Global macro economics project report


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Global macro economics project report

  1. 1. GLOBAL MACRO ECONOMICS REPORT ON SINGAPORE SUBMITTED TO: SUBMITTED BY: Ms. Rakhi Singh AkanshaAggarwal, PG20121398 Ms. NidhiPiplani AkshunGirdhar, PG20121651 Ms. RachnaMadan Apurva Singh, PG20121122 IshanShandilay, PG20121001 KashishPamnani, PG20121250 KeertiWadhawan, Pg20121398 PriyankaBhandari, PG20121531 (LODHI ROAD CAMPUS)
  2. 2. SINGAPORE Inhabitants of the Malaysian peninsula and the island of Singapore first migrated to the area between 2500 and 1500 B.C.British and Dutch interest in the region grew with the spice trade. The trading post of Singapore was founded in 1819 by Sir Stamford Raffles. The name Singapore comes from the Malay words ―Singa‖ for lion and ―Pura‖ for city. During World War II, Singapore was occupied by the Japanese. It was considered as the worst disaster and largest capitulation in the British history. The country faced staggering problems of high unemployment, slow economic growth, inadequate housing, decaying infrastructure, labor strikes and social unrest. In 1959, Singapore became a self-governing state within the British Empire. Lee Kuan Yew became the Prime Minister of Singapore. Singapore is located in southern East Asia due to which the climate of Singapore is hot & humid. It consists of the island of Singapore and some 63 islets within its territorial waters. Singapore is one of the busiest seaports in the world. The famous places of Singapore are the Benjamin Sheares Bridge on the East Coast Parkway, which links the airport to the city center. Orchard Road, the shoppers' haven, is located in the northern part of the city center. In Singapore people follow different religion. Each racial group has its own distinctive religion and there are colorful festivals of special significance celebrated every year. Singapore offer different culture and variety of food like Chinese, Indian, Malay, Indonesian and Western, Italian, Spanish, French, Thai and even Fusion. Indian food is relatively spicier, whereas Chinese food is less spicy and the Chinese enjoy seafood. Malay cooking uses coconut milk as their main ingredient that makes their food very tasty. Most Singaporeans celebrate the major festivals associated with their respective religions. The Chinese are followers of Buddhism, Taoism, Christians, Catholics and some considered as 'free-thinkers'. Malays have the Muslims and Indians are Hindus. The four official languages of Singapore are Mandarin, Malay, Tamil and English. English is the most common language used and is the language which unites the different ethnic groups. Children are taught in English at school but also learn their mother tongue to make sure they don't lose contact with their traditions. Many Singaporeans use Singlish to communicate. Singlish is a mix of English with other languages mixed into the English. Speakers of Singlish usually end their sentence with a distinctive exclamation like ah, lah, ley and what. After facing lot of hindrances the Singaporean government was aggressive in promoting export-oriented, labor-extensive industrialization through a program of incentives to attract foreign investment. By 1972, one-quarter of Singapore’s manufacturing firms were either foreign-owned or joint-venture companies, and both USA and Japan were major investors. As a result of Singapore’s steady political climate, favorable investment conditions and the rapid expansion of the world economy from 1965 to 1973, the country’s Gross Domestic Product (GDP) experienced annual double-digit growth. With the economic boom of the late 1960s and 1970s, new jobs were created in the private sector. The government provision of subsidized housing, education, health services and public transportation generated new jobs in the public sector. By the late 1970s, the government changed its strategic focus to skill and technologyintensive, high value-added industries and away from labor-intensive manufacturing. As a result information technology was given priority for expansion and Singapore became the world’s largest producer of disk drives and disk drive parts in 1989. In the same year, 30 percent of the country’s GDP was due to earnings from manufacturing. Singapore’s international and financial services sector still is one of the fastest growing sectors of its economy contributing 25 percent of the country’s GDP in the late 1980s. In the same year, Singapore ranked with Hong Kong as the two most important Asian financial centers after Tokyo. By 1990, Singapore became the host country to more than 650 multinational companies and several thousand financial institutions and trading firms.
