Lessons from southeast Asia - The Good Oil by Rod Brown
Escaping the freezing winter is a serious pastime for Canberrans, so I headed to south-east Asia in June for some sun and a yarn with the locals.
First stop was Singapore where I caught up with an old mate from university days. He’s been there a decade, so over a few beers he provided some insights into Singapore’s approach to economic development.
His main point was that the Government never stops pushing the boundaries, leveraging its competitive advantages, and growing – its GDP has grown at 6.8 percent annually over the last 40 years!
He exampled a recent report (‘Report of the Committee on the Future Economy’) engineered by the ministers for Finance and Trade and Industry.
I googled it later and it’s bold, uncompromising stuff.
It identifies seven key sectors that will provide the platform for future growth - finance, hub services, logistics, urban solutions, healthcare, the digital economy, and advanced manufacturing. It then lays out the game plan as follows:
- Make it easier for venture capital (VC) firms to operate in Singapore (e.g. simplify the regulatory framework for VCs) and encourage more private equity firms to set up shop there.
- Embrace new technologies. Uber and Grab are seen as examples of technology companies supplanting old industries. Artificial intelligence, robotics, logistics, retail, and healthcare are industries that will birth new dynamic companies.
- Equip Singaporeans with the necessary skills for tomorrow’s job market.
- Urge Singaporean universities and companies to collaborate via global innovation hubs and ‘innovation launch pads’.
- Bring outside knowledge and expertise to the country. Keeping international connections alive and cross-border markets open is vital to the city-state’s economy.
The point my mate rammed home as the night progressed was that Singaporeans, and the governments that represent them, are incredibly proactive and outcomes-focused.
The key architect was the late Prime Minister Lee Kuan Yew, a grand thinker with a passion to make things work, whether it involved the city-state’s foreign policy, its economic policy settings or urban development projects.
His approach has continued to this day viz. the best airport in the world, a classy railway system, great roads, gazelle-like companies, and strong social justice and environmental policies.
Not surprisingly, Singaporeans host numerous trade and investment missions from other nations looking to emulate them.
Is there a lesson for Australia? While Singapore’s 17 percent corporate tax rate is a carrot for investors, its continuing success in building on its competitive advantages is the stand-out lesson.
It arguably stems from an accommodating, cooperative population and an unashamed ability to market themselves. For example, few people realise that its economy is smaller than Victoria’s!
Raffles Hotel in Singapore is the home of the Singapore Sling – gin, Cointreau, cherry brandy, pineapple juice etc. But we found that the huge old pub has been closed for renovations since last December.
There is a however a pop-up bar complete with a turbaned doorman. Unfortunately the place is empty of customers because the bean counters are asking $40 for the beverage.
Surely someone can explain the price elasticity of demand principle to them?
The Singapore dollar is line-ball with $A these days – it wasn’t so long ago that our dollar was worth 5 Singapore dollars. My daughter tells me that a friend in Singapore pays $100 for a pedicure.
Phuket’s environmental problem
Thailand’s biggest island, Phuket, is hugely popular with Aussies – sadly many of them are ageing bogans in singlets, showing off tattoos and pot guts. I don’t think I came across any lady boys there, but one does marvel at the fantastic beaches which are unhindered by sharks, crocodiles or stingers.
But the receding tide leaves a sorry swathe of plastic bottles and bags, food containers, granulised plastic, straws, cartons, ropes etc. It is a truly tragic sight. The locals say the rubbish is washed out of the rivers of the Indian subcontinent under the influence of the monsoons, but I figure the locals aren’t blameless.
Thai authorities need to step up because every damned thing you buy comes in a plastic bag, and soft drinks are invariably served with a straw.
Given that local councils in Australia are now banning straws and working with the states to ban plastic bags, we could possibly mentor the Thais, Indians etc. in this field.
It’s mainly about getting public administrators in developing nations to pick up on environmental policies that are working elsewhere.
For example, beverage container deposit arrangements, which have worked wonderfully in South Australia for 40 years, could be the answer. A side benefit is the income it would create for the unemployed collecting empty bottles. Similarly, paper bags could surely make a comeback – they were de rigueur back in the Aussie supermarkets of the 1960s.
Could a pitch be made to the United Nations Environment Program for certain Australian councils and states to drive a big international effort in this whole field?
If you don’t, the Singaporeans might.
Thai work ethic
I heard from a number of sources that the Thais are very laid-back. Accordingly some business operators prefer to employ Nepalese, who’ve been in Thailand in reasonable numbers since the middle of the last century.
But Nepal’s neighbour is Tibet? So why does its favourite son, the Dalai Lama, seem to side with those on the slow boat? Anyway below is his famous quote, which makes eminent sense.
“Man sacrifices his health in order to make money. Then he sacrifices money to recuperate his health. And then he is so anxious about the future that he does not enjoy the present; the result being that he does not live in the present or the future. He lives as if he is never going to die, and then he dies having never really lived.”
Rod Brown is a Canberra-based consultant and lobbyist specialising in industry/regional development, investment attraction and clusters, and accessing federal grants. He also runs the Cockatoo Network.
Phone: (02) 6231 7261 or 0412 922 559
Email: [email protected]