This note is based on living in Singapore and travelling in the region from Jan to Dec 1998 – originally written for my web-site in March 2005, I have re-touched it slightly for the posting here
A personal note:
Well, this note was long overdue when I wrote it originally in 2005. We lived in Singapore in 1998 and I had made many observations there but I had never pulled it together to write a coherent note on our experience and observations there.
1997 October was when life took an unexpected turn. I was working at Infosys in Bangalore , when I was asked to undertake an assignment in Singapore . Prior to that point, I had never considered working outside the country of my birth.
But that request from my General Manager at Infosys to go to Singapore changed my perspective completely and was the 1st step to our becoming “Global Nomads”. Even when I was stepping on the flight from Madras (Chennai) to Singapore , I thought that I would spend a few months there, bring a part of the project back to Bangalore and continue to live in Bangalore for several years enjoying the cushy life at Infosys.
But a series of events and realizations changed all our plans of living in Bangalore , India :
- Sonika joined me a month after my arrival in
- My project (5 months in at Singapore) decided to move back to Bangalore earlier than planned and I therefore jumped ship and started working for a local start up – (the bridge to India was on flames)
- We realized upon arrival in
- The travels we did in SE Asia in just one year of stay in Singapore (to Hong Kong, Thailand and Malaysia) got us hooked – we got addicted to seeing new places, discovering new sights, eating new food and above all interacting with people with completely different perspectives of life – the “foot itch” that propels us till date to different parts of the world on a regular basis was indeed developed here in SE Asia (there was no looking back on the decision to move out of India for the foreseeable future)
With this background on why and how we landed up in
The demographics and ethnicity of the region and its influence of current day culture and events
A little history is in order since the events of the past have a profound influence on the current situation and culture of the region:
- The 1st major lasting cultural influence to impact the region was that propagated by the Hindu kings of Southern India who conquered the area and introduced “Brahminical” teachings to the region – the impact though directly visible only in Bali does show up in the temples in the region and even in the names of the people. Though Islam has complete sway in Malaysia and Indonesia , names and characters from Indian religious texts are an integral part of the social and cultural fabric of the region. Even the name Singapore is a derivative of the word, “Singha” meaning Lion and “pore” is of course the anglicised version of the word “pur” used as a suffix in the names of several Indian towns; the language spoken in Malaysia and Indonesia called “Bahasa” is again replete with terms from Sanskrit, the ancient Indian language.
- The next wave that hit the region again was exported from India – this time it was Buddhism and it found its mark in Thailand ; to this day, Thailand and several other SE Asian countries practice their localized version of the Buddhist religion.
- Trade winds carried Islam from the Arabian peninsula to Gujarat in India from where religiously driven merchants exported it to Malaysia and Indonesia and once and for all established the religious foundation of the region which is intact till today; however the profound influence of Hinduism and Buddhism in the region has ensured that the Islam practiced in this region is the most moderate form anywhere in the world (the recent upsurge of Jihaadi movements is a very recent phenomenon and an anomaly in this region of peaceful moderate Muslims).
- Widespread famine and civil wars drove a huge number of Chinese to the region. British colonists brought in more labourers to work on rubber plantations from
- The Chinese labour force was joined by Tamils from southern
- Once the British yoke loosened, there was a re-adjustment of population and
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History’s influence has had a direct impact on the demographics, culture and the economics of the region:
- The ethnic composition of the lands here:
o Malaysia is composed of largely people of indigenous Malays (called Bhumiputras),a good number of people from South India and a vibrant community of Chinese, the rough break-up being 60% Malay, 30% Chinese and 9% of Indian origin
o Singapore ’s ethnicity is approximately 65 % Chinese, 20 % Malay, about 10% South Indian and the rest are expatriates from different parts of the world
o Indonesia is largely homogeneous except for a very thin Chinese population.
