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Analysis
Singapore can be capital city of the Asian century

Singapore can be capital city of the Asian century

Challenge and opportunity after Lee Kuan Yew's death 

by Kishore Mahbubani

Tue 24 Mar 2015

A sea of opportunities awaits the sturdy city-state of Singapore after Monday's death of Lee Kuan Yew, its first prime minister, undoubtedly one of the 20th century's greatest leaders. Just as London and New York were the capital cities of the European and American centuries, Singapore can serve as the capital city of the Asian century.

It has perhaps the best airport and seaport in the world. Its financial centre is poised to serve Asia's middle classes. Singapore is Asia's No.1 wealth management centre. The country has the best ranked university in Asia, the National University of Singapore.

Despite the withering criticism of the western media, world leaders respected Lee because he was a geopolitical genius. In his brutally candid manner, he would dissect the key global trends of the day and suggest wise courses of action. Vernon Walters, an American ambassador, once quipped: 'Thank God that Lee Kuan Yew is the leader of a small state; otherwise, [Richard] Nixon and [Leonid] Brezhnev would hug each other for comfort.'

Lee Kuan Yew transformed Singapore. He inherited a fledgling ex-British colony that apparently faced doom in 1965 after expulsion from Malaysia. Most expected Singapore to become a failed state. Yet, in less than 30 years, he took it (as the title of his book put it) 'from third world to first'. Starting in 1965 with a per-capita income the same as Ghana's, Singapore has become a rich economy that earns more, in proportion to the size of its population, than the UK.

He built strong institutions. People in the know respect Singapore's defence capabilities. The military can deploy up to 250,000 troops. The civil service, too, is a strength. Sir Michael Barber, the British government and education expert, has said: 'The Singapore civil service sets a standard of quality that in my experience is rarely matched.'

Lee Kuan Yew achieved this by pushing through a controversial scheme to retain first-rate minds in the public service by giving them high salaries comparable to those in the private sector. Singapore's exceptional record in education, healthcare and public housing is now being emulated.

Challenges remain. A big influx of foreigners into Singapore has generated anti-immigrant sentiment as public transport and housing failed to keep up with the surge. Inequality has grown. Hence the latest budget introduced some new social transfer measures; for example, schemes to share more of the benefits from economic growth with low and middle income households.

A geopolitical contest between America and China would put Singapore in a very awkward position, torn between its close defence ties with the US and ethnic affinity with China.

Singapore cannot afford to be complacent. This may be its biggest strength. Lee Kuan Yew's son Lee Hsien Loong, the prime minister, is fond of quoting the statement of former Intel chief executive Andy Grove: 'Only the paranoid survive.'

The leaders of Singapore are aware of the big lesson of history: small city-states rarely survive a century or more. Constant vigilance was a hallmark of Lee Kuan Yew's personality. It is the trait he has embedded in Singapore.

The writer is a professor at the National University of Singapore, a member of the OMFIF Advisory Board, and author of Can Singapore Survive?

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