When it comes to the world’s economies, it seems the global focus is always on the US and China. The two largest economies in the world certainly attract the most news, especially in times like now, when the China US trade war has been dominating the news. As European economies slow and new markets emerge, there is one country that has been quietly slipping under the radar but whose growth has been outsripping the economies of much larger nations, with far more natural resources. That country is Singapore and if you don’t already know about the Singaporean economy, now is a good time to start.
Having gained independence from Malaysia in 1965, the tiny country of Singapore was faced with many economic problems. For a start, the country that is only 278.6 square miles and only the world’s 176th largest country, has almost no natural resources at all. So how did a tiny country, with no natural resources, and in the shadow of regional economic powerhouses like China and Japan, do so well?
Here are just some of the achievements of Singapore, a tiny country just over 50 years old, with no natural resources:
However, there is one achievement that is not listed there, which goes a long way to explaining Singapore’s success: Singapore is ranked number 1 in the world by the Organisation for Economic Co-operation and Development (OECD) for education.
When former British Prime Minister Tony Blair first campaigned for office, it was with the slogan “Education, education, education”. When Singapore broke free of Malaysian rule in 1965, the policy makers made a bold decision, that faced with no natural resources, the country had to invest in one resource – its people.
The country built a knowledge-based economy, investing heavily into education and placing great importance on the need for educating its children. Within just a couple of decades, the investment into education was getting results. Singapore become one of the four Asian Tigers, along with Hong Kong, South Korea and Taiwan. The Singaporean economy was growing at a consistent rate of over 7% and its schools were becoming internationally famous. To it’s credit, the Singapore government did not rest on its laurels, further investment into the Singapore economy, meant improved living standards, higher literacy and an education system that was quite literally second to none.
Education spending normally consists of approximately 20 percent of the country’s annual national budget which subsidises state education and government-assisted private education for Singaporean citizens. In 2018, $12.8 billion Singapore dollars will be spent educating its children by the government, but that’s just the tip of the iceberg. Private tutoring is massive business in Singapore. A 2008 poll found that an astonishing 97% of students received some sort of extra hours private tutoring. Economics tuition Singapore is ingrained within Singaporean culture. Intense A Level economics tuition has lead to Singapore having the best pass rate in the world. Also, Singapore has consistently been the world’s number one country in tests in reading, maths, and science since 2015. If you are looking at a reason for Singaporean success then look no further than its education and JC economics tuition.
Singapore has been at the forefront of the worldwide tech revolution for the last decade and its global tech expansion is projected to remain firm for the foreseeable future. Increased consumer spending and an ever improving labour market point to strong growth momentum domestically. Singapore has embraced the Bitcoin revolution. It was one of the first countries to have install Bitcoin vending machines and its crypto exchanges are some of the busiest in the world outside of the US.
At the moment, probably the biggest threat to continued Singapore economic growth is the China US trade war. Because of the strong industrial links between China and Singapore, the imposition of US tariffs on Chinese products would impact upon on Singapore’s gross domestic product (GDP). Singapore’s GDP is expected to be just above the middle of the forecast range of 1.5 per cent to 3.5 per cent. However, any escalation between the world’s two largest economies would have a negative effect, even though the central bank have assessed that the trade dispute would only have a limited effect.
Everything is in place for Singapore to continue in its upward trajectory. As not just a world leader in education, but THE world leader in education, the next generation of hard working educated tech graduates are already primed to take up the baton being passed over by the current generation. The government investment into both the private and public education system is ensuring continued success.
Singapore may face some interesting challenges socially, culturally and regionally, but economically it is fast morphing from a regional powerhouse, into a major player on the global economic stage.
Hutchison Port Holdings Trust (SGX: NS8U) – the container port operator.
Ascendas Real Estatement Investment Trust (SGX: A17U) – industrial group.
StarHub Ltd (SGX: CC3) – telecommunications giant.