o Hong Kong and Thailand are largely homogeneous ethically speaking
- Largely “Chinese” Singapore having to struggle hard to maintain its independence from Malaysia and Indonesia in its initial years; this struggle to survive has helped it harden and choose a path of freedom by developing a resilient economy; the “siege” mentality has helped it become self-dependent in most areas despite its small size (640 square kms) and very limited natural resources
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o Singapore has 4 official languages (English, Mandarin, Tamil and Malay)
o Allows all religions to prosper – in fact it gives 1-day off for each of the major religions practiced here (Islam, Hinduism, Buddhism and Christianity) - only India other than Singapore has national holidays for all of these religions
o Even apartments are sold by the Government in the ratio of the ethnic population – so every floor of the Housing Development Board flats have the right mix of Chinese, Malays and S Indians!!
- The creation of the strict laws of Singapore on cleanliness are a direct result of the composition of the population here; Lee Kuan Yew, the “father of Singapore” set up these draconian rules since he was very conscious that social hygiene (i.e. upkeep of surroundings outside individual homes) was a low priority among the three main ethnicities and therefore only strict laws could help instil the requisite discipline amongst the population.
- People of Chinese origin dominating businesses in the region.
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- The reverence that Singaporeans hold all things British even though politically and economically they are very close to the
A collective realization and its resultant benefits
The ethnic divisions, the religious differences and the acrimonious history of the area made a perfect recipe for disaster. In 1950s and 1960s as these nations became independent from colonial rule, they were abysmally poor too, were recovering from the trauma of World War 2 and had high population densities. Anyone looking at these facts would have predicted unmitigated gloom and strife for the area. But what transpired is a miracle. Somewhere there was a collective realization in the region that the economic imperatives are more critical than culture and politics. This did not happen due to any one “star” inspirational leader, there was no planned date when all in the area congregated and agreed to pursue a common dream of prosperity but the miracle has occurred and the results are there all over the region for everyone to see. Some facts need to be reiterated:
- Japan had been flattened by bombs in WW2 and had 1/8th the US GDP, South Korea was as poor as Sudan, Taiwan was like Zaire today and the rest of the nations even poorer but today the story is different – Japan is the 2nd largest economic power in the world even after its long deflationary years in the 1990s; Singapore and Hong Kong have routinely topped the Economic & Political Risk surveys for the most economically competitive nations in the world and for the freest business environments.
- Between 1970 and 1990, desperately poor in
- The superior quality of infrastructure developed in this war ravaged area is dazzling (more about that in the next sub-section).
- Check an economic measure today to gauge the continued vibrancy of the economy in the region (both
o The current account surplus (latest Economist Intelligence Unit figures) - of the countries in the region (in billion US $): Hong Kong (14.2), Singapore (27.9), Taiwan (19), South Korea (29.1), Malaysia (14.7), Thailand (5.5), Indonesia (4) and Japan (171.8); contrast that with the “rich” OECD countries (US, Britain, France, Germany, Italy and Canada) all of which have a current account deficit other than Canada and Germany.
o The GDP growth rates of these countries in 2005 was as follows: Hong Kong (7.2%), Singapore (6.5%), Taiwan (3.3%), South Korea(4.6%), Malaysia (5.6%), Thailand (5.1%), Indonesia (6.7%) and only Japan lagged this year (0.6%); meanwhile in the “rich” OECD countries, only the US has passed the 3% mark this year.
Some of the factors that seem to be instrumental in this economic growth seem to be:
- Willingness of the people to make tremendous personal sacrifices. Examples:
o East Asia’s work force has puts in very long hours (even the unions are fine with these hours, unlike in the West and in other socialist countries, since they all believe that growth is the path to salvation), is largely loyal to its employers and willing to put aside personal conveniences for the greater glory of the entities they are part of
o During the Asian Economic crisis, we witnessed an unprecedented phenomenon in Singapore – ministers took a huge pay cut, the bureaucrats followed and even the unions immediately announced reduction in their wages – to ensure that the nation remains economically attractive and could rebound from the crisis that it was suffering
I have never heard of or seen such a story except in post-war Germany
I have never heard of or seen such a story except in post-war Germany
- Education and training to workers was stressed upon ever since independence across each of these countries and therefore the workers in the region are very productive; a willingness to adapt new ideas (no suffering from “Not Invented Here” syndrome) further accelerated the productivity rate.
