Since it became an independent nation 50 years ago, the island of Singapore has been hailed as nothing short of an economic miracle, and this sophisticated and wealthy nation is often compared to Switzerland for a multitude of reasons, including security and prosperity, its ability to attract foreign investment and channel that into improving the standard of living of its citizens, and, more recently, for being a major hub for private banking.
But in the last few years, Singapore’s successful model of economic growth has started to show some signs of stress and has resulted in gaps that, if not addressed properly, could perhaps make growth much more challenging in the years to come.
One of the greatest issues that Singapore faces is that of an aging population combined with low birth rates—a problem that affects the economy in a number of ways. Singapore’s government has tried to counter the issue by upping immigration quotas, however, that policy has proved unpopular and it’s also brought to light gaping social and economic inequalities that would prove negative to growth and dynamic business. The arguably authoritarian nature of the Singaporean regime is also a cause for increased concern and discontent in a number of factions.
All the same, the Singaporean government has a strong track record and investors believe it’s capable of the right kind of planning to remain a leading economy for the next 50 years.
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Sustainable Singapore: A Blueprint for the Future
The Singapore government’s Sustainable Singapore Blueprint is one of the most significant undertakings for the future of the island, not only because it aims to create a cleaner, greener future Singapore, but because it has also attracted some of the largest global companies in the field of sustainability to test out their products and services.
Singapore has always been open to new business and to innovation, and “the small, multi-cultural market of sophisticated and affluent consumers also allows companies to try products, services and approaches before rolling them out to larger Asian countries,” said Rajeev De Mello, head of Asian fixed income at Schroders in Singapore.
Singapore has also positioned itself as a knowledge economy – a wise move, said Carol Pepper, CEO and founder of Pepper International, since it is “a tiny country without a large amount of natural resources.”
In April 2014, the Singapore government invested significantly in several early-stage technology venture capital funds in Singapore, to continue to stimulate early stage tech investing. The continued support for and focus on technology, as well as on other sectors like biotech, will continue to attract new investment and help Singapore’s economy to grow, Pepper said. Valuations are attractive