
93
76
100
307
287
246
154
134 147
180
202
98
50
0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Year
Source: DOS
• Spore’s stock of outward
direct investment is
diversified across various
geographies, totaling
S$235bn (US$184m) in
2010.
DIA stock by markets in 2009 (Base: S$340Bn)
South and
Central
America,
4.2%
Others, 5.2%
North
America,
5.0%
China, 16.2%
Malaysia,
8.2%
Oceania,
6.1%
Hong Kong,
6.9%
Carribean,
13.1%
Thailand,
6.3%
Europe,
13.2%
Source: DOS
Other Asia,
9.4%
Indonesia,
6.1%
8
Development of Singapore Industries
40000
GDP per capita 
80x in 50 years
2000s:
Innovation Intensive
35000
GDP/Capita (US$)
30000
90s:
Technology Intensive
25000
20000
80s:
Capital Intensive
15000
70s:
Skills Intensive
10000
5000
60s:
Labour Intensive
0
1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008
9
Industrial Development Strategies
10
Total Manufacturing Output
(1986-2010p)
300,000
100,000
SARS CRISIS
150,000
US$25 bn (1986)
200,000
ASIA $ CRISIS
250,000
S$ mil
• Leveraging its trading hub
status, Singapore built up a
robust manufacturing base
through attracting foreign
direct investments
US$150 bn
(2009)
Manufacturing: A Key Growth Engine
50,000
• Singapore attracted four
waves of investments to
develop four key clusters,
with increasing value-add:
Data Storage (from 1986)
Semi Conductors (from 1991)
Chemicals (from 1996)
Biomedical Sciences (from
2001)
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010p
120,000
Total Output of 4 Key Clusters
US$154bn (2010p)
100,000
80,000
S$mil
o
o
o
o
0
60,000
Electronics
Chemicals
40,000
Precision Engrg
20,000
Electronics
Chemicals
Precision Engineering
2010 (p)
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
Biomedical Sciences
1986
• Manufacturing continues to
account for >20% of GDP
Biomedical Manufacturing
11
Data Storage
US$13 billion
(1997)
S$ mil
PHASE
GROWTH
PHASE
15,000
BUILD UP
20,000
PHASE
Cumulative Output (1986-2010p): US$192.6 billion
DECLINE
25,000
US$10.6 billion
(2010p)
US$1.6 billion
(1986)
10,000
5,000
0
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 20082010p
Semiconductors
Cumulative Output (1986-2010p): US$288.9 billion
S$ mil
40,000
30,000
US$1.6 billion
(1986)
US$41.9 billion
(2010p)
PHASE
GROWTH
50,000
PHASE
BUILD UP
60,000
US$7.6 billion
(1998)
20,000
10,000
0
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 20082010p
Precision Engineering
25,000
S$ mil
BUILD UP
20,000
PHASE
US$7 billion
(1993)
US$ 19.5
billion
(2010p)
PHASE
Cumulative Output (1986-2010p): US$241.5billion
GROWT
H
30,000
15,000
10,000
US$2 billion
(1986)
5,000
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010p
Chemicals
US$59.2
billion
(2010p)
Cumulative Output (1986 – 2010p) : US$567.2 billion
120,000
S$ mil
100,000
1995 Construction
started on Jurong
Island
80,000
(US$12 billion)
Official Opening
of Jurong Island
(US$22 billion)
60,000
40,000
20,000
0
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008 2010p
Jurong Island: Heart of Singapore’s
Chemicals Hub
S$ 7 billion Reclamation Project
Singapore
S$38b of investments
99 companies
Over 15,000 employees
16
Pharmaceuticals
Cumulative Output (1986 – 2010p) : US$137.1 billion
S$ mil
20,000
15,000
PHASE
25,000
US$17.1 billion
(2010p)
GROWTH
BUILD UP AND
30,000
US$4 billion
(2000)
10,000
5,000
0
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010p
Tuas Pharma Park
18
Developing Singapore as a Global
Hub for Knowledge and Innovation
19
Singapore – Biopolis of Asia
20
Creating economic value
START-UPs based on new tools, reagents, assays etc.