- Enlightened Governments in the region paid special attention to primary and secondary education and provided equal opportunity at work to men and women even in the most Islamic regions of the area. This led to huge numbers of young, educated members joining the workforce and producing a surplus that could be channelled to external export markets.
- Large amounts of capital was directed to growth of infrastructure in early stages of development that laid the foundation of these economies and generated employment; interestingly, this infusion of capital was domestically funded due to high domestic savings rate (typically 35% savings rate across the region) – a phenomenon that was a result of the local culture of economic prudence and the reality that individuals could not depend on their then economically weak Governments to meet their needs.
- The sensible and widely prevalent move by the Governments in the region not to tax interest and capital gains thus inducing more investment into the economy.
- The Governments in the region for most part focussed on keeping inflation low, providing tax breaks for infrastructure investment, providing cheap credit to stimulate growth and creating postal savings banks to tap rural and small savings.
- Smart Governments here concentrated on building foundations not huge state run projects.
- Once there were enough people in the work-force, the Government provided incentives to control the population boom and in the Islamic countries, the Government did not bow to religious pressures that wanted uninhibited growth of population.
- Military dictatorship and/or autocratic rule (till recent) is another common phenomenon in the region but unlike dictatorships in
o Singapore’s government decided to give special concessions to Seagate, the hard disk manufacturers to move its manufacturing base here – tax incentives, opened a technical institute to focus on hard disk technologies and lower land price – in any democratic it would have been a cause of much debate but Singapore’s did not allow any such discussion – the result was that Seagate set up its base in Singapore and an electronics industry grew around it which drew all its rivals (including Quantum) there and led to Singapore becoming the centre of the world’s hard disk and supporting electronics industry.
o Without holding any referendums and allowing public debates, the Government of Singapore created artificial islands in the sea off its coast to build oil refineries there – today, Singapore refines the maximum amount of crude in the world – a majority of crude oil passing from the Gulf countries to the Pacific Rim countries of China, Japan, the US and Latin American countries gets refined here on its way to these countries; thus a country that had no credentials to refining oil has become a giant in the industry.
- Above all, the Governments in this area are very competitive and want to prove their superiority to each other on the economic front. Thus they strive to do better than their neighbours in creating infrastructure and competing for investment; that of course augurs well for all these economies.
This collective wisdom of the region to focus on the economy is best evident in the multi-Government ASEAN (Association of South East Asian Nations) with its 2-pronged agenda: to promote mutual trade and remove barriers to trade amongst the member countries. This free trade co-operation has shown its might much before NAFTA and the EU were even functional.
The allure of the region: world-class infrastructure, commercial activity, good governance and in some cases natural beauty
The economic rise of the region has resulted in outstanding infrastructure being developed here. The public transport, roads and the airports allow locals and travellers to be whisked away from one part of the region to the other. This section of the note describes the infrastructure marvels, good governance principles and natural attractions of the region:
- Amongst all the cities and countries that I have visited in the West or the East, I have not found in any city infrastructure that can compare with
o A public transportation network that reaches every corner of the city – the comfortable trains of the MRT glide smoothly around the island city, Light Rail Transits and a fleet of well maintained buses efficiently feed the main train transit system and you never have to wait for your public transport – it is meaningless to own a private car in the city for nothing is unreachable and if you are in a dashing hurry, plenty of reasonably priced comfortable cabs will get you to your destination; a handy inexpensive and comprehensive bus and train guide captures all the myriad combinations that you can take to get to your destination. Electronic payment cards allow thousands to enter these buses and trains without a hitch. Amazing!
o During the roaring days of Japanese growth, Singapore built its inner core of gleaming shopping towers and these buildings are a delight for any keen shopper – apparel, accessories, electronics and gift items are available from every corner of the world; brand names rule and the comfort of the shopping environment makes it easy to spend hours in these malls.
o Plastic rules too! While in
o The entire city has an unrivalled standard in providing services – be it at the bank (I closed my bank account in 5 minutes at the end of 1998, and had walked in with 10 $ to open an account, and was never charged any service fees during the entire year), elegant hospitals, post offices (equipped with facilities for faxing, couriering and e-mailing besides providing the postal pick-up and drop-off) and even the washrooms in every shopping mall and railway station is well maintained (there is even a competition among train stations for the best maintained toilet in the city !!)
- The next big marvel here is that the city-state has a Government that works! Be it in its foresight, focus on growth or in providing efficient services, this city-state has few rivals. Examples of a Government at work include:
o The city state not only built industrial complexes to attract foreign investment and islands to become the leader in oil refining, but also had developed a stat of the art telecom infrastructure with the whole city running on a broadband network way back in 1998 (for the technically inclined, an ATM network), a sea-port that is the most technologically advanced in the world (and in 1998 aspired to become a place where ships would be loaded and unloaded without any manual involvement) and an airport that knows no comparison in terms of facilities (excellent restaurants, trains connecting terminals every minute, belt walkways to every spot of the airport, gym and pool for people in transit, free entertainment for waiting passengers, a multi-faith worshipping centre and of course a wide choice in shopping !!)
o The Government services are provided in a seamless, efficient fashion. Be it getting a work permit from immigration, a police clearance for applying for Canadian Permanent Residence or getting my refund for income taxes, the services were performed very quickly, efficiently and without requiring any “follow-throughs”.
o The Government maintains the city-state in a beautiful condition. Tough laws and efficient services keep the streets clean, regular watering/washing of plants and trees make the city green and zero tolerance of corruption ensure that public utility services are available to all.
o A large component of the Prime Minister’s annual salary is incumbent upon the leader of the country delivering
- Unlike
- Like its other East Asian cousins, the Government has focussed on infrastructure in a big way - outstanding roads across the nation, even a 3 –lane expressway winding through mountains; excellent development of oilfields and even an IT city that captured the imagination of the world for a few years; of course the showy Petronas Towers in Kuala Lumpur ranks among the top 2 building in the world; the telecom and energy infrastructure are also world-class.
- The combination of the above factors, plus a bigger and more varied geography than Singapore , more relaxed people than in Singapore all make it very personally alluring for me and I often think of it as a possible destination to live and work in at some point of time in the future.
In my view, Malaysia is one of the most under-rated nations in the world. Its tourist attractions are at par with the best in the region; its economy has been vibrant even through the tough days of the Asian Crisis and yet it hardly gets acclaim and getting to any corner of the country is a breeze.
- For me, this city reminds me of movement - fast movement at crazy speeds and hyper-active, energetic citizens. Everyone is in a hurry, completes their transactions quickly and glides around town swiftly. I get that same sense only in two other cities of the world –
- The city has the most beautiful skyline in the world – a dense collection of high rise towers reaching upward with a backdrop of hills and the waves lapping the shores is a majestic sight – takes my breath away every time I think of the view or even look at my photos of the city.
- Developed as a trading outpost of the British, it is a businessman’s dream come true. Low taxes (no capital gains, 16.45 % corporate, 15% maximum salary), no forex control (therefore quicker multi-currency transactions are possible), a very firm rule of law and a strong justice system make it extremely attractive as a business destination. When we lived in the region,
- Again, a remarkable infrastructure (moving millions in its Mass Transit system and interconnected buses, legendary penetration of telecom, a well developed port and a modern world class airport) is the foundation of this Self Administered Region of China.
- It definitely ranks as the number one shopping destination in the world with goods for every wallet. A fashion conscious citizenry (who I rank along with Parisians, Londoners and New Yorkers), easy access to Chinese apparel and accessories, a trade obsessed nation and a “never give up” community of shopkeepers all make the experience of being at the markets very memorable.
Only the recent growth of
- This is a beautiful country, perhaps the most beautiful place in the entire region. From Chiang Mai in the North to the beautiful islands of Phi-Phi and Phuket, the country is full of places to visit and enjoy a vacation in. The food of the country suits both the western and the eastern tongue and never fails to delight.
- The mystique of Buddhism, the daily traditions of the villages and its hospitable, peace-loving, perpetually smiling, relaxed people add additional allure to the country.
- An excellent telecom infrastructure, decent roads and good transport make every corner of the land accessible and safe to travel to.
- It is a must see destination for all the above reasons and a place right out of travel brochures.
While the Asian Economic Crisis was triggered by the bank collapse in
– play the role of wonderful welcoming hosts. (Additional comments from 2008: Of course adding to the wish-list is that the Army retreats in the background and democracy holds sway once again taking this wonderful country back on its path to progress).
The challenges of the region
Of course, every thing is not perfect in the region. There are some key failings and importantly weaknesses that inhibit a further climb of the region to greater heights.
The biggest failure of the region has been its inability to develop transparent and objective public institutions needed to run sophisticated societies (i.e. multi-party democracies, free public debate and high respect of individual liberty). Autocratic regimes and omnipotent political parties have ruled the area for very long though things are improving very significantly of late.
The next biggest problem is that there is no indigenous balance of power so the region is dependent on US, Chinese or Japanese direction.
Also, ASEAN countries are so wary of interfering into each other’s internal politics that brutal regimes like
The message is simple - focus on the area’s economy and turn a blind eye to social and political issue of the individual members of the group.
However since then
In my view, there are some country specific weaknesses/challenges that hold these nations back:
- Autocratic rule and whimsical leadership made the nation very unpredictable and far less attractive to investors than it naturally would have been; with the new PM, things should be better
- Its treatment of the Chinese people prevents it from fully participating in the rise of China; instead of nurturing the Chinese who have strong linkages back home and could spur trade with the colossal giant, the nation has deliberately chosen to suppress the growth of the community.
- The occasional flirtations of its people with Islamic fundamentalism are worrying – a largely open minded Islamic nation, the occasional pandering of its people to fundamentalists tarnish its image and can potentially damage its economy.
– This Specially Administered Region (SAR) of
– The other factor that makes Hong Kong less attractive than Singapore is that it has not embraced the global language of business, English as whole-heartedly and its people are sometimes hostile to outsiders – a testament to this fact is the relatively low presence of US and other Western (except British) companies here compared to their overwhelming presence in Singapore.
Finally,
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- The outstanding track record of the Government in making
- Finally, the future of a resource starved, 3-million strong
I will end my
Last words
We have very fond memories of the region and our stay there in 1998. I wish the people of this area the very best in their continued growth and ability to demonstrate their grit and power despite numerous challenges. I am quite optimistic that the recent activities of a few Islamic fundamentalists were just a bad phase in the history of the area where peaceful Islam has been practised for eons. Pragmatists as they are, the people of this area will suppress and control the fringe elements and once again the rest of the world will only hear stories of great triumphs from the region.
(Please note that while I do make references to Japan, Korea, Indonesia and Thailand, this “reflection” article is focussed on Singapore, Hong Kong, Thailand and Malaysia, the countries that I got to interact at an intimate level in 1998. I hope that I get to spend more time in the area to be in Philippines, Japan and Korea – places that I would have loved to visit but could not because I stayed in the region for only a year and importantly, I had to earn my living while there, thus preventing uninhibited exploration of the countries in the area.)