  3. 3. Economic Condition of Singapore It is the most open and competitive economy in the world. World Bank has given best business index in the world. International monetary fund central intelligence agency and university of Pennsylvania had given 3rd rank,5th rank and 5th rank respectively. It is an industrialized country since 1960. From 1960 to 1980 it was closed economy. There was more of domestic production. But after that, country was able to attract numerous of multi nation companies and foreign direct investment. In 2010 Singapore was fastest growing economy in the world, with GDP 14.47%. The economy of Singapore is a mixed economy. Although country have free market polices, even government intervention is very high. This is an example of innovative and highly successful economic system, where state and market have equally strong in economy. This model is was adopt due some reasons. The country has small domestic market and if they need to stay in the market then in that case they need to open up to the world. Today Singapore is now mostly depended on balance of payments that is import and export. Apart from this export and import policies government is also inviting new industries to set up in their country. Many people call Singapore as Singapore Inc. where country looks like more of corporate then a nation. They have proved them in global slowdown. In world crisis of 2008 the economy of Singapore was rising at a steady speed it is only country in Asia which get AAA credit rating by all major credit rating agencies. It is the second freest economy in the world. To start business in Singapore it just takes 2 days as compare to 35 days in the world. It has large natural seaport and good geographical position. Singapore has 2.7 million labor forces. There are only 2.2% of unemployment which very low. They have lowest unemployment in the world. In 1990’s they were facing shortage of labor shortage. The reason is this because there was only 8.5 birth/1000 population that is 0.81 % of population annual growth. So to keep this thing in mind government has starting allowing immigrants and expatriates to live and work in Singapore. Bing a small country they have high foreign worker. In 2010 0.1 % labor are in agriculture sector, 30.2 % in industry and 69.7% in service sector. As they have maximum population in service sector so they have one of the busiest ports in the word. From 2000 they have GDP of 21647 million dollar to 50123 million dollar in 2011. The major industries which are attracted by Singapore are pharmaceuticals, medical and technological production. International trade is important for Singapore as there are hardly any natural resources with them. A large number of trades are conducted to meet domestic demands such as energy, food, and other necessities.47% of export consist of re-export. Reexport is when raw material is imported and processes it then export it. Singapore is 14th largest exporter in world and 15th largest importer in world. According to WTO Singapore has highest trade to GDP ratio in the world at 407.9%. They have export of US$315.2 billion. They are also partner with most favored nation having 0 tariff rates applicable to their product. This is because they relatively low barriers to trade off. From 2009 GDP growth of Singapore is growing at 15.56%. They have 3rd highest GDP per capita income in the world that is US$56521. They have most skilled labor in the world. The GDP (PPP) is rising at 3.94%. In 2011 inflation in Singapore is 3.33% which quite low. They have 8th largest current balance in the world for 2011 at US$49.454 billion. As far as energy and infrastructure is concern the oil industry make up to 5% of GDP. This country is one of the 3rd largest export refilling centers. Singapore also has 20% of ship repairs in world share. There is major employment is generation source for them. There are 70000 worker employed in this industry.
  4. 4. Preliminary estimate shows that the Singapore economy has grew by 0.3 % every year. In third quarter of 2012 the percentage increased by 2.5% as compared to last quarter. The pullback of this percentage is dependent on manufacturing and wholesale trade. Manufacturing sector has expanded by 9.6% in last 2 quarter. The expansion is possible due to electronic manufacturing clusters. The construction sector grew by 7.7% on a year basis as compare to 12.3 in last quarter. This is due to short fall in private sector activities. The wholesale and retail is expended by 0.5% on yearly basis. Since last year there is 7.8% decline in this sector. But it has shown better result if it is compare to last quarter. The finance and insurance sector have contracted by 2.7% on yearly basis. On a quarterly basis there is 4.6% decline in reflecting sluggish activity in the forex trading and insurance segments. But the growth of service sector is 3.8% on yearly basis. On year on year basis accommodation and food service sector is growing by 2% from 2.9% in preceding quarter. In 2012 Singapore economy has grown around 2 to 1.5%. The growth may be slightly lower than forecast, if the weakness in the externally-oriented sector persists into the final quarter of 2012.Performance by cluster that is on the basis of industries. Output of the transport engineering