The Singapore developmental state in the new economy and polity

Abstract

Good corporate governance has proved lacking in other Asian countries since the crisis in 1997. Economic reform, corporate and financial restructuring have been urged, cajoled and demanded by major international lenders and probably, too, to avert the next financial crisis. Singapore stands out without the profligacy of government spending, dubious government- business relations, cronyism, corruption and nepotism. Its formula of a committed developmental state and Singapore Inc. has delivered jobs, income, homes, education, security and welfare since 1959. This paper puts to question the resilience of this developmental state model in the globalized environment with information, communication technology (ICT), knowledge-based economy (KBE) and hyper-competition. Efficiency, effectiveness and deliverables may remain assured under Singapore Inc. which is being restructured even before 1997. The critical question is on the other side of the political economy. The same new economy trends impact on socio-political values, culture and behaviour as well. Can Singapore Inc. reinvent itself economically without concomitant political reforms and still meet the challenges of growing affluence, new political culture, democratization and impact of ICT on the society and polity? How much to deregulate politically to match economic deregulation and liberalization? How much more corporate governance and transparency in Singapore Inc.? Foreign economic policy has to be more sensitive when government-linked companies (GLCs) cross borders and interact in the political economy and social milieu in the region. The paper advances a number of scenarios for the Singapore developmental state and a ‘flow-through five-star Hotel Singapore’ with a loyal clientele seems a likely one.