Singapore as an economic development model
Introduction
Singapore also known as "La Perla de Asia" has proven to be an example to follow for those underdeveloped or development countries, because it went from being a "poor island" to being one of the greatest "financial centers in the world ”In half a century. The innovation and entrepreneurship that its leader Lee Kuan Yew had to design to get Singapore out of poverty with its various reforms I have considered their economic rebirth. Some Latin American countries (LATAM) have studied the growth model implemented.
Trying to at least obtain an orientation to undertake the development of its own nation; However, the political, social, economic, geographical and monetary conditions of each of them make the study only this. We will analyze some critical moments for which Singapore happened to become the country that is now, as well as some comparisons of Latin American countries have done with the purpose of identifying if they can have a similar development.
Developing
From 1960 to 1965 Singapore maintained a policy of industrialization for import substitution (ISI) as it produced for the domestic market but with a view to the Malaya Federation market (which formed with Malaysia in 1963). However, political and ethnic conflicts with Malaysia soon emerged (Singapore had a population of Chinese and Malaysia majority of Malaya) and in 1965 the Federation ends. Singapore is an independent state again. From then on Singapore applies a defined export -oriented industrialization policy (IOE).
The reasons for its economic success:
Singapore has no natural resources, but has trained people, excellent geographical location and a very good infrastructure. The Government implemented port infrastructure, airport, electricity, industrial land, while giving political and social stability. Foreign capital contributed the resources, technology and export markets that Singapore needed.
A country achieves developed status when its economic growth is reflected in the equitable progress of its human resource. From the independence of Singapore, when Lee Kuan Yew agreed to power, he promoted a series of strong deep reforms, both in the economic and socio -political plane. In the socio -political plane, drastic coercive measures were carried out as well as efforts in education, to achieve a change of mentality in its nation, leading it to levels of evolution compatible with respect for the norms and empire of the law.
At the economic level, he developed initiatives such as the opening to foreign investment, investment in infrastructure, increased commercial relationships, health investment, education and housing. According to IDB/MIF, a cluster or entrepreneur and non -financial that result in dynamic companies ”.
Even when there are no defined formulas for the development of an entrepreneur. Latin American countries have a complex historical background, many of which have had periods of great political and social instability, which have deteriorated the necessary institutional bases for their economic development.
As we know every year the World Economic Forum publishes the Global Competitiveness Index, (Global Competitiveness), also called GCI. This index measures how a country uses the resources available and its ability to provide its inhabitants with a high level of prosperity. The higher the better index will be located in the ranking. In the following table, you can see the index obtained in the last report and visualize the gap between Singapore and some Latin American countries in the competitiveness ranking.
Competitiveness ranking countries:
- Singapore [+] 1st 84.78
- Chile [+] 33º 70.54
- Mexico [+] 48º 64.95
- Uruguay [+] 54º 63.47
- Colombia [+] 57º 62.73
- Costa Rica [+] 62º 62.01
- Peru [+] 65º 61.66
- Panama [+] 66º 61.64
- Brazil [+] 71º 60.93
- Dominican Republic [+] 78º 58.31
- Argentina [+] 83º 57.20
- Paraguay [+] 97º 53.63
- Guatemala [+] 98º 53.52
- Honduras [+] 101º 52.63
- El Salvador [+] 103º 52.57
- Venezuela [+] 133º 41,83
Adapted competitiveness ranking from Latin America is late in high -tech exports unlike Singapore, a great determinant in competitive success in all developing economies is to attract the export -oriented FDI, high -tech manufactures. A study conducted by several researchers and economists sought strategic.
However, this study only reaffirms the similarity that Latin American countries have against the specialization that Singapore has. Another study in which it was presented in an “Useura Vision” magazine of the University of Panama seeks FDI, and employment exceeds that of this Latin country. It should be noted that in this study enhances the factor of education as a determining factor of economic development.
As well as the recognition that a confucian philosophy (those who see the cosmos as something harmonious that regulate In government policies. Innovation at this point not only is to do something new that broke the paradigms (disruptive innovation), if not well applied to a lasting, tax and realistic policy regarding the needs it had at that time Singapore.
Finally, another article that compares Singapore with Colombia states that the Colombian government should begin to expedite processes of economic, strategic and cooperation alliances, seeking to acquire knowledge about economic and governmental policies that Singapore applied to be in the most developed countries. Increasing qualified labor and sophistication of the economy are essential.
In the following table we will find some of the main economic indicators of the countries in question:
Singapore, Colombia, Panama and Costa Rica
- GDP per capita [+] 2.018.00 € 54.€ 69 5.€ 62 13.€ 25.€ 20
- Unemployment rate [+] I trim 2017 3.0% 8.6% 4.6% 10.9%
- Dollar exchange rate [+] 43,944 14,268 4.037,9500 1 5,697,700
- Exports% GDP [+] 2018 113.38% 12.62% 17.65% 18.53%
- Imports% GDP [+] 2018 101.83% 15.48% 35.36% 26.72%
- HDI [+] 2017 0.932 0.747 0.789 0.794
- Competitiveness ranking [+] 2019 1st 57º 66º 62º
It should be noted that the gap between the countries analyzed is quite wide, if I am Latin American countries, they seek to reach it only partially modifying any specific policy, decree or treaty only will not achieve it but also will be exposed to a permanence as a underdeveloped country or that its development does not be the indicated. Then Latin American governments who want to excel and do something different in relation to their current government policies must begin to wonder about the true factors that make the economy less productive.
conclusion
After reviewing the actions that the Singapore government implements from becoming an independent state and considering that these ideas that were very futuristic for their time, now I consider that a way to innovate not only lies in disruption, but also in doing something Well for a long time that allows full development (of any kind) and that in the case of Singapore without delay, it proved to be the key to its success.
All those Latin American countries who undoubtedly know that sacrifice through well -developed long -term policies would cause their countries to improve in their conditions; However, governments that only see for their benefit in the period that are active will find restrictions to rebound. It will not be enough to be aware of the problem, if you do not enter the action.
References
- Franco Herrera, D. (2013). Singapore: the little Giant of the Southeast Asia. Online Journal World Asia Pacific
- Collado Trejos, L., & Solís Cedeño, J. Influential socioeconomic variables in the development models of Singapore and Panama. Useful vision.
- Castro-Gonzáles, s., Peña-Vinces, j., Ruiz-Torres, a., Sosa, j. Intrapaísian study of global competitiveness from the double diamond approach to Puerto Rico, Costa Rica and Singapore.
- Gómez Gómez, L., & Jiménez Posada, M. Singapore: from an unfeasible country, to a world model. Online Journal World Asia Pacific.
- Murillo, r., Zuñiga, r., Chen, m. Is there really a Central American Singapore potential?
- Aquino, c. The four tigers of Asia: South Korea, Taiwan, Hong Kong and Singapore. In introduction to the Asian economy
- Lall, s. Export performance, technological modernization and strategies in direct investment in recent economies of Asia. With special reference to Singapore. Santiago, Chile.: United Nations.
Leave feedback