cluster grew 16.1% on a year-on-year basis in September 2012, supported by higher output across all segments. The aerospace segment expanded 20.5% on the back of new production capacity, and the marine & offshore engineering segment rose 11.4% with higher contributions from rig building activities and the production of oilfield equipment components. The precision engineering cluster’s output increased 1.9% year-on-year in September 2012. Growth was supported by the machinery & systems segment which grew 4.7%. The segment saw higher output of lifting and handling equipment, including industrial automation systems, and lifts & escalators. On the other hand, the precision modules & components segment fell 1.3%, on account of lower output of electronic connectors and industrial & mechanical rubber goods. On a year-to-date basis, output of the precision engineering cluster grew 2.0%, compared to the same period a year ago. Output of the general manufacturing cluster was unchanged in September 2012 compared to the same period a year ago. Higher output in the miscellaneous industries (4.0%) and food, beverages & tobacco (1.3%) segments were offset by lower printing output (-10.3%). Output growth in the miscellaneous industries segment was supported by higher production of batteries and construction related products such as concrete and structural metal components. Cumulatively, the general manufacturing cluster’s output grew 2.4% from January to September, compared to the same period last year. The chemicals cluster’s output fell slightly by 0.2% in September 2012 on a year-on-year basis. The petrochemicals and other chemicals segments rose 8.3% and 1.1%, respectively. However, the specialty chemicals segment declined 2.0% on the back of weak regional demand, and the petroleum segment contracted 11.1% due to maintenance shutdowns. Output of the biomedical manufacturing cluster declined 6.9% on a year-on-year basis in September 2012. The medical technology segment increased 4.4%, but the pharmaceuticals segment fell 8.9% due to a different mix of active pharmaceutical ingredients being produced. On a year-to-date basis, output of the biomedical manufacturing cluster was 16.5% higher, compared to the same period a year ago. The electronics cluster’s output contracted 12.2% in September 2012 compared to the same period a year ago. Most segments in the cluster registered declines, as world electronics demand remained weak in the face of global economic uncertainties. On a cumulative basis, output of the cluster in the first nine months of 2012 fell 12.0%, compared to the same period in 2011.
  5. 5. Business opportunities and environmental prospects Singapore is a cosmopolitan city that provides a platform for global talents, ideas, funds and businesses to meet. Singapore's skilled workforce and strategic business location offers a globally connected, business environment that helps boost and sustain growth and success across a range of industries. This is the reason why many companies have considered Singapore as a home country for their business to start. Singapore's business environment Singapore is an attractive location for multinational companies and small and medium enterprises to invest and grow their businesses. Many companies have chosen Singapore as the start of their business and spread their branches across Asian market. It is considered as one of the best politically stabled country for the business environment. The labor force available is considered best in the world. Singapore provides quality of life in Asia. Corporate tax rates are about 8.5% up to $300K profits and a flat 17% above that. Singapore’s political system is one that enacts laws, decides priorities and sets regulations using a rational, pro-business approach. Singapore has a stable government, who work to keep the nation to the front of the industrialized nations. Singapore has built an attractive, world-class, and productive work-force – a key ingredient for the success of any business. Since the country is primarily a knowledgebased economy, its manpower force is educated and professionally qualified. Singapore’s workforce is recognized for its high level of education, high productivity, and technical proficiency, work-hard and work-smart culture. Employment opportunities A growing number of multinationals have chosen Singapore as a base of regional operations. More than 7,000 multinational companies operate in Southeast Asia. Singaporeans have been working hard to transform the former British colony into a prosperous independent state and a regional center of the finance, trade and high-tech industries. People working in Singapore are contributing to the economic development in the country. After two years of negative growth during the global crisis, the city returned to the economic stage as the world´s fastest-growing economy in 2010. It provides a stable base for international companies that want to expand into the Asian market. Singapore has a highly developed, knowledge-based economy focusing on export as well as refining imported goods. Most people working in Singapore are employed in one of the main industries, including electronics, oil and gas, financial services, shipping and chemicals. Medical and IT professionals are in high demand.
