PM Lee Hsien Loong at the EDB 50th Anniversary Gala Dinner

Congratulations on 50th anniversary

Happy to join distinguished gathering of CEOs, EDB partners and staff in this ballroom, each of whom have played a part in Singapore’s development

Singapore’s Economic Transformation

Singapore a very different place when EDB was formed 50 years ago. Our GDP per capita then was a meagre S$1,374 and there was double-digit unemployment. Those were the turbulent, challenging external landscape in early years — we had communists, we were a state in Malaysia, Konfrontasi, separation, and British withdrawal. It was a cleak future; the odds of our small state surviving were long.

We overcame the odds and transformed our economy from Third-world to First. Today our GDP per capita almost S$60,000, 13 times that in 1961 in real terms. We transformed from trading port to knowledge economy, e.g. from low-cost manufacturer of mosquito coils and pyjamas to designing smartphone chips, creating special effects for blockbuster Hollywood movies, and producing aircraft engines for new generation of Airbus and Boeing planes. We are consistently ranked by WEF, IMD and World Bank as one of the most competitive economies globally, and the world’s easiest place to do business.

How did we achieve this extraordinary transformation?

EDB has played a key role. It has attracted billions of investments and projects, created millions of jobs, and forged reputation for Trust, Knowledge, Connectedness and Liveability.

Credit is due to EDB officers and leaders led by succession of capable chairmen – Mr Hon Sui Sen, Mr I F Tang, Mr Chan Chin Bock, Mr Ngiam Tong Dow, Mr P Y Hwang, Mr Philip Yeo, Mr Teo Ming Kian, Mr Lim Siong Guan and Mr Leo Yip. They were imbued with pioneering spirit and desire to shape a better economic future for Singapore. EDB made cold-calls on companies, cultivated relationships with potential investors, worked with other public officers to solve problems for companies, and did not take no for an answer. There are many stories chronicled in “Heart Work 2”.

Understanding Singapore’s Transformation

But to understand EDB’s success, need to look beyond EDB to the entire Singapore system.

We must appreciate how the Government and people came together to focus on economic development, and so enable EDB to succeed.

How did this come about?

First, the political leadership set clear direction. They understood that we are a small country with no natural resources or hinterland. We could only survive by connecting with the world. Hence established the right policy fundamentals — competition, not protectionism; free markets, not central planning; self-reliance, not state welfare; focusing on long-term benefits, and prepared to take short-term pain; aiming for good overall outcomes rather than trying to placate individual groups. They rallied the population to support these policies, and create the preconditions for growth.

Second, whole of Government aligned itself to formulate and implement policies that fostered growth and improved lives. They developed policies to encourage enterprise and investment, e.g. taxes, land use. Different agencies worked coherently towards national objectives, built good supporting infrastructure. JTC created vibrant “plug and play” business environment (even back then). PUB ensured reliable electricity and water supply. They trained our people for the jobs created — MOM upgraded workers to do higher level work, MOE educated students for industry needs. EDB could operate an effective front office because behind it the whole of government was completely aligned.

Third, Singaporeans stepped up to the plate. They knew that our survival as a nation was at stake, understood that we needed to work hard and work together. Hence they committed to education and upgrading, transformed confrontational labour relations to a tripartite partnership based on trust and win-win cooperation, and built the best workforce in the world

These factors enabled Singapore to consistently deliver on promises, even for seemingly impossible projects, e.g. Jurong Island. We demonstrated consistency and reliability, and built a reputation for integrity – our word counts.

This in turn, fostered a virtuous cycle. Successes boosted Singapore’s credibility and reputation, strengthened EDB’s ability to attract more companies, reinforced Singapore’s status as an international hub and developed Singapore into a dynamic global city.

These strengths are unique to Singapore. This strategic alignment and tactical coherence helped EDB perform miracles. Other countries have formed their own EDBs, but it is not so easy to replicate the entire Singa­pore eco-system behind EDB — the Whole of Government alignment and support from the people. These provided, and still provide, a vital competitive advantage for Singapore.

The Next 50 Years

50 years is a long time. No one could have foreseen that Singapore would have done so well in the past half century. It is hard to predict what will happen in the next half century.

In the ideal scenario, we would have a world at peace, globalisation continues apace. and countries compete fiercely but peacefully, and create prosperity which benefits many countries.

Even in this scenario Singapore will face many challenges, but we are confident that we can flourish. We play a Global-Asia role, be a springboard for Asian companies to the rest of the world, e.g. Tata Communications and Kingdee internationalising from Singapore. We would be a base for rest of the world to expand into Asia, e.g. Procter & Gamble, Hewlett-Packard, Shell orchestrate and coordinate their operations across Asia from Singapore. We would help companies to understand Asia better, e.g. EDB and the Nanyang Technological University recently formed the Institute on Asian Consumer Insight.

But we must contemplate less benign possibilities too — globalisation slows or worse, reverses course; support for free trade falters, and protectionism grows; other countries turn inwards, preoccupied by domestic problems. There could be unforeseen shocks — energy crisis, strategic rivalries and political upheavals, natural disasters, and consequences of global warming. It is a much more challenging environment, harder for Singapore to maintain its security and earn a living. But all the more important that we be united and respond as one people, and (except in the most extreme situations) we still have no choice but to stay open, and earn our living by servicing the world.

EDB and Singapore must be ready for all scenarios. What must we do?

EDB needs to maintain its edge — build new links and deepen existing ones, find ways to boost our strengths and address our challenges, e.g. rising costs, continue to seize opportunities and bring in projects, reinforce Singapore’s leading position amidst the many choices for companies in today’s globalised world.

Singapore — Government and people — must continue to focus on economic development. We must adhere to policies that foster growth, no longer through expansion, but by transforming and upgrading ourselves. We must offer a high-quality total business environment superior to what other countries can offer, and thus enable EDB to deliver to investors what it promises, and deliver to Singa­pore the investments we need to grow and prosper.

Since the General Election, investors have been asking us whether Singa­pore will change direction. My answer is no. Singapore’s fundamental constraints remain and we need to remain connected to the world to survive. The Govern­ment will continue to take a long term, rational perspective. We will continue to be an international hub, open to global investments and talent. We will maintain sound economic policies that promote growth and improve Singaporeans’ lives.

Investors reassured, but they will also wait to see what we actually do. If over time they find that they are not as welcome as before, or our business environment gradually becomes less favourable, then they will take their business elsewhere and Singapore will lose out. But if we show consistently by our deeds that we understand what is at stake, i.e. theGovern­ment continues working effectively, with all agencies operating coherently to deliver results, the population continues to support consistent and rational policies which create jobs and prosperity, and Singa­pore keeps on improving the environment for global businesses, then we will continue attracting our share of investments and business, and Singa­pore’s position will be secure.

Conclusion

I congratulate EDB on half a century of success! Do not rest on your laurels. You continue to have an important role in our economic transformation. Never lose your pioneering spirit and far-sighted thinking. The Govern­ment, and Singa­pore, will back you all the way. I wish you every success in the next half century, as you continue to work to create a better tomorrow for all of us.