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Dr Terence Lee
Singapore celebrated its 40th birthday on 9 August 2005 with the 'traditional' National Day Parade at the historic Padang, the vast open field fronting City Hall, the place where inaugural Prime Minister Lee Kuan Yew first declared Singapore's independence.
The month of August has become a celebratory month for Singaporeans, with fringe events such as carnivals, community-held parties, delivery of National Day speeches by Members of Parliament and the parading of the national flag island-wide designed to evoke patriotism and national pride amongst Singaporeans. This means that the month of August would typically be a 'good news' month, with negative reports about Singapore, particularly with regards to politics and the economy, if any, being either 'killed', postponed or downplayed.
The corollary is that positive news should be heightened such that political mileage can be exacted. This was precisely what happened this year. Lee Hsien Long, in his first National Day Message as Prime Minister, announced quite heartily that Singapore is on course to deliver better than expected economic data for the year 2005.
The economic growth forecast was revised slightly upwards to between 3.5 to 4.5 per cent instead of the earlier estimate of 2.5 to 4.5 per cent. To top it off, this range was labelled 'conservative' by local economists. It was also timely that American investment bank Morgan Stanley, previously critical of Singapore's economic policies, declared in early August that the government's economic strategies were starting to bear fruits.
There was, however, very little mention of a 'national scandal' involving the National Kidney Foundation (NKF) - Singapore's largest and most successful charitable organisation and one which caters to patients requiring kidney dialysis and treatment - that consumed the local news pages in July 2005. The scandal began with the NKF's lawsuit against The Straits Times over a report of how the organisation authorised expensive toilet renovation expenditure, and ended with, among other things, disclosures it had paid its CEO $1.8 million over three years and allowed him first class air travel.
This revelation sparked massive - and rarely seen - public outrage, which eventually led to the resignation of its CEO and the entire NKF board. The patron of NKF, Mrs Goh Chok Tong (the wife of former Prime Minister and now Senior Minister), also stepped down, although this occurred after she made an off-the-cuff public comment that the salary of the CEO was 'peanuts' for a person who runs a million-dollar charitable organisation.
Singapore's Health Minister Khaw Boon Wan was compelled to step in to resolve the issue and rebuild confidence in the NKF - and by extension other charitable organisations, which had begun to feel the impact of the NKF saga as Singaporeans 'protested' by holding back monetary donations. The minister moved quickly to appoint a new board and a well-regarded interim chairman, possibly alert to the fact that National Day was around the corner and therefore it was not expedient for anyone to be harping on the poor governance of an organisation that is highly exposed to the public glare.
For economic analysts and political critics, the NKF episode brought to the fore issues about governance, accountability and transparency in a government-made Singapore. On 19 July 2005, the opposition Singapore Democratic Party (SDP) took the opportunity to suggest that the lack of transparency and accountability exemplified by the NKF saga mirrored how the Singapore Government operated.
These issues are of course not new to those familiar with Singapore, with many experts and analysts consistently making these points, albeit in various forms and guises. Most recently, the 2004 Nobel economics laureate, Professor Edward Prescott, told audiences at the Singapore Economic Review Conference on 5 August 2005 that the key to Singapore staying on top is to embrace openness and economic integration, and for the government to stay out of managing retirement funds.
However, it appears that, for the time being, political talk about 'openness' will continue to be defined as attempts to remake Singapore into an vibrant, cosmopolitan and creative global city. As Lee Hsien Loong, who also 'celebrated' his first year in office on 12 August 2005, posited in his National Day speech: 'Global cities like London, Paris, New York and Shanghai are continuously remaking themselves, so all the more must we. This is the deeper reason, beyond attracting tourists, why we are developing integrated resorts'.
Behind the glossy public relations and (re)branding exercises, one thing is clear: as Singapore enters its fifth decade of existence, the economic challenges will 'deepen' and will require better management strategies.
WATCHPOINT: Although Singapore is likely to deliver reasonably strong economic growth this year, there is yet no evidence of consistency and sustainability, especially with escalating crude oil prices. Will the ever-increasing global oil prices derail Singapore's rosy economic outlook for the remainder of the year, and in the process, weaken the rationales and enthusiasm for a revitalised 'remaking Singapore' campaign?
About our company:
AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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