  6. 6. Working conditions and lifestyle Singapore is a safe, modern city, where English is widely spoken. The relationship between employer and employee in Singapore is regulated by the contract of employment between them. The Singapore Employment Act does not apply to all employees. It applies only to ―employees‖ as defined under the Act. The Employment Act does not apply to: Managerial & Executive Positions: Such position is defined as one where a person has direct authority or influence in the hiring, firing, promotion, transfer, reward or discipline of other employees; or the main duties involve management and running of the business. It is also applicable to professionals who carry out the same or similar responsibilities as managers or executives. Examples of such professionals include lawyers, accountants, dentists, and doctors. Domestic Workers Seamen Most of the Government Staff Employment Contract is also known as Employment Agreement. It is an agreement between an employee and employer that specifies the terms and conditions of employment. It is advisable to have a written employment contract in Singapore. A violation of one or more of the terms in an employment contract by either an employee or employer is considered breach of contract. Employee benefits in Singapore include sick leave, annual leave, maternity leave, incentives & bonuses, relocation assistance; healthcare benefits, retirement fund contributions, housing allowance, allowance for children’s education, childcare benefits, transportation reimbursements, etc. Either party can terminate the employment contract by giving a written notice or by paying salary in lieu of notice to the other party. There is no statutory requirement on the number of days for the notice period. The notice period depends on what is agreed upon in the employment contract and must be the same for both parties. The employee is allowed to use his/her accrued annual leave to offset the notice period. The employment contract can be terminated by either party without notice if the other party is in willful breach of the contract. Lifestyle People are fond of shopping. There are many malls where expensive & high brands are available. The prices are double that in UK & USA. But some street markets are also available where you will get affordable things within your budget. Apart from shopping options, malls in Singapore include arcades, movie theaters, restaurants, bars, salons, and even pet parks and an ice skating rink. People sometimes start their night as early as directly after work, a prime time to take advantage of happy hour prices. Food is a big part of Singaporean culture. Work permits Foreign professionals, managers, executives and entrepreneurs who wish to work in Singapore need to apply for a work pass. Working in a foreign country requires a work permit or visa. In Singapore, your monthly salary determines whether you need to apply for an Employment Pass or a Work Visa. Employment Passes are meant for professionals who make more than $2,800 a month and Work Visas for
  7. 7. those who make less than that amount.Each Employment Pass can be valid for 1 or 2 years, and is renewable so long that the pass holder remains employed in the company. The Entrepreneur Pass is a visa that permits foreigners to work and stay in Singapore for a period of up to 1 year. This visa is most suitable for foreign entrepreneurs who intend to establish new businesses in Singapore. PEST Analysis of Singapore Political: In Singapore, the state has taken on the role of promoter and practitioner of Corporate Social Responsibility, a logical development in view of the dominant role of the government in the local economy. The Economic Development Board Act exists to stimulate the growth, expansion and development of Singapore’s economy. A good example of the role the Singapore government has played in fostering economic growth is the Changi airport and the Singapore Airlines. The Singapore government investment and holding company, Temasek Holdings is the majority shareholder with 54% shareholding of the Singapore Airlines. However, the Singapore government has regularly stressed its non-involvement in the management of the company. The Singapore government also owns Changi Airport that was developed in 1975 to replace the PayaLebar Airport. Both of these enterprises have become enormously successfully and are a good example of the thoughtful and forward-looking economic policies promoted by the Singapore government. Singapore is an enterprise friendly country. The government has set ups several organizations in helping the business in a very systematic way: Regulation Structure (a)Ministry of Trade and Industry (MTI): It’smission is to make Singapore a leading global city of talent, enterprise and innovation. Its mission is to promote economic growth and create jobs, so as to achieve higher standards of living for all. The vision of the Ministry of Trade and Industry is to turn Singapore into a leading global city of talent, enterprise and innovation. Its vision is further elaborated through a sub-vision: A Globalized, Entrepreneurial and Diversified Economy. To realize the MTI's vision of Singapore as a leading global city — a hub in the new Asian and global economic network and an entrepreneurial and diversified economy — the Economic Review Committee (ERC) identified six key areas which are critical: External ties Competitiveness and flexibility Entrepreneurship and Singapore companies Twin engines: manufacturing and services People Restructuring According to MTI, Singapore needs to embrace globalization, and continue linking ourselves to the developed economies, to attract investment and expand its markets. Investors should be offered that extra plus, in terms of superior capabilities and an efficient and flexible business environment.
