Trade Generation by the Government

Government Initiatives

Singapore has established itself as Southeast Asia’s leading port and industrial center, as well as a leading banking and commercial center. The Government of Singapore has taken many steps to formalize their trade and industry. The Ministry of Trade and Industry was established by the Government of Singapore in 1979. It was created with the purpose of “promoting economic growth and [to] create jobs, so as to achieve higher standards of living for all.”¹ Through the establishment of Free Trade Agreements with multiple countries around the world, along with joining many Multilateral and Regional trading systems such as the Association of Southeast Asian Nations (ASEAN) and the World Trade Organization (WTO), Singapore has established itself as an enticing entity for foreign countries to trade with. In terms of investment, the government has also established Investment Guarantee Agreements (IGAs) with 35 different nations which outline legal framework to guide investment norms and protection when other countries invest in Singapore (and vice versa). This has helped to prevent exploitation of the Singapore workforce, keeping standards in the workplace relatively high.

Growth

Rooted in strong manufacturing and service sectors, Singapore continues to thrive on these two “twin engines of growth.”¹ Today, there are over 7,000 Multi-National Corporations in Singapore.¹ The island-state’s major industries is expected to continue to grow at an annual 9.7 percent this year.² This large increase in growth can only translate into more jobs and opportunities for the lower class to come out of poverty. While there is not defined poverty line by the government, as Minister George Yeo states:

“many in the bottom 10% have significant wealth in the form of CPF [state retirement funds] savings and their homes. They are not an underclass.”³

^{Effect on Poor and Model for Other Cities}

Singapore’s success was due to the strong middle class which emerged to build Asia’s second-richest country. This sort of effort must be made by other governments in other south Asian countries. Government support for industry is key to alleviating poverty in the region.

Currently, To achieve higher growth rates, the government has increasingly allowed large numbers of foreign workers to make up a labour force which was depleted due to the low birthrates (3 per 1000).³ With a large influx of cheap foreign workers, the poverty line is beginning to take on darker shade. Singapore must be careful not to neglect their poor in order to stay competitive.

Sources

1. "Ministry of Trade and Industry." Ministry of Trade and Industry. Web. 17 Mar. 2010. .
2. Economists Raise 2010 Growth Outlook for Singapore to 6.5%." Channel NewsAsia. Web. 17 Mar. 2010.
3. "What Happened to Singapore, the Land of Plenty? | The Online Citizen." The Online Citizen - A Community of Singaporeans. Web. 18 Mar. 2010. .