Newsweek: Singapore's Rich-Poor Divide
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Singapore Swing
The island's economy is booming. So why are so many citizens worse off than they were 10 years ago?
By Sonia Kolesnikov-Jessop
Newsweek International
Jan. 29, 2007 issue - Tiny Singapore, with its population of 4.3 million, is often lauded for the way it has embraced globalization to maximum advantage. In the last decade, the city-state has opened its doors wide to foreign investment and talent, slashed corporate taxes, offered incentives to nurture strategic industries (such as biotech, pharmaceuticals and financial services) and cut free-trade deals with a host of other countries. The payoff has seemed clear: over the past three years, Singapore's economy has averaged 7.6 percent growth—a staggering pace for an industrialized state—and created new jobs at a rate any European government would envy.
There's only one problem: average citizens have yet to reap the benefits. New statistics reveal that middle-class households have tasted none of Singapore's spectacular growth, and that the island's poorest 30 percent are worse off than they were five years ago. "Although we have seen very strong growth, we're experiencing this new phenomenon of median real-wage stagnation and low-income decline," says Yeoh Lam Keong, vice president of the Economic Society of Singapore.
This predicament is hardly unique. Wages and salaries are stagnating across the industrial world. What's surprising is that even a country famous for its smart and transparent leadership has been unable to prevent the gains of globalization from flowing mostly to rich individuals and multinational corporations. In its bid to adapt Singapore's economy to international competition, the government has tried hard to reduce business costs. This has meant slashing labor prices, which has helped push wages down. According to official figures, over the past five years Singapore's wealthiest 10 percent have seen their income rise by 2.3 percent annually (and that doesn't include nonwage earnings such as capital gains or dividends). At the same time, the poorest 10 percent have suffered a staggering 4.3 percent drop in their salaries each year. The government has also allowed employers to cut their contributions to Singapore's Central Provident Fund, which pays for pensions, public housing, medical expenses and education.
Together, these factors have led to lower-than-expected private consumption, which has risen by just 3 percent in the past two years. "Private consumer spending has been the weak link in this current expansion," says Chua Hak Bin, an economist at Citigroup Global Markets in Singapore. This has, in turn, stung Singapore's large retail sector. "It is evident that [they] are not the big winners from high growth," says Manu Bhaskaran, a director of the U.S.-based Centennial Group.
http://www.msnbc.msn.com/id/16725528/site/newsweek/ -
How come when we, citizens voice out our concern... international media also joined in... our government is not doing anything?
MM Lee also said... the gov must do things even though the citizens may not like it.
"Popular government does not mean you have to be popular when you govern. All it means is at the end of your term, you've done all the unpopular things that were necessary to get you where you have to go and you get there. You're successful and everybody's better off. That's how we govern,"
I think by everybody's, he meant... his PAP ministers...
i will be an adult soon in sg.. later i must suffer... this is not fair..
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And exactly how does RAISING consumption taxes (aka GST) help to solve this issue?Originally posted by Lowclassman:"Private consumer spending has been the weak link in this current expansion," says Chua Hak Bin, an economist at Citigroup Global Markets in Singapore.
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Great, this is going to be the next international magazine to get sued and subscribers banned from subscribing anymore.
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Interesting article.Originally posted by Lowclassman:Singapore Swing
The island's economy is booming. So why are so many citizens worse off than they were 10 years ago?
By Sonia Kolesnikov-Jessop
Newsweek International
Jan. 29, 2007 issue - Tiny Singapore, with its population of 4.3 million, is often lauded for the way it has embraced globalization to maximum advantage. In the last decade, the city-state has opened its doors wide to foreign investment and talent, slashed corporate taxes, offered incentives to nurture strategic industries (such as biotech, pharmaceuticals and financial services) and cut free-trade deals with a host of other countries. The payoff has seemed clear: over the past three years, Singapore's economy has averaged 7.6 percent growth—a staggering pace for an industrialized state—and created new jobs at a rate any European government would envy.
There's only one problem: average citizens have yet to reap the benefits. New statistics reveal that middle-class households have tasted none of Singapore's spectacular growth, and that the island's poorest 30 percent are worse off than they were five years ago. "Although we have seen very strong growth, we're experiencing this new phenomenon of median real-wage stagnation and low-income decline," says Yeoh Lam Keong, vice president of the Economic Society of Singapore.
This predicament is hardly unique. Wages and salaries are stagnating across the industrial world. What's surprising is that even a country famous for its smart and transparent leadership has been unable to prevent the gains of globalization from flowing mostly to rich individuals and multinational corporations. In its bid to adapt Singapore's economy to international competition, the government has tried hard to reduce business costs. This has meant slashing labor prices, which has helped push wages down. According to official figures, over the past five years Singapore's wealthiest 10 percent have seen their income rise by 2.3 percent annually (and that doesn't include nonwage earnings such as capital gains or dividends). At the same time, the poorest 10 percent have suffered a staggering 4.3 percent drop in their salaries each year. The government has also allowed employers to cut their contributions to Singapore's Central Provident Fund, which pays for pensions, public housing, medical expenses and education.