  8. 8. (b) Ministry of Finance (MOF): The Ministry of Finance, is a ministry of the Government of Singapore responsible for administering and regulating financial institutions and structures of the economy of Singapore. It is headed by the Minister for Finance. The authority's main regulatory statutes are Accountants Act, Accounting Standards Partnerships Act, Business Registration Act, Companies Act and Limited Partnerships Act and the Limited Liability Partnerships Act. Guidelines and rules are constantly reviewed to ensure they remain relevant to the business and financial environment and are done in close consultation with industry experts and key stakeholders. The MOF functions within the government to ensure that businesses operating within Singapore's jurisdiction are compatible with international standards and practices, in areas such as company law, accounting standards and corporate governance principles. (c) Government E-Business Portal In an effort to promote transparency, the Singapore government has setup GeBIZ (Government EBusiness Portal) who is the Singapore government's one-stop e-procurement portal. All the public sector's invitations for quotations and tenders are posted on GeBIZ. Economy: Singapore has a highly developed and successful free-market,state capitalist economy, where the state owns stakes in firms that comprise perhaps 60% of the GDP through entities such as the sovereign wealth fund Temasek. It has an open, pro-business environment,relatively corruption-free and transparent, stable prices, low tax rates (14.2% of GDP) compared to other developed economies,and one of the highest percapita gross domestic products (GDP) in the world. Its innovative yet steadfast form of economics that combines economic planning of Singapore Economic Development Board with free-market has given it the nickname the Singapore Model. Exports, particularly in electronics and chemicals, and services including the posture that Singapore is the regional hub for wealth management (and the opening of the city state's first casino in 2010 provide the main source of revenue for the economy, which allows it to purchase natural resources and raw goods which it does not have. The per-capita income of the country is the highest in ASEAN. The business sector has been supported and strengthened by a corruption-free environment, an educated and motivated workforce, and wellestablished legal and financial business framework. In recent years, the Singapore government has invested heavily in diversifying the economy. This has led to growth in the tourism industry, the pharmaceutical industry with a particular focus on biotechnology, financial services, business consultation services, education, multimedia, retail and leisure, and the medical technology industry. Banking Singapore is a financial center in Southeast Asia. According to the Human Rights Watch, due to its role as a financial hub for the region, Singapore has continually been criticized for reportedly hosting bank accounts containing ill-gotten gains of corrupt leaders and their associates, including billions of dollars of Burma’s state gas revenues hidden from national accounts.
  9. 9. Taxation Singapore introduced Goods and Services Tax (GST) with an initial rate of 3% on 1 April 1994, increasing government's revenue by S$1.6 billion (US$1b, €800m) and establishing government finances Singapore attracts entrepreneurs, and established corporations from around the world, with a corporate tax structure that encourages startups and provides incentives for international business. The corporate tax rate of 17% is low relative to other developed nations. Fiscal Policy: The main focus of the Government's expenditure is on the delivery of essential public goods and services to Singaporean. The Government spends to assure the nation of a secure future. Therefore, key areas of expenditure are on education, public housing, health care and national security. The Government is also committed to building and maintaining world-class economic infrastructure and services. This is evidenced by the fact that development expenditure accounted for around one-third of government expenditure on average over the last three decades. Social and cultural: Singapore is an eastern country who still follows the traditional family values, but the younger generation has started to adapt to western culture and values. 1. Society Values and Principles As nowadays, many Singaporean have the mindset of ―Kia-su‖ which means afraid of lose out to others. Many Singaporean works very hard to retain or fulfill their materialism desire. In some extent this has positively increased the nation productivities and the business sectors can expect a higher purchasing power from the consumers. On the other hand, some family and social values have to be sidelined. 2. Demographic Profile The current population is about 5.3 million. Singapore ethnic mix is: Chinese 76.8%, Malay 13.9%, Indian 7.9%, other 1.4% (2000 census). Most of the Singaporean dislikes blue collar works like construction and other works in hard environment. 3. Education The Singapore government's education policy, seeks to provide children with a "balanced and wellrounded education" to develop them to their "full potential", and hence nurture them into good citizens who are responsible to the family, society and country. This policy also helps to fill societal roles by nurturing students to take up positions such as businessmen and statesmen. According to the system, students in Singapore generally undergo six years in primary school and four to five years in secondary school. They can then enroll in post-secondary institutions, pre-university courses, or move on to the polytechnics. Eligible students are subsequently given the opportunity to enroll in the universities.
