[LINK] The Problem with Singapore

[rfmcdonald]

Fabio Scarpello's Asia Times article "Singapore: A tale of two cities", argues that the benefits of Singapore's remarkable economic growth are not at all evenly distributed.

"There is a growing gap," said Sinapan Samydoray, chairman of Think Centre, a Singapore-based organization that deals with social issues. "The bottom 20% of the population earns less than 10 years ago in real terms. Almost 87% of the people are staying in government houses. Sixty percent of the people do not pay tax because they earn too little."

Singapore's social divide increased during the economic crisis that hit East Asia in 1997. While the average income of Singaporeans fell by 2.7% in that period, that of the poorest families fell by a staggering 49%, according to a paper by Professor Mukhopadhaya Pundarik of Singapore's National University. However, it seems the problem is inherent in the country's past and present political economy (the production, distribution and consumption of goods and services and their management).

Singapore's success story has been mainly based on attracting foreign investment. To do so, the country offered top-class infrastructure, a corruption-free environment, tax incentives and - crucially - low-cost labor. The policy has borne fruit. Multinationals poured in, and the country's economy ballooned from S$8.9 billion in 1965 to the current S$180.5 billion (US$109 billion).

In the last few years, competition from countries such as China, India, Thailand and Malaysia has meant that, to remain competitive, Singapore's workers have been asked to tighten their belts further. In addition, the new global climate spurned a soul-searching among Singapore's political elite, who decided to shift the country's economy to higher-value added activities.

This rapid economic transformation has improved the lives of many Singaporeans, Scarpello argues, but the possibility of leisure and an enjoyable life remains out of reach for all but a few.