Together, these factors have led to lower-than-expected private consumption, which has risen by just 3 percent in the past two years. "Private consumer spending has been the weak link in this current expansion," says Chua Hak Bin, an economist at Citigroup Global Markets in Singapore. This has, in turn, stung Singapore's large retail sector. "It is evident that [they] are not the big winners from high growth," says Manu Bhaskaran, a director of the U.S.-based Centennial Group.
http://www.msnbc.msn.com/id/16725528/site/newsweek/
Let me focus your attention to this statement:
"What's surprising is that even a country famous for its smart and transparent leadership has been unable to prevent the gains of globalization from flowing mostly to rich individuals and multinational corporations."
What is so surprising about this? I find it surprising that the author finds it surprising!
There are two implications.
1. The international community expects a smart and transparent leadership to necessarily produce even benefits for all classes of society.
2. The international community entertains the possibility that some hypothetical country can turn the "gains" of globalization into net benefit for the poorer classes of society.
These expectations are rooted in fantasy. -
That was the way they designed and abused the 'flexi wages' system by enriching the management teams of the SMEs who emulated the ministers' pay packet and cut back all pay increases for the middle and lower income groups, bringing in more cheaper 'foreign talents' in the name of globlisation. Listed companies and GLCs are earning more as a result and all credits go to them at the expense of the vast work force.........
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Hanor.. it affects lower income more.Originally posted by fudgester:And exactly how does RAISING consumption taxes (aka GST) help to solve this issue? -
I would like to point out to you that copies of teh Far Eastern Economic review is still available for loan in my polytechnic library.Originally posted by ditzy:Great, this is going to be the next international magazine to get sued and subscribers banned from subscribing anymore. 
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Go ahead and ban the publisher...
Ban every damn publisher in fact. And shut the door to the world.
This way, NO ONE can criticise our almighty government.
Regress top the like of old China would be better for them... -
Bottom line is no matter how much is written about the social & income divide here, how much can be done??? The men in white will always provide alternative statistics to prove you wrong......so why even bother, we have to either work harder or smarter to have a better life.....
One option like what many of us, including me have done, is MIGRATE....get the best of both worlds...... -
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New statistics reveal that middle-class households have tasted none of Singapore's spectacular growth,[/quote]
hmm. then who's hogging all the growth? -
or rather...no one IN singapore will know how pple outside are driticizing the government??Originally posted by ShutterBug:Go ahead and ban the publisher...
Ban every damn publisher in fact. And shut the door to the world.
This way, NO ONE can criticise our almighty government.
Regress top the like of old China would be better for them...
like north korea??? -
Hmmm, better to be in some other country no as well off as Sillypore but enjoy other intangible and tangible benefits like wide open spaces.
Things seem too good to be true here whenever you hear about being No.1 in this and that and growth s spectacular.....makes you wonder huh....is this for real when its too good to be true, so white, so staid, so sanitized....
I'd rather be someowhere else where there is some danger and some problems.....heightens your senses and makes you more sharp and work harder....
I say migrate to save your sanity -
Are you a loser or a quitter?Originally posted by Coquitlam:Hmmm, better to be in some other country no as well off as Sillypore but enjoy other intangible and tangible benefits like wide open spaces.
Things seem too good to be true here whenever you hear about being No.1 in this and that and growth s spectacular.....makes you wonder huh....is this for real when its too good to be true, so white, so staid, so sanitized....
I'd rather be someowhere else where there is some danger and some problems.....heightens your senses and makes you more sharp and work harder....
I say migrate to save your sanity -
He's smart.Originally posted by shade343:Are you a loser or a quitter? 
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Yes, he is a QUITTER!Originally posted by shade343:Are you a loser or a quitter?
And I'm a QUITTER too...
WE QUIT being fools to the gov here! -
lan lan have to accept whatever the gov gives us..
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I don't think coquitlam is a quitter.
He is a foreign talent overseas . He followed the govt policies of going out of his comfort zone overseas and learnt greatly from the FT policy of Singapore.
Just like me -
Migrate lar if u dun like sg, there is another alternative, vote for other parties lar...singaporean no balls to do that. PAP dun haf...sg die...that's what all singaporeans think
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Want to reap real rewards....migrate and you will see real rewards.....
We can never see real rewards...sure there will be profits...but its all locked up somewhere and better yet, they will used to cover losses once Shincorp gets forcibly taken back...value will drop and there will be losses...hurray -
thats why they need to raise 2% GST more to help the lower income who will be affected by the increase in the 2% GST...Originally posted by Gackt247:Hanor.. it affects lower income more.
duh...
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even the guy dat ask this quitter question have a quitter daughter
http://www.yeocheowtong.com -
how come never come out to sue those alligation?Originally posted by menoob:even the guy dat ask this quitter question have a quitter daughter
http://www.yeocheowtong.com