Singapore market economy

May 9, 2017
Are Mini-IPOs Actually Going

It has been half a century since Singapore achieved full independence. In that time, a strong model of economic development has transformed the fortunes of the republic and its peopleIn an emotional televised press conference in August 1965, Lee Kuan Yew explained to the Singapore public that their voluntary union with Malaysia had come to end. The leader of the new, tiny city-state, had assembled journalists and television crews in order to inform the citizens of the new Singaporean republic that they would be on their own, no longer part of a political union with their much larger neighbour to the north. “For me it is a moment of anguish because all my life… you see, the whole of my adult life… I have believed in [the] merger and the unity of these two territories”, said Lee, trying to hold back his tears. “You know that we, as a people, are connected by geography, economics, by ties of kinship.”

Lee was devastated by the end of the short-lived union. During his time studying in both London and Cambridge, and living in Singapore under Japanese occupation during the Second World War, he became convinced of the need for self-governance in Southeast Asia. After the war came to a close, he hoped to end British rule, creating a political union between Malaysia and his native Singapore.

Fig 1The fledging British Empire finally gave way and granted Singapore self-governance in 1959. The People’s Action Party (PAP) was voted to power and Lee, the party’s leader, became prime minister of the island. After a referendum in 1962, and so many years, Lee’s vision came true: in 1963 it was agreed that Singapore would be admitted to a recently independent Malaysian Federation ruled by Tunku Abdul Rahman. Yet only two short years later, Lee’s lifework was it tatters. After race riots broke out in 1964 between the island’s two minority groups, Malays and ethnic Chinese, relations with Malaysia soured. Malaysia’s Government felt that the crisis was not worth the effort, and accused Singapore’s government of disloyalty, declaring that all ties would be cut between the two nations. Singapore was expelled from the union. The tiny, impoverished city-state, racked by racial strife, was now alone, no longer under the tutelage of an empire or a member of a union. Singapore was to become its own fully independent nation-state.

Singapore was able to create a prosperous society for its citizens. But this road to economic development came

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