Novel
Techniques
Life Science
Tools – New
Applications Devt
Novel Mfg
Technology
Public
Sector
R&D
Spun out from IBN
Identified as one of industry's most
innovative emerging laboratory
technologies1
PharmBio Mfg
Technologies
Spun out from SIgN
Predicts and optimize peptide
vaccines, reducing cycle
development time
New manufacturing R&D centres/pilot
plants/facility e.g.
GSK Green Manufacturing endowment fund
taps onto R&D expertise in BTI, IBN, NUS,
NTU, ICES
Private public partnerships e.g.
Novel Technology
Platforms
R&D
collaborations
Novel
Biomarker &
compound
‘Niche’
Research
Organizations
1LabAutomation's
Roche’s partnership with Singapore
institutions (see next slide).
Service providers based on technology platforms
developed, fill industry’s in-house capability gaps e.g.
prestigious
Innovation AveNEW
Clinical Imaging Research Centre: NUSA*STAR joint partnership with Siemens
22
Fusionopolis Facilities
Serviced Work-Live
Apartments
Fitness Gym & Pool
Skybridges and Sky
Gardens
Business and
Research Space
Shared
Conference Rooms
500-seat
Experimental
Performance Theatre
Retail and F&B Podium
one-north MRT Station
23
R&D Partnering with Industry
24
Commitment to R&D
4.0%
R&D Spending as % of GDP
Target of 3.5% GERD/GDP by 2015
3.5%
Current target: to reach 3% GERD/GDP by 2010
3.0%
2.8%
2.8%
2.5%
2.5%
2.1%
2.0%
2.2%
2.1%
2.2%
2.3% 2.3%
1.9%
1.5%
1.0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Gross Expenditure on R&D (GERD) / GDP
5-year S&T Plan
National
Technology
Plan
(1991-1995)
S$2 billion
National
Science &
Technology Plan
(1996-2000)
S$4 billion
Science &
Technology
Plan 2005
(2001-2005)
S$6 billion
Science &
Technology
Plan 2010
2006-2010)
S$13.9 billion
Source: R&D Survey 2000-2008
Research, Innovation &
Enterprise Plan 2015
(2011-2015)
S$ 16.1 billion
25
Comparison of R&D Intensity
5
4
Sweden
United States
Finland
Japan
Korea
GERD/GDP (%)
Switzerland
Austria
3
Taiwan
Denmark
Germany
Singapore (2008)
France
2
Canada
Belgium
Singapore (2009)
United Kingdom
China
1
0
0
4
8
12
16
FTEs per 1000 Labour Force
Source: National Survey of R&D in Singapore 2009 and OECD MSTI 2010_1
26
RSE + PG students per 10,000
Research Scientists and Engineers (RSE) and
Full time postgraduate (PG) students
Building up R&D Human Capital
(2000 – 2009)
27
Human Capital –
Catch a few Whales !
28
Attracting International
Scientific Talent
Dr Sydney Brenner
Scientific Adviser,
A*STAR
Dr David Srolovitz
Exec Dir, IHPC
Prof Dim-Lee
Kwong
Exec Dir, IME
Dr Pantelis
Dr Keith Carpenter
Alexopoulis,
Exec Dir, ICES
Exec Dir, DSI
Dr Edison Liu
Exec Dir, GIS
Dr Jackie Ying
Exec Dir, IBN
Prof Charles
Zukoski
Chmn, SERC
Sir George Radda
Chmn, BMRC
Prof Stephen Quake
Consultant
Dr Phil Ingham
Dy Dir, IMCB
Dr Jean Paul
Thiery
Dy Dir, IMCB
Dr Edward Holmes
Dr Judith