  10. 10. TECHNOLOGY Technology is the power behind to change our life style and improve out quality of life. The Internet: Comprehensive infrastructure setup has been a fundamental attractiveness for foreign investment and local business establishment, not to mention about the IT infrastructure. Currently, the household broadband internet penetration rate has achieved more than 70%. The successive of e-commerce and eB2Cmodel are highly relies on the broadband internet. For the development of its network, Singapore is relying on a mixture of public subsidies and privatesector participation and separating three main functions: the building of the infrastructure, the operation of the network and the provision of retail services. Telecommunications Telecommunications Singapore offers a world-class telecommunications infrastructure, and its endeavor to wire up every citizen to the information highway is taking shape. Singapore is not only the most wired country in the world, with a household broadband penetration rate of 157.9% (Infocom Development Authority, Mar 2010) it is also the world leader in terms of ICT utilization. (Japanese Ministry of Internal Affairs and Communications, 2009) According to a survey by the International Telecommunication Union (ITU), Singapore ties with the US as the cheapest place in the world to make a phone call or surf the internet using a broadband connection. The Internet There is a comprehensive infrastructure setup which has attracted foreign investment and local business establishment, and also the IT infrastructure. Currently, the household broadband internet penetration rate has achieved more than 70%. The successive of e-commerce and eB2Cmodel are highly relies on the broadband internet. At of latest, 10Mbps of broadband internet service is available. The comprehensive IT infrastructure also has encouraged MNC to setup their regional operation in Singapore. The successful of the financial and IT services business are highly rely on the state of the art IT infrastructure. Legal: Singapore is a republic with a parliamentary system of Government based on the Westminster Model. The roots of Singapore’s legal system can be traced back to the English legal system and it has evolved over the years. Our sources of law are derived from our Constitution, legislation, subsidiary legislation (e.g. Rules and Regulations etc.) and judge-made law. The Constitution is the supreme law of the land and lays down the basic framework for the three organs of state, namely, the Executive, the Legislature and the Judiciary. The Executive includes the Elected President, the Cabinet and the Attorney-General. The President is elected by the people and is empowered to veto government budgets and appointments to public office. The Cabinet comprises the Prime Minister and Ministers appointed from among the Members of Parliament and is responsible for the general direction and control of the Government and is accountable
  11. 11. to Parliament. The Attorney-General is the principal legal advisor to the government and has the power and discretion to prosecute offenders. The Legislature comprises the President and Parliament and is the legislative authority responsible for enacting legislation. Parliament is made up of elected, non-constituency and nominated Members of Parliament. The President’s assent is required for all bills passed by Parliament and he may in his discretion withhold assent to certain bills. The Judiciary consists of the Supreme Court and the Subordinate Courts and the head of the Judiciary is the Chief Justice. Judicial power in Singapore is vested in the Supreme Court and in such subordinate courts as may be provided for by any written law for the time being in force. Environment: Ministry of Environment and Water Resources (MEWR) is the main department which provides Singaporeans a quality living environment. It is successful in achieving a clean and green environment and a system in place to maintain and safeguard it, and now the ultimate goal is long-term environmental sustainability. Together with its two statutory boards, the National Environment Agency (NEA) and PUB, the national water agency, MEWR continues to manage Singapore's limited resources and address Singapore's environmental sustainability challenges through innovation, vibrant partnerships and co-operation across the 3P sectors - private, public and people. SWOT ANALYSIS OF SINGAPORE STRENGTH In Singapore, Manufacturing, Services and tourism industry plays a vital role in the rise of GDP of the country i.e.14.2%. a) Manufacturing Industry Manufacturing consisted of 26% of GDP. The manufacturing industry is diversified in electronic, aerospace, biomedical, petrochemical industries. Singapore has the open minded business environment; the economy is corruption free, transparent in its rules and regulations. In Singapore, business freedom is high- it takes 3-4 days to start a business whereas it would take 30 days to start business in other countries. b) Servicing Industry It deals in banking and finance industry and tourism industry. In banking and finance industry, Singapore’s banking system is considered to be among the strongest in the world. It’scentre is diverse and includes services such as banking, Asian dollar market, foreign exchange market, bond market, equity/derivatives market, asset management and insurance. Tourism Industry
