Past and Future
2. Foundations for growth In this chapter we examine the particular nature of Singapore before and at the beginning of its modern period of economic growth and the distinctive institutions and policies the PAP adapted and adopted in order to achieve the economy’s high and sustained rate of growth and its structural transformation. One purpose is to show that many characterizations of Singapore as a free-market economy with few state enterprises or state control that is commonly found in writers from the United States, who rank Singapore as the second most economically free economy in the world, are misleading. Many aspects of the government’s inﬂuence over the economy’s resources are not revealed in such numbers as the proportion of GLCs or the public sector in output, which we examined in the previous chapter. Ownership is not the main factor but rather how the government can mobilize resources and allocate them where it sees ﬁt. Another aspect to note is the close links between the business sector, especially the ﬁnancial sector, and the political elite and the view that the bureaucracy has little independent strength, points argued by Hamilton-Hart (2000). In this context it is relevant to note which sectors of the economy have been protected by the government and the way it has recently faced up to the ineﬃciencies this has caused and the strong measures it is taking to reform the ﬁnancial and banking sectors. 2.1 GEOGRAPHIC AND DEMOGRAPHIC ASPECTS Cohorts of students have been taught that...
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