Executive Dy Chmn (TCSG), Swain
BMRC &
Exec Dir, SICS
Chmn, NMRC
Sir David Lane
Chief Scientist
Dr Birgitte Lane
Exec Dir, IMB
Dr Davor Solter
Prof Peter Gluckman
PI, IMB
PI, SICS
Dr Philippe
Dr Alan Colman
Kourilsky Chairman, Exec Dir, SSCC
SIgN
Prof Paola
Castagnoli
Scientific Dir,
SIgN
Dr Frank
Eisenhaber
Director, BII
Dr Dale Purves
Exec Dir, NRP
Dr Alex Matter
Director, ETC
Prof David
Dr Stephen
Townsend
Cohen
Head of PET and SPECT Acting Exec Dir,
Group, SBIC
IMCB
29
Human Capital –
Train 1,000 PhD Guppies
Guppy – 0.03 meters
30
Nurturing & Developing Human Capital
(Guppies)
Evelyn Thangaraj
2005 A*STAR YRAP
Scholar
(currently A*STAR NSS
BS Scholar, Medicine,
Imperial College, London)

10-14 yrs
Youth
Science
15-18 yrs
YRAP &
A*STAR
Science
Awards
19-23 yrs
NSS(BS)
PGS
24-30 yrs
NSS(PhD)
AGS
SINGA
Young
Whales
Guppies
Le Ngoc Phuong Lan
2005 A*STAR YRAP
Scholar
(currently A*STAR NSS
BS Scholar, Pharmacy,
University of London)
Senior
Guppies
Talent Pipeline

< 35 yrs
AIF
AGS
(Post-doc)
31
Human Capital: International Guppies
MIT
Bio Engineering
(Hong Kong)
Stanford
Chemical Engineering
(Shanghai)
MIT
Physics
(Malaysia)
Stanford
Computer Science
(India)
MIT
Chemical Engineering
(Vietnam)
32
Human Capital: Singapore Guppies
Cambridge, London
Medicine/PhD
Stanford
Computer
Science,
PhD
Stanford
Developmental
Biology
PhD
NUS
Biomedical
Sciences
PhD
Carnegie
Mellon
Computer
Science,
BSc
Cambridge
Natural Science
Biology
BSc
NTU
Biological
Sciences
BSc
Stanford
Genetics
PhD
Imperial College London
Cancer Biology
PhD
Harvard
Stem cells
Post-Doc
33
Singapore as a Financial
Centre for the Region
34
Financial services: a key pillar of our economy
Composition of Singapore’s 2010 GDP
Other Services
Industries
10.7%
Others
5.7%
Manufacturing
22.2%
Business Services
14.0%
Financial Services
11.9%
Construction
4.5%
Wholesale & Retail
Trade
16.5%
Transport & Storage
8.6%
Information &
Hotels & Restaurants
Communications
2.2%
3.6%
35
International Financial Centre
Supporting Asia’s Growth Needs
o
o
o
o
Financing for international corporates
Financing for growing trade flows
Risk Management for commodity trading in Asia
Financing for the maritime sector
36
International Corporate Financing
More than 700 financial
institutions in Singapore
serving Singapore and
beyond
•
•
•
•
•
•
•
•
166
152
111
92
74
66
52
34
Banks
Insurance Coys
Fund Managers
Securities Dealing
Financial Advisors
Insurance Brokers
Futures Trading
Corporate Finance
36,400 International
Companies in Singapore
13,800 North America,
Europe, Japan
Serving
the
Needs of
3,000 China
3,900 India
2,600 Australia & NZ
7,800 ASEAN (excl. Spore)
5,300
Rest of World
37
Regional Loan Financing Centre
Total loans extended by Singapore-based banks have tripled over
the last 20 years. 2/3 of that is dominated in foreign currencies.
