Unit 10 Singapore's Economic Problems in 1960s and 1970s


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Unit 10 Singapore's Economic Problems in 1960s and 1970s

  1. 1. Unit 10 How did Singapore tackle Challenges in its Early Years of Independence?
  2. 2. Problems faced by Singapore <ul><li>People of different races and religions living together. </li></ul><ul><ul><li>PAP sought to develop a national identity </li></ul></ul><ul><ul><li>People were encouraged to work towards the good of the nation and work to protect and defend their achievements. </li></ul></ul><ul><ul><li>Government work to build a stable economy, provide housing and education to the people. </li></ul></ul>
  3. 3. Economic Problems <ul><li>Singapore has no natural resources like tin, rubber or oil. </li></ul><ul><li>It depended on entrepot trade for the last century. </li></ul><ul><li>By 1960s, more ports near Singapore were developed and we faced stiff competition from them. </li></ul><ul><li>They traded directly with other countries instead of sending their goods to Singapore for re-export. </li></ul><ul><li>Population had been growing and jobs had to be created for the people. </li></ul><ul><li>British forces were leaving Singapore. The people who had been working in the British bases lost their jobs. </li></ul>
  4. 4. Steps taken to solve economic problems <ul><li>Consulted Dr. Albert Winsemius, a Dutch economist. </li></ul><ul><ul><li>He recommended Singapore concentrate on manufacturing of low-value products like clothes, textiles and toys. </li></ul></ul><ul><li>New factories were set up in Jurong, Redhill and Tanglin. </li></ul><ul><ul><li>Factories were equipped with ready supply of electricity and water. </li></ul></ul>
  5. 5. <ul><li>Economic Development Board (EDB) was set up in Aug 1961. </li></ul><ul><ul><li>To encourage American, Japanese and European companies to set up factories in Singapore. </li></ul></ul><ul><ul><li>Had branches in America, Japan and Europe to provide information and assist international companies to set up factories in Singapore. </li></ul></ul><ul><ul><li>Foreign companies were given tax holidays – did not have to pay taxes for a few years while they continued operations in Singapore. </li></ul></ul>
  6. 6. Other roles of EDB <ul><li>Helped small industries expand. </li></ul><ul><li>Provided loans to new industries. </li></ul><ul><li>Conducted studies on new types of industries to be set up. </li></ul><ul><li>To develop and manage industrial estates. (Role was handed over to Jurong Town Corporation in 1968). </li></ul>
  7. 7. Support for industries <ul><li>Government continued to expand the international airport at Paya Lebar in the 1960s so that it could handle more cargo and bigger aircrafts. </li></ul><ul><li>Port of Singapore Authority was set up in 1964 to supervise, manage and develop port operations. </li></ul><ul><li>Late 1960s, a container port was built to deal with container ships arriving from other countries. </li></ul>
  8. 8. Building the infrastructure <ul><li>Public Utilities Board (PUB) Established to co-ordinate the supply of water, electricity and gas to the people in residential and industrial areas in Singapore. </li></ul><ul><li>Telecommunications were improved so people in Singapore could reach out to people overseas. This enabled business contacts overseas to be established. </li></ul><ul><li>Banking facilities of 35 major banks were improved. Money were lent to businesses to start new factories. </li></ul>
  9. 9. Communication betw workers and employers <ul><li>Industrial Relations Ordinance 1960 </li></ul><ul><li>Arbitration Courts to settle disagreements. </li></ul><ul><li>New labour laws were introduced to ensure fair treatment of workers. </li></ul><ul><li>National Trade Union Congress (NTUC) formed. </li></ul><ul><li>Government helped to set up market for sale of goods produced in Spore. </li></ul>
  10. 10. Competition. What should we do? <ul><li>1970s our competitors for low-value products were HK, Taiwan & S Korea. We switched to producing high-value products like </li></ul><ul><ul><li>electronics industries that produced TV, calculators, medical instruments and computer parts. </li></ul></ul><ul><ul><li>aircraft industry that produced aircraft parts and components. </li></ul></ul><ul><ul><li>oil rig industries that built oil rigs. </li></ul></ul><ul><li>Workers needed very specialised skills to produce these high-value products. Companies with technical know-how were encouraged to provide training to the workers. They were given tax holidays and other financial incentives in return. </li></ul>
  11. 11. Education <ul><li>New schools and vocational institutes were set up to provide education and technical training. </li></ul><ul><li>Training institutes were jointly set up by the government and international companies. For example, the French-Singapore Institute and German-Singapore Institute. </li></ul><ul><li>The Polytechnics, National University of Singapore and Nanyang Technological University were expanded to provide training for technicians and engineers. </li></ul>
  12. 12. Jurong Industrial Estate (JIE) <ul><li>July 1960 Minister of Finance, Goh Keng Swee introduced an idea of developing Jurong as an industrial estate. </li></ul><ul><ul><li>Located away from any built-up area and close to Malaysia, our hinterland. </li></ul></ul><ul><ul><li>Deep water that is suitable for building a harbour. </li></ul></ul><ul><ul><li>Was an area of jungles, swamp and old rubber estates as well as a small fishing village. </li></ul></ul><ul><ul><li>Communication lines were laid. </li></ul></ul><ul><ul><li>Roads, railway tracks and a network of telephone lines, a power station and a reservoir were constructed. </li></ul></ul>
  13. 13. JIE - Continuation <ul><li>Jurong had own port with wharves and modern facilities so that ships from overseas could bring in raw materials and manufactured goods could be exported. </li></ul><ul><li>1963 The National Iron and Steel Mills was the first factory to be set up in Jurong. Soon more factories followed. </li></ul><ul><li>1967 1 st phase of development was completed. </li></ul><ul><li>1968 there were 300 factories and 21,000 workers in Jurong. Factories in Jurong produced clothes, textiles, toys, woods products and beverages. </li></ul>
  14. 14. JIE – Continuation II <ul><li>Jurong grew fast in the first 2 decades. </li></ul><ul><li>It became one of the largest industrial estates in Asia. </li></ul><ul><li>End 1970 Jurong had 1400 factories, providing jobs for 112 000 workers. </li></ul><ul><li>By 1968 JIE and other industrial estates came under newly formed Jurong Town Corporation(JTC). </li></ul><ul><li>JTC developed Kallang basin, Sims Avenue and Redhill which are near residential areas. </li></ul>
  15. 15. External Developments and effects on Singapore <ul><li>1960s world trade was flourishing and most international companies were willing to invest in Singapore. Our economy grew. </li></ul><ul><li>1970s rise of oil prices affected world economy. This resulted in world-wide recession. Singapore was able to pull through because of the hard work of the people and it had a strong economic foundation. </li></ul>
  16. 16. Reasons for Our Success in building a Strong Economy <ul><li>Geographical position </li></ul><ul><ul><li>Located at the meeting points of the east and the west. </li></ul></ul><ul><li>Contribution of leaders in Singapore </li></ul><ul><ul><li>Leaders were far sighted and made careful decisions. </li></ul></ul><ul><li>Contribution of older generation in Singapore </li></ul><ul><ul><li>Hardworking, disciplined and willing to work together. </li></ul></ul>