Singapore: The Hyphen Connecting the World to Asia

Straits Times |

By Parag Khanna

With the recent Singapore Summit, the “Little Red Dot” has really proven its out-sized role and importance on the world stage. As one participant remarked, never has such a large market capitalization been assembled in one room. Having participated in the full Summit, some observations stood out as points that demonstrate Singapore’s unique position and potential contributions to the world in the decade ahead.

Prime Minister Lee Hsien Loong delivered the kind of confidently tech savvy speech unimaginable from any other head of state, even the Blackberry wielding Barack Obama. He didn’t just name-drop robotics companies, the online learning portal Coursera, and our increasingly social relationships with digital avatars, but used these to highlight the “ruthless competition” Singapore’s workers will face as technologies accelerate, rise up the value chain, and displace even white-collar labor. As World Trade Organization (WTO) director general Pascal Lamy pointed out, the “gravity of proximity” is weakening in both goods and services. Asia will have to defend its gains while innovating more to maintain growth.

The theme of “Global-Asia,” then, has to be viewed not only as a two-way street, but also a brave and uncertain new world order to which Singapore must rapidly adapt. Asia has benefited from the most recent wave of globalization as a destination for investment capital and raw materials, with finished goods exported in the reverse direction. In globalization’s next phase, Asia’s trillions of dollars in savings and sovereign wealth will increasingly reshape global financial flows as they seek strategic commercial alliances and diversify currencies away from low-yield Western treasuries towards high-growth debt and equity opportunities in fellow emerging and frontier economies from Latin America to Africa and the Middle East.

Yet economic and technological disruptions will surely dampen any straight-line projections of Asia’s global ascendance. America’s edge in 3D manufacturing and the rise of many high-tech, export oriented jobs to the U.S., combined with the exploitation of shale gas and strengthening of a Western hemispheric alliance, means that the West potentially has a resurgent future – one that those focused purely on the current situation with America’s twin deficits and the moribund Eurozone all too eagerly neglect.

Seen in this light, Singapore has to continue to be diplomatically neutral and economically opportunistic. It must position itself ever more as the filter into Asia for global investment, particularly as interest in hedging China grows through greater exposure to Southeast Asia, and the conduit for outbound Asian capital seeking international partnerships. Singapore, then, is the hyphen in the “Global-Asia” formula. Recent years have witnessed how cleverly Singapore has drafted off Switzerland – the only country ranked higher in this year’s World Economic Forum Global Competitiveness Report rankings – luring private banking, commodities trading, hedge funds, and other industries to Asia. It has even become home to the largest overseas presence of Switzerland’s leading university ETH, whose Future Cities Laboratory employs over one hundred researchers to apply advanced data analytics to Singapore natural environment and social eco-system, mapping everything from noise pollution to parking patterns.

Furthermore, as Hong Kong loses its luster as an independent entrepot, Singapore provides the ideal setting for diplomats, investors, and thought leaders to convene in the city-state that is increasingly viewed as a role model of good governance and future ready urbanization. Because Asia is neither coherent nor united, the region needs a venue for strategic dialogue that is both inclusive and oriented towards building a stable regional order. Singapore has played this role for over a decade in the defense arena as host of the IISS Shangri-La Dialogue, and is now home to a growing presence of multilateral organizations such as the World Bank. Such trends, as well as the Singapore Summit itself, represent Singapore’s more confident shift into a new role as the unofficial capital of Asia.

As the global economy cools while tensions heat up in maritime Asia, Singapore cannot afford to be complacent. The elegant Indian executive Anand Mahindra reminded the audience that no government in the world appears to have as much freedom to maneuver imaginatively as Singapore’s, investing in the kinds of innovations that will define the future, from zero-emissions districts to under-sea settlements. According to the Economist, Singapore now ranks behind only New York and London in its dynamism and livability.

And yet, Singapore must be more than a smart city-state: it must become the world’s foremost info¬-state, a polity that provides world-class security coupled with world-class connectedness. This must apply not just to the financial sector and elites, but the entire population who deserve the opportunity to acquire relevant technological skills and convert them into entrepreneurial activity. Only then will Singapore’s economic footprint continue to expand well beyond its geographic one.

The goals that Singapore has set for itself in terms of economic diversification and expanding exports in areas such as professional services, urban development, bio-medical devices, and digital media will require that Singapore become not just a smart city, but home to the world’s smartest city-zens. This hints at an equally important aspect of the info-state: real-time governance. As Singapore’s democratic politics make day-to-day policies less predictable, this must not outweigh the equally important trend of harnessing data around zones of economic need and social tension, enabling rapid feedback loops to policy-makers and swift responses that strengthen and empower society. As Eric Li, the exuberant Shanghai entrepreneur, emphasized in the opening panel, what will matter more in the 21st century is not whether a nation is democratic or not, but whether it is well governed or poorly governed.

As Singapore becomes ever more an Asian melting pot and a microcosm of the world’s economic, demographic, technological, and cultural trends, it will have to work even harder to set the standard for Asia and beyond.

Click to download PDF

Stay Tuned for Updates

Your subscription could not be saved. Please try again.
Your subscription has been successful.
We will never share your email with anyone.