Unit 10

How did Singapore tackle Challenges in its Early Years of Independence?

Problems faced by Singapore

People of different races and religions living together. PAP sought to develop a national identity People were encouraged to work towards

the good of the nation and work to protect and defend their achievements.

Government work to build a stable economy, provide housing and education to the people.

Economic Problems

Singapore has no natural resources like tin, rubber or oil.

It depended on entrepot trade for the last century. By 1960s, more ports near Singapore were

developed and we faced stiff competition from them. They traded directly with other countries instead of

sending their goods to Singapore for re-export. Population had been growing and jobs had to be

created for the people. British forces were leaving Singapore. The people

who had been working in the British bases lost their jobs.

Steps taken to solve economic problems

Consulted Dr. Albert Winsemius, a Dutch economist. He recommended Singapore concentrate

on manufacturing of low-value products like clothes, textiles and toys.

New factories were set up in Jurong, Redhill and Tanglin. Factories were equipped with ready

supply of electricity and water.

Economic Development Board (EDB) was set up in Aug 1961.

To encourage American, Japanese and European companies to set up factories in Singapore.

Had branches in America, Japan and Europe to provide information and assist international companies to set up factories in Singapore.

Foreign companies were given tax holidays – did not have to pay taxes for a few years while they continued operations in Singapore.

Other roles of EDB

Helped small industries expand. Provided loans to new industries. Conducted studies on new types

of industries to be set up. To develop and manage industrial

estates. (Role was handed over to Jurong Town Corporation in 1968).

Support for industries Government continued to expand the

international airport at Paya Lebar in the 1960s so that it could handle more cargo and bigger aircrafts.

Port of Singapore Authority was set up in 1964 to supervise, manage and develop port operations.

Late 1960s, a container port was built to deal with container ships arriving from other countries.

Building the infrastructure Public Utilities Board (PUB) Established to

co-ordinate the supply of water, electricity and gas to the people in residential and industrial areas in Singapore.

Telecommunications were improved so people in Singapore could reach out to people overseas. This enabled business contacts overseas to be established.

Banking facilities of 35 major banks were improved. Money were lent to businesses to start new factories.

Communication betw workers and employers

Industrial Relations Ordinance 1960 Arbitration Courts to settle

disagreements. New labour laws were introduced to

ensure fair treatment of workers. National Trade Union Congress

(NTUC) formed. Government helped to set up market

for sale of goods produced in Spore.

Competition. What should we do? 1970s our competitors for low-value products were

HK, Taiwan & S Korea. We switched to producing high-value products like electronics industries that produced TV,

calculators, medical instruments and computer parts.

aircraft industry that produced aircraft parts and components.

oil rig industries that built oil rigs. Workers needed very specialised skills to produce

these high-value products. Companies with technical know-how were encouraged to provide training to the workers. They were given tax holidays and other financial incentives in return.

Education New schools and vocational institutes

were set up to provide education and technical training.

Training institutes were jointly set up by the government and international companies. For example, the French-Singapore Institute and German-Singapore Institute.

The Polytechnics, National University of Singapore and Nanyang Technological University were expanded to provide training for technicians and engineers.

Jurong Industrial Estate (JIE) July 1960 Minister of Finance, Goh Keng

Swee introduced an idea of developing Jurong as an industrial estate. Located away from any built-up area and close

to Malaysia, our hinterland. Deep water that is suitable for building a

harbour. Was an area of jungles, swamp and old rubber

estates as well as a small fishing village. Communication lines were laid. Roads, railway tracks and a network of

telephone lines, a power station and a reservoir were constructed.

JIE - Continuation Jurong had own port with wharves and modern

facilities so that ships from overseas could bring in raw materials and manufactured goods could be exported.

1963 The National Iron and Steel Mills was the first factory to be set up in Jurong. Soon more factories followed.

1967 1st phase of development was completed. 1968 there were 300 factories and 21,000

workers in Jurong. Factories in Jurong produced clothes, textiles, toys, woods products and beverages.

JIE – Continuation II Jurong grew fast in the first 2 decades. It became one of the largest industrial

estates in Asia. End 1970 Jurong had 1400 factories,

providing jobs for 112 000 workers. By 1968 JIE and other industrial estates

came under newly formed Jurong Town Corporation(JTC).

JTC developed Kallang basin, Sims Avenue and Redhill which are near residential areas.

External Developments and effects on Singapore

1960s world trade was flourishing and most international companies were willing to invest in Singapore. Our economy grew.

1970s rise of oil prices affected world economy. This resulted in world-wide recession. Singapore was able to pull through because of the hard work of the people and it had a strong economic foundation.

Reasons for Our Success in building a Strong Economy

Geographical position Located at the meeting points of the east and

the west. Contribution of leaders in Singapore

Leaders were far sighted and made careful decisions.

Contribution of older generation in Singapore Hardworking, disciplined and willing to work

together.