Total loans (USD) Million
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source – MAS (assuming SGD/USD of 1.3)
38
Regional Corporate Treasury & Cash Management Hub
Corporate Treasuries - Demand for Products to Hedge Financial
(such as Currency, Interest Rate) Risks
Largest FX and
OTC derivatives market
in Asia ex-Japan
with average daily turnover of
> US$300bn
Leading FX teams in Singapore
Source: MAS
39
Risk Management for commodities
Asian Trading
Hub for AgriCommodities
World’s Third
Largest Energy
Trading Hub
Largest
Commodity
Derivatives
Hub in the
Asia-Pacific
Asian HQ for global banks’
commodity derivatives trading
Access to Trading and Clearing
Infrastructure
40
Financing Trade Flows
Growing Trade Flows
1378 ► 2,475
(5%)
Leading Trade
Finance teams
998 ► 2.247
(7%)
864 ►1,306
(4%)
616
► 829
(3%)
4,479
► 7,171
(4%)
3,702
► 10,763
(9%)
134 ► 448
(11%)
137 ► 1,574
(23%)
US$ BN
2008 ► 2020
(CAGR)1
184 ► 608
(11%)
204 ► 1,159
(16%)
North America
South and Central America
Europe
Africa
Asia
Source: Global Insight, WTO, Oliver Wyman
41
Centre for Ship Financing and Marine Insurance
Leading Shipping Banks in Singapore
YOY Growth of Marine Insurance
Premiums Written from Singapore
40.00%
35.00%
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
2008-2009
2007-2008
2006-2007
2005-2006
42
Singapore As a Global City
43
Singapore’s Tourism Performance
Visitor Arrivals (VA), Tourism Receipts (TR)
VA (mil)
TR $ (bil)
2010 VA: 11.6 mil
16
20
2010 TR: $18.8 bil
18
14
16
12
14
10
12
8
10
6
8
6
4
4
2
0
2
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
VA (mil)
6.2
7
7.7
7.5
7.6
6.1
8.3
8.9
9.8
10.3
10.1
9.7
11.6
TR ($bil)
8.5
9.6
10.1
9.1
8.8
6.9
9.8
10.9
12.4
14.1
15.2
12.4
18.8
VA (mil)
0
TR ($bil)
44
Formula 1 Singapore Grand Prix
Catalytic Effect
Big companies with financial
backing are expressing an interest
in hosting events for purpose of
business development in
motorsports, e.g., NASCAR.
Magnet for Business
Networking
• C-suite networking for specific
industries e.g., finance &
banking, oil & gas.
94% of corporate packages sold
– suites are used for business
cultivation
• Who : Financial (UBS, HSBC, RBS,
OCBC), Legal, Shipping, Fast
moving consumer good sectors
•Started in 2008
• Why: ‘ Customer Engagement
Efforts’
•First F1 night race
• Targeting: Corporate Clients
- Straits Times, 3 Sep 2010
•Robust entertainment lineup over the period
•Attracted ~240,000
attendees over 3 days
Track-side hotels (occupancy >90%)
benefited from increased demand for MICE
facilities, guest rooms and dining options
45
Opening of Integrated Resorts
• Celebrity Chef Restaurants
(e.g. Guy Savoy, Wolfgang Puck, Osia)
• Musical - Lion King Show
• Universal Studios, Singapore
• Circus Theatre show - Voyage de La Vie
• Flagship and concept stores for global
brands (e.g. Louis Vuitton, Chanel)
• Flagship concept stores of global
brands (e.g. Hersheys concept store, first
Victoria Secrets store outside US)
• Opening in 2011 (Crystal Pavilion,
LVMH, ArtScience Museum)
• Opening in 2011 (Maritime Experiential
Museum & Aquarium, Marina Life Park)
Total = over 120,000sqm of MICE facilities, 3,900 luxury rooms &
suites, over 74,000 sqm of retail
46
Sharing Singapore’s Experience
in Urban Solutions
47
Projects in Other Countries
• Singapore started to
share its town-planning
and industry
development expertise
with other cities from the
1990s
• The early projects
included Batam
Industrial Park in
Indonesia and WuxiSingapore Industrial
Park in China
Batam Industrial Park
Wuxi-Singapore Industrial Park
48
Vietnam Singapore Industrial Park
49
China-Singapore Suzhou Industrial Park
Sino-Singapore Tianjin Eco-City
Bangalore International Technology Park
Key Challenges for Singapore
• Face Global Competition
• Compact and dense urban setting
• Ensuring Economic Competitiveness
• Nurture an Enterprising culture with:
Passion (Risk taking)
- Determination (Hard work)
- Vision (Global)
- Focus (Operational)
-
53
Key Proposals of Economic Strategies Committee
54
Budget 2011 - Boosting Skills and Productivity
• Doubling the National
Productivity Fund to S$2
bn (~US$ 1.54 bn)
• Enhanced Productivity and
Innovation Credit -- 400%
tax deduction for
productivity and innovation
expenditure , capped at
$400,000 for each
category
• Further Increases in
Foreign Worker Levy, by
between $60 and $200
55