  12. 12. Singapore attracts 11,638,663 tourists in 2010 over twice Singapore’s total population. English is the dominant of its four official languages, which males easier for the tourists to understand. The tourism industry has been increasing since 1965. Tourist attractions of Singapore include shopping, Island resorts, nature sight, dining and night life. Weakness Human Resource is one of the biggest weaknesses of this country. The population of Singapore is approximately 4.99 million, of whom 3.73 million were Singapore citizens. Its second weakness is its land area which is 794km. It makes it unable to the potential investors to invest in the country. Third weakness is the lack of physical resources thus it rely on extended concept of entrepot trade, by purchasing raw goods and refining them for re-export, as in the water fabrication and oil refining. Opportunities Petroleum and petrol chemicals are one opportunity Singapore have. Singapore has the third largest oil refinery in the world. Singapore is engaged in exploration, production, refining and distribution. Singapore is a net explorer of oil exorting1.374 million barrels of oil/day and importing 1.195 million barrel/day. Russia is introducing a new brand of crude oil for Asia. Through this Singapore can be very profitable as it can secure transportation and shipping contracts due to its location. Citizenship As in Singapore the population is not very vast, so providing citizenship to the outsiders is one opportunity for the country. The advantages of being citizen of the nation include travel freedom, Education, health, housing etc. To become a citizen of Singapore one has to become a permanent resident of the country for 2 years before applying Singapore citizenship under economic scheme; if you are married should apply after two years for the date of application. Citizenship applications take six months for processing. Threat a) Global Slowdown The countries exports are worse hit during recession in the US. As most of their exports and imports business deals with the US port. b) Rising Sea Level As the Island is surrounded by water, due to global warming rise in sea water can bring havoc ranging from coastal flooding and storm damage, eroding shorelines, flooding of coastal wetlands, resources will be affected, wildlife habitat will also be at risk. `
  13. 13. Conclusion From this we conclude that the policies adopted by Singapore govt benefited a lot. Due to govt interference & policies they achieved AAA rating from various agencies. We had also done pest analysis. In political, Singapore govt. mission to promote economic growth and create jobs, so as to achieve higher standards of living for all. To achieve this mission they made several categories like developing industries, expanding trade, FDI. In 2010 Singapore was fastest growing economy in the world, with GDP 14.47%. Due to this type of govt policies only 2.2% of unemployment is there, which is very low. In economy, the Singapore government has invested heavily in diversifying the economy. This has led to growth in the tourism industry, the pharmaceutical industry with a particular focus on biotechnology, financial services, business consultation services, education, multimedia, retail and leisure, and the medical technology industry. Not only that, there fiscal & monetary policy worked a lot. Their mission is to promote the overseas growth of Singapore-based enterprises and international trade. In social, English is the primary language used in Singapore’s education systems. Good command of English has given Singapore an edge advantage for attracting foreign investment and international trade. Technology, Singapore is relying on a mixture of public subsidies and private-sector participation and separating three main functions: the building of the infrastructure, the operation of the network and the provision of retail services. This pest analysis shows how govt policies worked in the development of Singapore & help in creating jobs. We also have done SWOT analysis. On the basis of which we came to know about the strengths & weaknesses. Like in strength, In Singapore, Manufacturing, Services and tourism industry plays a vital role in the rise of GDP of the country i.e.14.2%. With the help of SWOT analysis, we came to know about the banking sector of Singapore which is said to be strongest in the world. . Itscenter is diverse and includes services such as banking, Asian dollar market, foreign exchange market, bond market. Its tourism industry has been rising due to its English speaking population &govt policies. Singapore attracts 11,638,663 tourists in 2010 over twice Singapore’s total population. Tourist attraction of Singapore includes shopping, Island resorts, nature sight, dining and night life. But it also has weaknesses i.e. Human Resource is one of the biggest weakness of this country. The population of Singapore is approximately 4.99 million, of whom 3.73 million were Singapore citizens. Its second weakness is its land area which is 794km. It enables potential investors to invest in the country. Together with its common tertiary education and the hardworking and discipline of its citizen, the success of domestic business will ensure its competitiveness in the international era.
  14. 14. References: