A

Country Paper
Presented to the Faculty of
Accountancy Program
Father Saturnino Urios University
San Francisco Street Corner, J.C. Aquino Avenue
Butuan City, Caraga, Philippines

In Fulfillment of the Requirements for the Subject

Economic Development

Submitted by:

Aninon, Chelsea Mhel

Atillo, Faith
Balagon, Marnelle
Batonghinog, Allona G.
Blancia, James Hubert
Caralde, Kieth Joshua
Dagondon, Bebs Alex Maureen
Gabor, Ylyn

Submitted to:
Joel Argawanon

DECEMBER 2022
 CHAPTER 1

POVERTY, INEQUALITY, AND DEVELOPMENT

This chapter represents data regarding the poverty and inequality index of the

country, Singapore. The data gathered tend to help in indicating the situation of the

country and this chapter provides information subject to Singapore’s state of poverty,

and inequality and to the policies implemented to overcome the said issues.

POVERTY AND GROWTH

Singapore’s economy is largely services-based, and the majority of its residents are

employed in this sector. The last decade has seen relatively consistent economic

growth, contributing to a robust job market and high labor force employment rates.

In 2020, the labor force employment rate of those aged 15 years and above in

Singapore was 64.5 percent. Singapore has enjoyed a relatively stable employment

rate. In the face of a rapidly aging population, however, it faces higher demand for labor

in the workforce.

Figure 1.1

Singapore Human Development Index

 Source: Human Development Report, 2020 Statistical Update

Qatar’s poverty headcount ratio of $5.50 a day is the percentage of the population

living on less than $5.50 a day in 2020 according to macrotrends.com and about 6.3%

of the population is living in extreme poverty according to the Singapore government.

Despite Singapore being one of the countries having the largest income gap in the

world. Wealth is lopsidedly spread among well-off outsiders while local Singaporeans

live in destitution and usually have lower-paying employment. The poverty in Singapore

is represented by the 5% unemployment rate among Singaporean youth under 30. Due

to the lack of minimum wage legislation in the country, many students and young people

are unable to obtain jobs with acceptable pay.

 To measure the degree of poverty found in Singapore, we will use the Human

Development Index to indicate the measurement of a country’s overall achievement in

its social and economic dimensions based on the wealth of the people, their level of

educational attainment, and their standard of living. 0.8-1.0 is very high, 0.7-0.79 is

high, 0.55-0.69 is medium, and 0.35-0.54 is low. This relates to poverty in the context of

the state of people living in Singapore if it is high or low using HDI. As from Figure 1

above, Singapore’s HDI is increasing throughout the 15 years, from 0.88 in 2006 it

became 0.94 in 2020. So this means that Singapore’s HDI is very high, thus poverty in

Singapore is low and people live on $5.50 a day. You can also notice that Singapore’s

HDI is consistently 0.88 percent so Singapore’s HDI through the years are all very high

and continuously increasing. This enables Singapore to be ranked 11th in the Human

Development Index among other countries. The human development journey has

bypassed specific groups and they face systemic barriers to overcoming deprivations. It

is essential to know who, where, and how of these deprivations and groups. While

mapping deprivations is important, human development for all necessitates rethinking

key analytical concerns and assessment stances in the field.

Sources:

https://countryeconomy.com/hdi/singapore

https://www.macrotrends.net/countries/SGP/singapore/poverty-rate'>Singapore Poverty
Rate -2022</a>. www.macrotrends.net. Retrieved 2022-11-27.

https://opendataforafrica.org/atlas/Singapore/Human-development-index

Singapore - Human Development Index - HDI 2019 | countryeconomy.com

INEQUALITY AND GROWTH

Figure 1.2

Singapore Income Inequality

Source: https://wid.world/country/singapore/

For all regions, income inequality is measured using the distribution of pre-tax national

income among adults (equal-split series). Pre-tax national income is the sum of all

pre-tax personal income flows accruing to the owners of the production factors, labor,

and capital, before taking into account the operation of the tax/transfer system, but after

taking into account the operation of the pension, unemployment insurance and other

social insurance systems.

 The data shows the percentage of the distribution of wealth in Singapore in which it

differentiates the pre-national income on 10% and 1% share. Now this distribution of

wealth also represents the degree of inequality in Singapore since the percentage of

people who belong to the 10% are rich and half of the world's net wealth belongs to the

top 1%.

As observed in Figure 1.2, Singapore’s movement on the national income is slowly

decreasing every year. In 2008 the national income was on an upward slope and in

2020 is on a downward slope. This indicates that income inequality is also decreasing

Singapore’s pre-tax national income on 10% share exceeds 43% to 32.9% in 2020.

Abram Lim stated in his report that there are 16.2% of the adult resident population, or

792,000 people, have a net worth of less than $13,500. This only measures the income

inequality but there is still another inequality to be pointed out, that is in Singapore,

those rich are getting richer, and those in the middle class remain stagnant. This means

that their income is far different since the rich are getting richer or they have more

privilege than the middle class. This also contributes to Singapore’s Gini index in 2008,

which is 46.7, relatively equal. Singapore's income per person is one of the world's

highest. Singapore currently ranks the 26th most income disparate. This makes them

the 2nd most income-unequal country in Asia. But income is unequally distributed: the

richest Singaporean receive over 17 times as much as the poorest.

Sources:

http://www.salaryexplorer.com/salary-survey.php?loc=196&loctype=1

https://en.wikipedia.org/wiki/Distribution_of_wealth

https://smartwealth.sg/income-inequality-singapore/
ECONOMIC CHARACTERISTICS OF HIGH-POVERTY GROUPS

RURAL POVERTY

The estimated percentage amount of the rural population in Singapore was 0.000 as

of 2020. As the graph below shows, over the past 60 years, this indicator reached a

maximum value of 0.000 in 2020 and a minimum value of 0.000 in 1960. Singapore is

an urban type of country that’s why there is 0 amount of a Rural Population.

Figure 1.3

Rural Population in Singapore

Source: https://www.macrotrends.net/countries/SGP/singapore/rural-population

WOMEN AND POVERTY

Singapore's society expects women to become creative and prolific corporate workers

who are also expected to play the role of traditional women in the household,
particularly as a wife and a mother. Singaporean women are confronted by the "conflict

between work and family" resulting from their becoming members of the working

population.

In five decades, the country has made huge strides towards gender equality, becoming

the top Asian country for gender equality: According to the United Nations Human

Development Report 2014, Singapore ranks 13th out of 155 countries on the gender

inequality index. With among the lowest rates of maternal mortality in the world.

Singapore is also considered to be the best place in Asia to be a mother. In Singapore,

0.1% of women aged 20–24 years old were married or in a union before age 18. The

adolescent birth rate is 2.1 per 1,000 women aged 15–19 as of 2019, down from 2.5 per

1,000 in 2018. The women in Singapore were able to get social protection, poverty, and

freedom from violence, stigma, and stereotypes. 89.3% is the proportion of mothers with

newborns receiving maternity cash for benefit. The prevalence of severe food insecurity

in the adult population is 4.5%. The unemployment rate of women aged 15+ is 4.4%.

In 2018, 2.4% of women aged 15-49 years reported that they had been subject to

physical and/or sexual violence by a current or former intimate partner in the previous

12 months. In politics, the proportion of seats held by women in national parliaments is

29.5% and 36.4 % is the proportion of women in managerial positions in Singapore.

Singapore's female managers are still fewer in number despite their rising educational

level and attainments when compared to male managers.

. As of December 2020, only 36.9% of indicators needed to monitor the SDGs from a

gender perspective were available, with gaps in key areas, in particular: unpaid care
and domestic work, and key labor market indicators, such as the gender pay gap. In

addition, many areas – such as gender and poverty, physical and sexual harassment,

women’s access to assets (including land), and gender and the environment – lack

comparable methodologies for regular monitoring. That is why Singapore’s goals are to

achieve gender equality and to polish and implement laws for women’s rights. Closing

these gender data gaps is essential for achieving gender-related SDG commitments in

Singapore. To show, in fact, that a woman is every bit as capable and has potential as a

man in these areas. Thus, in the present year, women continue to contribute to

Singapore’s economy and growth.

Sources:

https://data.unwomen.org/country/singapore

https://www.connectedwomen.co/magazine/women-in-the-singapore-of-tomorrow-past-
achievements-future-aspirations/

https://en.wikipedia.org/wiki/Women_in_Singapore

ETHNIC MINORITIES AND INDIGENOUS POPULATIONS

Singapore is a sovereign island country and city-state in maritime Southeast Asia. The

country's territory is composed of one main island, 63 satellite islands and islets, and

one outlying islet; the combined area of these has increased by 25% since the country's

independence as a result of extensive land reclamation projects. It has the third highest

population density in the world. With a multicultural population and recognizing the need

to respect the cultural identities of the major ethnic groups within the nation, Singapore

has four official languages: English, Malay, Mandarin, and Tamil.

The Republic of Singapore

After being expelled from Malaysia, Singapore became independent as the Republic

of Singapore on 9 August 1965, with Lee Kuan Yew and Yusof bin Ishak as the first

prime minister and president respectively. In 1967, the country co-founded the

Association of Southeast Asian Nations (ASEAN). Race riots broke out once more in

1969. Lee Kuan Yew's emphasis on rapid economic growth, support for business

entrepreneurship, and limitations on internal democracy shaped Singapore's policies for

the next half-century. Economic growth continued throughout the 1980s, with the

unemployment rate falling to 3% and real GDP growth averaging at about 8% up until

1999. During the 1980s, Singapore began to shift towards high-tech industries, such as

the wafer fabrication sector, in order to remain competitive as neighboring countries

began manufacturing with cheaper labor.

Malay in the Republic of Singapore

The Malay made up 15% of Singapore's population and were, like the Chinese and the

Indians, descendants of immigrants. They or their ancestors came from peninsular

Malaya, Sumatra, Java, and the other islands of the Indonesian archipelago. Although

very much a part of Singapore's modernizing society, the Malays conspicuously

occupied the bottom rungs of that society; their position illustrated a correlation between

ethnicity and class that presented a major potential threat to social stability.

Some Malays say they are second-class citizens. Malays lag behind ethnic Chinese

and Indians in terms of income and higher education, while there are complaints that

Muslim men are excluded from sensitive military roles. With the lowest level of
educational attainment of any ethnic group, the Malays were concentrated at the low

end of the occupational hierarchy and had average earnings that were 70% of those of

the Chinese. Malays had a higher crime rate than other groups and in 1987 accounted

for 47% of the heroin addicts arrested. The 1980 census showed that 86 percent of the

Malay workforce was in the clerical, service, and production sectors; 45% of all

employed Malays worked on assembly lines, largely in foreign-owned electronics

factories. Only 8% of all professional and technical workers (including school teachers),

and 2% of all administrative and managerial personnel were Malays. Malays dropped

out of the competitive school system in large numbers, and those who continued past

primary school were concentrated in vocational education programs. In 1980 they made

up only 1.5% of all university graduates and 2.5% of students enrolled in higher

education.

After independence, the government regarded the Malay preponderance in the police

and armed forces as disproportionate and a potential threat to security and acted to

make the security forces more representative of the society as a whole, which meant in

practice replacing Malays with Chinese. The government's drive to break up ethnic

enclaves and resettle kampong dwellers in Housing and Development Board apartment

complexes had a great effect on the Malays. Evidence of the convergence of Malay

patterns of living with those of the rest of the population was provided by population

statistics, which showed the Malay birth and death rates, originally quite high, to be

declining. In the 1940s, Malay women had married early, had many children, and were

divorced and remarried with great frequency. By the 1980s, Malays were marrying later,

bearing fewer children (2.05 per woman from mid-1986 to mid- 1987), and divorcing
less frequently. By the 1980s, a large proportion of Malay women were working outside

the home, which was a major social change. Many young women in their late teens and

early to mid-twenties were employed in factories operated by multinational corporations.

Even Malay fishing communities on the offshore islands, which appeared to preserve

the traditional way of life, were in the 1980s losing population as young people moved to

Singapore Island, attracted by urban life and unskilled jobs that offered higher and more

reliable incomes than fishing.

Singapore was a small society open to influence from the West through the English

language and subject to the homogenizing effects of modernization and

industrialization, the persistence of ethnicity as a fundamental element of its social

structure was by no means assured. By the late 1980s, ethnic affiliations were in many

ways less significant than they had been in 1970 or 1940, and the lives of members of

distinct ethnic groups had more and more common elements. In Singapore, as

elsewhere, the forces of standardized education, impartial application of laws and

regulations, common subordination to the impersonal discipline of the factory and the

office, common pursuit of leisure activities, and exposure to international mass media

resulted in many shared attitudes among ethnic groups. Singapore's main ethnic

communities have generally co-existed peacefully since independence in 1965, with the

Government placing a high priority on promoting racial harmony.

Sources:

Library of Congress

https://factsanddetails.com/southeast-asia/Singapore/sub5_7b/entry-3733.html

https://en.wikipedia.org/wiki/Singapore#Republic_of_Singapore
POLICIES IMPLEMENTED

Ethnic Integration Policy

The Ethnic Integration Policy was implemented on 1 March 1989 to promote racial

integration and harmony in Housing and Development Board (HDB) estates. Then

Minister for National Development S. Dhanabalan first highlighted the emergence of

ethnic enclaves in HDB estates in his speech to community leaders at a New Year’s

gathering held at the People’s Association auditorium on 6 January 1989. To illustrate

his point, he drew on the examples of neighborhoods in Bedok and Tampines housing

estates where Malay households made up more than 30% of the estate population, and

Hougang where more than 90% of the households are Chinese. In a bid to address the

growing issue of communal clustering, Dhanabalan announced that the government

would adopt policies to maintain the ethnic balance as a means to foster social and

racial cohesion.

Dhanabalan officially introduced the Ethnic Integration Policy in parliament on 16

February 1989. To ensure a better racial mix in HDB estates, the government

established ethnic quotas for HDB neighborhoods and blocks. The permissible

proportion of flats in each neighborhood for Malays was 22 percent while the

permissible proportion of flats in each block was 25%. For Chinese, the permissible

proportions were 84% and 87% respectively, and for Indians and other minority groups,

the figures were reduced to 10 percent and 13% respectively. The new policy only

affected the sale of new and resale flats from 1 March 1989, and it was carried out on a
first-come-first-served basis. Owners were free to sell their flats to a buyer of any race

as long as the racial limits were maintained. Dhanabalan also assured parliament that

none of the existing HDB owners would be asked to move or to sell their existing flats

and that the constitution was not breached because no one was being discriminated

against. Based on the HDB’s analysis, 35 out of 125 neighborhoods across 25 HDB

new towns were affected by the policy changes in 1989.

Group Representation Constituencies

The Group Representation Constituency (GRC) scheme, though contentious when it

was mooted as a way to ensure minority representation in Parliament, has helped weed

out “divisive racial sentiments”, said the analysts. The GRC system was first pitched in

1982, as Mr. Lee sought to ensure minority representation in Parliament, concerned that

young voters were less aware of the importance of having multiracial Members of

Parliament (MPs). Six years later, the idea came to fruition, with political parties fielding

teams in a GRC being required to have at least one minority team member. The size

and racial composition of each GRC were defined by the President and can change for

each election. “It means that all the political parties cannot take an anti-multiracial

stance. You have to stand by these values as part of the political process,” said Dr.

Puthucheary.
 Some, such as the civil society group Mariah, however, have argued that the

requirement creates a barrier for smaller political parties that want to contest in elections

as they may be hard-pressed to field a quality team. The group also thinks that the

scheme “entrenches the expectation of ethnic voting”. As GRCs grew in size and

numbers, so has the number of minority MPs. There were 14 when GRCs first appeared

in the Republic’s electoral history in 1988. Today, the number has slightly more than

doubled to 30, including non-constituency and nominated MPs.

For Children and Youth Policies

A small island state with no natural resources, Singapore’s only resource is its people.

Singapore must develop its people to the fullest potential, and a crucial stage of

development is in a person’s childhood and adolescence. MSF believes in empowering

our children and youth and providing them with conducive environments to grow and

develop into good citizens and socially responsible adults.

➢ Family Guidance Order

➢ Obligations under the Hague Convention on the Civil Aspects of International

Child Abduction

➢ Obligations under the UN Convention on the Rights of the Child

➢ Optional Protocol on the Involvement of Children in Armed Conflict

➢ Protection under Children & Young Persons Act

➢ Working with Partners to Help Youths-At-Risk

➢ Rebuilding Children and Youth

➢ Integrated Service Providers (ISP) for MSF-funded Youth-At-Risk Programmes

Helping The Needy And Vulnerable

A caring society is a compassionate one that cares for the less fortunate. Every citizen

and his family should be assisted in their effort to attain the means and opportunities for

a decent and dignified living. Persons facing hardships are given help to tide them over

a difficult period as well as to regain their financial independence. This will enable them

to continue to contribute positively to the nation.

➢ Singapore Inter-Agency Taskforce on Trafficking in Persons

The Singapore Inter-Agency Taskforce on Trafficking in Persons, established in 2010,

aims to implement holistic, coordinated strategies to combat Trafficking in Persons more

effectively.

➢ Supporting Vulnerable Elderly

We are the lead agency providing social support for vulnerable seniors and are part of

the Ministerial Committee of Ageing (MCA).

➢ Welfare Homes

The Destitute and Shelter Support Branch (DSSB) is responsible for ten homes that are

gazetted as welfare homes under the Destitute Persons Act for the care, reception, and

rehabilitation of destitute persons.

➢ Protection for Vulnerable Adults

The Vulnerable Adults Act (VAA) safeguards Vulnerable Adults (VA) from abuse,

neglect, or self-neglect. The Act came into force on 19 December 2018.

 ➢ PEERS Network

The Partners Engaging and Empowering Rough Sleepers (PEERS) Network is a

collective partnership of community groups, social service agencies, and government

agencies, joining hands to engage and support rough sleepers and homeless

individuals.

International Conventions

MSF has acceded to the following international conventions.

➢ Singapore's Reports: The Convention on the Elimination of All Forms of

Discrimination Against Women (CEDAW)

The CEDAW is a United Nations human rights treaty for women and consists of a

preamble and 30 Articles defining what constitutes discrimination and how equality can

be achieved. Singapore acceded to the Convention on 5 October 1995.

➢ Singapore's Reports: The United Nations Convention on the Rights of the Child

(UNCRC)

The United Nations Convention on the Rights of the Child (UNCRC) is a treaty that

comprehensively provides for the rights of children. It sets out the standards on the

provisions of healthcare, education, and legal and social services for children.

Singapore acceded to the Convention on 5 October 1995.

➢ Hague Convention on the Civil Aspects of International Child Abduction

(HCCAICA)
 The Hague Convention of 25 October 1980 on the Civil Aspects of International Child

Abduction (HCCAICA) is a multilateral treaty that seeks to protect children from the

harmful effects of abduction and retention across international boundaries when the

child is taken away by a parent to another jurisdiction without the consent of the other

parent. Singapore acceded to the Convention on 28 December 2010.

➢ UN Convention on the Rights of Persons with Disabilities (UNCRPD)

The United Nations Convention on the Rights of Persons with Disabilities (UNCRPD)

is a comprehensive convention to promote, protect and ensure the full and equal

enjoyment of all human rights and fundamental freedoms by all persons with disabilities,

and to promote respect for their inherent dignity. Singapore acceded to the Convention

on 18 July 2013.

The Policy of Meritocracy

The state strongly upholds meritocracy. It only provides education and growth

opportunities to its deserving citizens so that they achieve greater goals for society (in

line with the Confucian principle). As a result, individual economic well-being is entirely

dependent upon an individual's capability and hard work with limited or no support from

the government. This meritocracy principle has affected the societal dynamics in two

ways:

a. Labor markets in Singapore separate skilled & well-paid from the unskilled & low-paid

by increasing sharpness.
b. Similar to the labor markets, Singapore’s schools demonstrate a strong bias toward

the cognitive elite. For marginal students, the choice of education is relatively limited.

For instance, students who are clearly university-bound, and could do well in a less

structured environment have the choice of IP. IP schools take in the top 6 percent of

each cohort. For the less academically able who cannot enter polytechnics or

universities based on state-wide examinations, the only alternative is to enter the

Institute of Technical Education (ITE) after their secondary education. As the job market

rewards strongly in favor of educational accomplishments, such vocational and

technical training is not held in high esteem in Singapore, unlike other countries like

South Korea. Technical institutes are viewed as ‘dumping grounds’ or ‘catch-nets’ for

those who failed to meet up with academic rigor. This favoring of the top 10% & limiting

options for the rest is resulting in ‘trained incapacity’ in Singapore‘s work, thereby

exacerbating the income divide.

Well-educated parents provide better opportunities, encouragement, exposure, and

developmental support to their children. As a result, children of these well-to-do

Singaporeans enter better schools, gain university education, benefit from IP-like study

options and hence continue to command high salaries; which vary strongly with

educational credentials. Thus, while the families of the cognitive elite enter an upward

spiral, the progress of the oppressed is limited at each step pushing them into a

downward spiral.
 The utilitarian ideal of meritocracy has not earned Singapore a reputation for

transparency and capability. So long as the economy was growing and there were jobs

for all there was less resistance to structural inequality in the education system. But in a

much more volatile economic environment, and indeed one that is said to value

innovation, creativity, and risk-taking, it can be argued that limiting options for large

numbers of school goers is subtly distorting the social fabric by creating two extremes

that may never meet until the government intervenes with some form of affirmative

action.

Policy towards Foreign Workers

Since the mid-1970s Singapore has become increasingly dependent on foreign labor

to fuel its high growth and competitive position. In later years, foreign workers were

welcomed with even greater gusto to address falling fertility rates as well as to steer

Singapore’s transition into a knowledge-based economy.

Foreign labor is allowed into the country under two schemes - employment passes for

professionals and managers, and work permits for semi-skilled and unskilled workers in

manufacturing, construction, and services. The managers and professional personnel in

MNCs based in Singapore come from developed countries like Japan, Western Europe,

and North America. They are paid expatriate salaries that reflect their remuneration in

their home countries. This has a spill-over effect of raising the remuneration packages

of local managers and professionals working in the MNCs and other business firms.
 At the lower end, the unskilled and semi-skilled foreign workers come from developing

or under-developed nations like India, Sri Lanka, Bangladesh, and the Philippines. They

are paid lower wages than their counterpart Singaporeans, although much higher than

the wage levels of their less developed home countries. Thus, the large pool of foreign

semi-skilled and unskilled workers has kept the salaries of this income segment low.

Changes in Taxation Policy

In concept, the individual tax system in Singapore is progressive such that low-income

households do not pay any tax and at the same time receive subsidized government

services, while the high earners pay progressively higher taxes. Thus, the disparity in

post-tax (or real income) is much lower. However, changes in the tax structure in the

past decade or so have reduced this equalizing effect of Singapore's taxes.

a. Singapore has never taxed capital gain. Even the estate duty has been

abolished in 2008 under the rationale of, firstly, encouraging thrift and secondly,

discouraging wealth transfer to other countries to avoid taxation. Thus, the rich

can now transfer most of their wealth to the next generation. This raises the

asset incomes of the richer class, thus causing a rub-off effect on income

inequality.

b. Although the personal income tax rates remain progressive, they have

declined over the past years to once again, encourage savings ethics. This

reduction in the personal tax base benefits the higher-income groups more than

the lower-income segment. This is further exemplified by the exemption of

interest income from income tax.

 c. In an effort to encourage business enterprises, including foreign enterprises,

the corporate income tax has been progressively reduced over the years, from

over 40% in the 1960s to 18% currently. To offset the reduced dependence of

government revenue on direct corporate and personal income taxes and to

broaden the revenue base, the government introduced the Goods and Services

Tax (GST) in April 1994 – a consumption tax on all goods and services other than

sale/ lease of property and financial services. With further reductions in corporate

and personal income tax, the government made up by progressively increasing

the GST.

Like any other direct consumption tax, GST is regressive in nature. It equally

affects all consumption baskets (rich and poor), thus undermining the equalizing

role of the taxation policy. Even the GST offset packages do little to ease the pain

of low/middle-income households. The cumulative effect of decreasing personal

and corporate taxes and increasing GST has led to a preponderance of income

inequality. This deep dive thus suggests that though the income divide was

definitely a spillover of Singapore’s high growth, its Educational, Fiscal, and

Manpower policies also share some blame for exacerbating the problem.

GENERAL CONCLUSION
 Despite the small size of Singapore, the way Singapore's economy works, it was able

to minimize and maintain the low number of poverty in Singapore and the government is

on its way to eradicate poverty in their country. Through implementing the policies

related to poverty they were able to effectively and efficiently help the Singaporeans to

get through the poverty. Although Singapore has a low number of people who

experience poverty there are still complaints about the unequal distribution of income.

Sources:

Chua, 2007 available in Asher and Nandy, 2008

Ethnic Integration Policy is implemented - Singapore History (nlb.gov.sg)

Language planning and policy in Singapore - Wikipedia

https://www.todayonline.com/singapore/policies-shaped-multiracial-nation

Policies | Ministry of Social and Family Development (msf.gov.sg)

 CHAPTER 2

POPULATION GROWTH AND ECONOMIC DEVELOPMENT

DEMOGRAPHIC TRANSITION

The Demographic Transition Model, which has five stages, keeps track of the number

of births and deaths in a county as well as how those events relate to other ongoing

social, economic, and political aspects. Future political and economic changes may be

influenced by our understanding of the overall contributions to demographic trends.

Singapore is a MEDC in Stage 5 of the DTM (Demographic Transition Model).

According to the DTM diagram on the page titled "Population Models," it has a falling

population. A few important demographic statistics for Singapore are listed in the table

below.

Table 2.1

Demographic Statistics for Singapore

1970 1980 1990 2000 2010 2013

Total Population 2,074.5 2,413.9 3,047.1 4,027.9 5,076.7 5,399.2

('000)
Life Expectancy 65.8 72.1 75.3 78 81.7 82.5
Infant Mortality Rate 20.5 8.0 6.6 2.5 2.0 2.0
(per 1,000 resident
live births)
Source: Department of Statistics Singapore, 2014. (*= when the second policy was put
in place)

Singapore reached its highest fertility rate of 6 in 1957. (children per woman).

Therefore, in order to ensure sustainable development, the government tried to control

population growth through the implementation of an anti-natalist policy. A strategy

known as anti-natalism is implemented when resources cannot keep up with the

population's rapid growth. In order to slow down population growth, the government

implemented a population policy in the 1960s.

Figure 2.1

Singapore Population 2022

 The total fertility rate of Singapore, which is 1.20 per woman, suggests that there

won't be much of a rise in the population overall. The government's efforts demonstrate

the necessity to raise the fertility ratio even if it now stands as one of the lowest in the

world. The government has in the past run extremely visible efforts to draw attention to

the drawbacks of an aging population. It has also been forced to change its immigration

laws in order to let in those who will fill the nation's labor need.The population is

expected to increase throughout time, however due to the Island's industrialisation, the

increase won't be enough to meet Singapore's labor needs. As a result, it's possible that

some of the population growth in the years to come will be ascribed to immigration to

the nation.

Population Rank

113

Growth Rate

0.58% (144th)

2022 World Percentage

0.07%

Density

8416.46/km² (3rd)

Land Area

710

The current population of Singapore is 5,993,134 based on projections of the latest

United Nations data. The UN estimates the July 1, 2022 population at 5,975,689.
Singapore Population Growth

Estimates from 2006 indicate that the net migration rate was 9.12 migrants per 1000

of the population. This was because the aging part of the population, although lower

than most other developed countries at 9.9%, created a need to increase the task force

in the country through means other than natural growth.

With the country’s different cultures bearing less than 1.7 as the fertility rate, the

change in the current population is significantly impacted by immigrants over time.

Since the early 2000s, the trend in population growth has been more a result of the

number of migrants entering the country than from natural population growth.

The annual growth rate in 2012 was 2.5% according to statistical figures released.

The Total Fertility Rate (TFR) has been 1.2 as of 2011 with 1.08 for Chinese, 1.64 for

Malay and 1.09 for Indians. The Malay fertility rate was 70% higher than that of the

Chinese and Indians. The country’s authorities have tried for years to boost the fertility

ratio to 2.1 births per woman.

By the end of June 2012, the population of Singapore stood at 5.31 million. The

record low was 1.65 million five decades ago, even though the fertility ratio then was

higher than it is now. Today, the population is estimated to be 5.5 million. Immigration

into the Island has played a critical role in realizing the current population figure. As the

government’s recent campaigns to increase the fertility ratio from 1.20 to 2.1 have been

futile, the government has been forced to amend its immigration policies to

accommodate the increasing labor demands caused by the Island’s industrialization.

Singapore Population Projections

The drastic changes in population are not expected to continue in the years to come.

Current projections believe that the rate of annual growth will peak in 2020 around

1.40%, before plummeting to a negative growth rate by 2050, which is largely due to the

upcoming legislature that will limit the number of migrants that can enter the country.

These predictions believe that the population of Singapore will be roughly 5,935,053 in

2020, 6,352,470 in 2030, 6,563,055 in 2040 and 6,574,759 by 2050.

AGE STRUCTURE AND DEPENDENCY BURDEN

The total age dependency ratio is the ratio of young + elderly dependents (who are

generally economically inactive, under 15 or over 64 years old), compared to the

number of people of working age (15-64-year-olds).A high dependency ratio means

those of working age, and the overall economy, face a greater burden in supporting the

dependent population.Singapore's age dependency ratio for the dependent population

was: 65.5% reported in 2019 (most recent observation). This is a high value against a

global average of 40.1%. A higher ratio indicates more financial stress on working

people and possible political instability. Singapore's data is highlighted in the table

below, use the filter and sort order options to allow easy comparison with other

countries. ( World Bank, Washington D.C).

Old-age dependency ratio Singapore 2012-2021

 In 2021, the old-age dependency ratio in Singapore was at 23.1 residents aged 65

years and older per hundred residents aged 15 to 64 years. In the last ten years, this

ratio has increased from 13.5 in 2012. Singapore is facing the challenge of an

increasingly aging population and a declining birth rate, leading to a possible

continuation of the trend of increasing old-age dependency ratio. (R. Hirschmann,2022)

POLICIES IMPLEMENTED

Government population Policies

Our population size is affected by many factors, including birth rates, life expectancy,

as well as global developments. The Government aims to achieve a careful balance

between these factors to ensure a sustainable Singapore with a cohesive society and

vibrant economy that improves Singaporeans’ lives.

The Government does not seek to achieve any particular population size. We monitor

our population trends closely, and regularly review our population policies along with

infrastructure and social development needs. An update on our population outlook was

provided in Parliament in March 2018. At that update, the Government said that given

recent trends, Singapore’s total population is likely to be significantly below 6.9 million

by 2030. This outlook remains valid today. (Gov.sg, March 2020)

 CHAPTER 3

URBANIZATION AND RURAL -URBAN MIGRATION DEVELOPMENT

This chapter shows data about the relationship of Urbanization and Economic Growth,
Urban versus Rural population, Informal Urban Labor Force, Urban Unemployment and
the Policies Implemented over the past 10 years that affect the development of
urbanization in Qatar.

URBANIZATION AND ECONOMIC GROWTH

Singapore was one of Asia's most economically advanced cities in the 1940s, 1950s,

and 1960s despite being less urbanized than it is today (Huff, 1995). The urban area

was home to about 70% of the population in 1951 (Fraser, 1952), most of whom resided

in or nearby terraced shophouses, government-built public housing apartments (Seng,

2009a; Teo and Savage, 1985), or unofficial "kampong" settlements made primarily of

corrugated tin and natural materials (Teo and Savage, 1985). Many informal

communities were peri-urban in nature and established next to urban areas, with their

residents leading rather rural lifestyles (Seng, 2009a; Teo and Savage, 1985; Xiong and

Brownlee, 2018).

URBAN VERSUS RURAL POPULATION

Singapore's population is entirely urban and expanding, with a fertility rate of 1.2

children and a life expectancy of 82.6 years, according to the International Labour

Organization's report, "Singapore: Employment and Environmental Sustainability."

Approximately 73% of people are of legal working age (15–64 years). Singapore has no

inhabitants who live in rural areas.

Figure 3.1: Demographics for Singapore

INFORMAL URBAN LABOR FORCE

Singapore is a highly formalized economy where the vast majority of workers are

afforded regulatory oversight and employment protection in its labor laws and

regulations.

Foreign Workers

Singapore has one of the most open economies in Asia in terms of trade, foreign direct

investment inflows and foreign labor inflows. By 2010, citizens formed only 63.6% of the

population and foreigners (not including permanent residents) form 34.7% of the labor

force. Singapore has 1,427,500 migrant workers, comprising 38 per cent of its labor

force (MOM 2019).

URBAN UNEMPLOYMENT

In Singapore's early years, overcoming the issue of high unemployment posed the

biggest difficulty. Even though Singapore's economy experienced tremendous growth in

the 1960s, it was still a long way from becoming prosperous. Around 10% of the

population was still unemployed, and economic difficulties were mostly brought on by

uncertainty regarding the British withdrawal from the island and the confrontational

posture of Indonesia. The report, which was submitted in 1961, predicted that a rapid

industrialisation program would eliminate unemployment by 1965. These

industrialization aspirations, however, would be derailed by Singapore's application to

join the Federation of Malaya (now known as Malaysia). Despite Singapore's continued

industrialization and economic growth throughout those years, investors were reluctant

to launch operations there due to the political unpredictability of the time from 1963 until.

POLICIES IMPLEMENTED

The Land Acquisition Act, 1966

The Land Acquisition Act of 1966 was a crucial step in Singapore’s housing policies

and economic development and has had major redistribution effects (Phang, 1996,

2015a).

THE HDB–CPF HOUSING FRAMEWORK

The HDB is the key pillar of Singapore’s housing system. The achievements of the

HDB, including its dominant role in Singapore’s housing sector, have been extensively

documented elsewhere (Yeh (1975), Wong and Yeh (1985) et,al.)

The Employment of Foreign Manpower Act (EFMA)

The act regulates and protects the well-being of foreign manpower and sets the

responsibilities of employers and intermediaries.

Singapore Green Plan

Singapore's first environmental blueprint. Its goal is to ensure that Singapore can

create an economic growth model that does not harm the environment. It was published

in 1992 by the then Ministry of the Environment (now known as the Ministry of the

Environment and Water Resources or MEWR). A second SGP, dubbed the Singapore

Green Plan 2012 (SGP 2012), was introduced in 2002.

GENERAL CONCLUSION

One of the most defining concerns of the twenty-first century is urbanization, which is

becoming more widely recognized. More than half of the world's population presently

lives in cities, with that number expected to climb to 75% by 2050 (UN DESA, 2015).

Currently, hundred percent of Singapore is urbanized and they have achieved these

through various efforts and policies.

Singapore during the 1960s was a period of uncertainty as it became independent.

The country was facing massive unemployment together with an increasing population.

The government implemented policies to strengthen their employment and living

conditions. Because of various efforts such as the HDB-CPF Housing Framework paved
the way for Singaporeans to afford their own houses. Industrialization played a major

role in strengthening its role as a trade port which resulted in creating jobs for its

increasing population. Thus, reducing their unemployment rate.

 CHAPTER 4

THE ENVIRONMENT AND DEVELOPMENT

The information in this chapter relates to Singapore's ecology and development. The

knowledge acquired tends to be helpful in determining the state of the nation, and this

chapter offers details about Singapore's growth and environmental conditions as well as

the policies put in place to address the aforementioned problems.

The Environment and Development in Singapore

Climate change is a global challenge that requires a global response.

As a small, low-lying city-state with one of the world’s most open economies,

Singapore is particularly vulnerable to the impact of climate change. We are committed

to a multilateral, rules-based solution to address this challenge, and actively support

and participate in international negotiations on this front.

Singapore ratified the United Nations Framework Convention on Climate Change

(UNFCCC) in 1997, acceded to the Kyoto Protocol in 2006, and also ratified the 21

amendments on the second commitment period (from 2012 to 2020) of the Kyoto

Protocol in 2014. At the 21st Conference of the Parties to the UNFCCC (COP-) in Paris

on 12 December 2015, countries adopted the Paris Agreement, a universal and legally

binding agreement for post-2020 climate action. Singapore ratified the Paris Agreement
on 21 September 2016 in New York, becoming one of the first few countries to do so,

alongside 30 other countries. The Paris Agreement entered into force on 4 November

2016, 30 days after it crossed the double threshold of 55 Parties ratifying and the total

emissions of ratifying Parties exceeding 55% of global greenhouse gas emissions.

Following three years of negotiations, Parties subsequently agreed to conclude the

Paris Agreement Work Programme (PAWP), stipulating the modalities, procedures and

guidelines for the implementation of the Paris Agreement, during COP-24 in Katowice,

Poland in December 2018. We look forward to concluding discussions on outstanding

elements of the PAWP at COP-26 in Glasgow, Scotland in 2021.

Although Singapore accounts for around 0.11 percent of global carbon emissions, we

have made significant efforts to reduce emissions domestically. About 95 percent of our

electricity is generated from natural gas – the cleanest fossil fuel – and we have

implemented policies to cap vehicle growth and manage vehicular emissions. Our small

size and high population density, however, limits our ability to draw on alternative

energy such as solar, wind, or nuclear. Nonetheless, we firmly believe that it is important

for all countries to contribute to global efforts to combat climate change, with each doing

its best based on principles of common but differentiated responsibilities, respective

capabilities and national circumstances.

Singapore also strongly believes in contributing to global efforts through providing

capacity-building to fellow developing countries to help them meet their climate pledges

and take effective action on climate change. Notably, we established a dedicated

Climate Action Package (CAP) under the Singapore Cooperation Programme in 2018 to

help develop capacity in developing countries in areas such as climate science, flood
management, and disaster risk reduction. Recently, we have undertaken a slew of

initiatives with fellow ASEAN Member States on capacity-building to effectively

implement the Paris Agreement. Our technical assistance programmes have been

undertaken bilaterally, with other countries, or in partnership with relevant international

organizations.

POLICIES IMPLEMENTED FOR THE ENVIRONMENT

SINGAPORE'S CLIMATE ACTION PLAN

Singapore launched our Climate Action Plan in July 2016 which details our strategies

to adapt to the impact of climate change, such as implementing coastal and

infrastructure protection measures. The Plan also explains our approach to reduce

carbon emissions up to 2030, which includes: (i) improving energy efficiency; (ii)

reducing carbon emissions from power generation; (iii) developing cutting-edge

low-carbon technologies; and (iv) responding through the collective action of

government agencies, individuals, businesses and the community. These steps have

been reflected in Singapore’s climate pledge (i.e., our Nationally Determined

Contribution or NDC) under the UNFCCC. In July 2015, we announced our target of

reducing emissions intensity by 36 percent from 2005 levels by 2030, and stabilizing

emissions with the aim of peaking around 2030.

Most recently, despite the difficult circumstances caused by the COVID-19 pandemic,

Singapore pressed ahead to submit our enhanced NDC and Long-Term Low Emissions
Development Strategy (LEDS) to the UNFCCC on 31 March 2020. The enhanced NDC

updates our 2015 pledge with an absolute target to peak emissions at 65 MtCO2e

(million tonnes of carbon dioxide equivalent) around 2030. Singapore’s LEDS builds on

this enhanced NDC by aspiring to halve our emissions from its peak to 33 MtCO2e by

2050, with a view to achieving net zero emissions as soon as viable in the second half

of the century. It is our hope that our announcement will encourage other Parties to do

likewise, thereby strengthening the momentum of global climate action and ensuring

that we seize this opportunity to implement an inclusive and sustainable recovery from

COVID-19.

More information on Singapore’s Whole-of-Government efforts on climate change can

be found on the National Climate Change Secretariat, Strategy Group, Prime Minister’s

Office (NCCS) website.

RECENT HIGHLIGHTS

2020

· Singapore’s Chief Negotiator for Climate Change represented the then-Minister

(Environment and Water Resources) at the 4th MoCA held virtually on 7 July

2020. MoCA is an informal ministerial meeting co-convened by the EU, China

and Canada for countries to discuss and advance issues under the UNFCCC.

· Minister (Sustainability and the Environment) Grace Fu led Singapore’s

delegation to the virtual Ministerial Meeting of the ‘Online Platform on

Sustainable and Resilient Recovery from COVID-19’ on 3 September 2020.

 The Meeting was an opportunity for countries and stakeholders to discuss

ways to pursue a green and sustainable recovery from COVID-19.

· Minister (Sustainability and the Environment) Grace Fu made a virtual

introductory call on UNFCCC Executive Secretary Patricia Espinosa on 11

September 2020. They discussed ways to maintain the momentum of climate

discussions amid the COVID-19 pandemic, including how to advance

negotiations on outstanding issues under the PAWP. Minister assured

Espinosa of Singapore’s commitment to work towards a low-carbon and

climate-resilient future.

· Singapore co-hosted the virtual ASEAN-COP-26 Climate Dialogue with the UK

COP-26 Presidency on 24 to 25 September 2020. This was the first joint

initiative under the new ASEAN-UK Cooperation Framework on COP-26.

2019

· Then-Minister (Environment and Water Resources) Masagos Zulkifli attended

the 3rd Ministerial Meeting on Climate Action (MoCA) in Brussels, Belgium

from 27 to 28 June 2019.

· PM Lee Hsien Loong spoke at the United Nations Secretary-General’s Climate

Action Summit (CAS) in New York on 23 September 2019. The CAS aimed to

boost ambition and accelerate action to implement the Paris Agreement

through the convening of nine Coalitions comprising UN Member States, and

 other key stakeholders tasked with producing concrete deliverables on

different aspects of climate action.

GENERAL CONCLUSION

A final conclusion is that, in order to avoid future conflicts, it is important to plan ahead

for the changes that human activity and rivalry over resource use may cause. This will

help society and its environment have a more harmonious relationship.

Sources:

https://www.mfa.gov.sg/SINGAPORES-FOREIGN-POLICY/International-Issues/Climate-

Change
 CHAPTER 5

BALANCE OF PAYMENTS WITH COMPONENTS

This chapter discusses the balance of payments and the debt condition of the country
over the past years and the policies implemented in accordance to the situations
presented.

Figure 5.1
Current Account Balance

CURRENT ACCOUNT

The current account surplus narrowed to $25.7 billion in the fourth quarter, from

$26.7 billion in the third quarter (Exhibit 5.1). For 2021 as a whole, the current

account surplus rose by $16.4 billion to $96.6 billion (18.1 percent of GDP). The

increase was driven primarily by a larger surplus in the goods balance. The

services account surplus also saw an increase. At the same time, a smaller
 deficit in the secondary income balance more than offset the slightly larger deficit

in the primary income balance.

Figure 5.2
Current Account Balance

In terms of the sub-components of the current account, the goods account surplus

increased by $2.7 billion from the third quarter to $43.1 billion in the fourth quarter, as

exports grew more quickly than imports (Exhibit 5.2). Similarly, for 2021 as a whole, the

goods balance registered a larger surplus of $159 billion, compared to the $143 billion

recorded in 2020, as the exports of goods increased by more than imports.

Figure 5.3
Components of Current Account Balance
 The surplus in the services balance came in at $0.3 billion in the fourth quarter, lower

than the $2.9 billion surplus in the preceding quarter. However, for the whole of 2021,

the surplus in the services balance widened to $8.4 billion, from $8.1 billion in 2020.

This was driven mainly by a shift from net payments to net receipts for other business

services, lower net payments for travel services and charges for the use of intellectual

property, and an increase in net receipts from financial services and maintenance &

repair services. These more than offset the higher net payments for transport services,

manufacturing services on physical inputs owned by others, as well as

telecommunications, computer & information services. For the primary income balance,

the deficit increased by $1.4 billion from the previous quarter to $16.1 billion in the

fourth quarter. For the year as a whole, the deficit widened slightly by $0.5 billion to

$64.3 billion, as payments rose more than receipts.

DEBT CONDITION
 Figure 5.4

Singapore Government Debt to GDP

By the end of 2022, Trading Economics' global macro models and analysts' predictions

predict Singapore's government debt to GDP to be 141.00 percent of GDP. Our

econometric models predict that, over the long term, the Singapore Government Debt to

GDP will tend to trend around 140.00 percent of GDP in 2023.

POLICIES IMPLEMENTED

A growing amount of public spending has been allocated to social spending as our

society gets older and more developed. We practically quadrupled our social investment

over the past ten years, going from $20 billion in Financial Year (FY) 2010 to $37 billion

in FY2019. Today, the majority of annual government expenditures are on social

programs. Spending on healthcare has risen over the past ten years, and a major

portion of the increase has gone into enhancing its quality, accessibility, and

affordability.
 Figure 5.5
Breakdown of Total Expenditure by Sector for Fiscal Year 2010 and Fiscal Year 2019

PLANNING FOR THE LONG TERM

Singapore's fiscal policy is distinguished by a strong long-term perspective. We make

extensive plans in advance to address longer-term issues like aging and climate

change. By doing this, we can effectively intervene upstream and prevent more

expensive interventions downstream. It also helps us to assist in the challenges'

adjustment for our society and economy.

Figure 5.6
Planning for the Long-Term
 To address the requirements of our aging population, government spending on

healthcare will particularly continue to climb. This will contribute to improving the quality

of life and healthcare for our senior citizens.

Figure 5.7
MOH Total Expenditure ($ billion)
SPENDING FOR OUTCOMES

Government expenditure as a share of GDP is among the lowest across advanced

economies

Figure 5.8

Overall Government Expenditure (%GDP, 2019)

Even while our government spends a smaller percentage of GDP than other

governments, we place more emphasis on spending quality than quantity. Despite low

levels of spending as a percentage of GDP, we have continuously produced results that

are close to the top of the world in sectors like education, health, and policing (e.g.

PISA, healthy life expectancy, Gallup law and order index).

Sources: WHO (Global Health Expenditure Database) and World Bank Data. MOF data

is proxied using MOH total expenditure

Note: Expenditure data as of 2019 - For Singapore we used 2019 for GDP, FY2019 for

healthcare spending. For other countries, healthcare spending is as % of GDP is 2019

or latest avail year. Life expectancy as of 2019 - latest available is 2019

Figure 5.9

Good Outcomes for Education Spending

Sources: UNESCO Institute for Statistics, OECD, MOF.

Data for Singapore is proxied using MOE total expenditure.

Note: Expenditure - For Singapore we used 2019 for GDP, FY2019 for education

spending. For other countries, education spending as % of GDP is 2019 or latest avail

year. PISA scores - latest available is 2018.

STEWARDING OUR RESOURCES FOR THE FUTURE

Less than the initial amount of $52.0 billion announced at the Fortitude Budget in F.Y.

2020, the draw on reserves will reach up to $42.9 billion from F.Y. 2020 to F.Y. 2022.

This is in part due to our prompt and effective reaction to the epidemic, which allowed

us to avoid much severe consequences for public health. It illustrates our prudent

utilization of reserves.

Figure 5.10

Revenue
Overall Fiscal Position in the Fiscal Year 2022

Revised Estimated Change Over

FY2021 FY2022 Revised FY2021

%
$billion $billion $billion
change

OPERATING REVENUE 80.37 81.75 1.39 1.7

Less:

TOTAL EXPENDITURE 98.41 102.41 4.00 4.1

PRIMARY SURPLUS / DEFICIT1 (18.04) (20.65)

Less:

SPECIAL TRANSFERS2 7.90 6.24 (1.66) (21.0)

Special Transfers Excluding Top-ups to Endowment

7.90 2.19
and Trust Funds

BASIC SURPLUS / DEFICIT3 (25.94) (22.84)

Top-ups to Endowment and Trust Funds - 4.05

Add:

NET INVESTMENT RETURNS CONTRIBUTION 20.33 21.56 1.23 6.0

Less:

INTEREST COSTS AND LOAN EXPENSES4 0.005 0.10 0.10 n.a.

OVERALL BUDGET SURPLUS / DEFICIT (5.61) (5.43)

Add:

CAPITALISATION OF NATIONALLY SIGNIFICANT

0.66 2.40 1.74 265.4
INFRASTRUCTURE

Less:

DEPRECIATION OF NATIONALLY SIGNIFICANT

- - - -
INFRASTRUCTURE

OVERALL FISCAL POSITION (4.95) (3.04)

GENERAL CONCLUSION

Singapore's overall balance of payments decreased from $30.1 billion in the third

quarter of 2021 to $4.9bn in the fourth quarter. Net capital outflows accounted for the

majority of this drop. At the end of 2021, the foreign ministry of Singapore increased its

reserves to $563 billion.Singapore's government debt will reach 141.00% of GDP by the

end of 2022, according to Trading Economics' econometric models. The Singapore

Government Debt to GDP ratio is expected to hover around 140.00 percent of GDP in

2023, compared to its current level of 130.00%.Singapore's budget aims to ensure a

just and forward-thinking fiscal system, investing for the long term, and maintaining a

budget that is balanced. Over time, Singapore's budgetary policies have helped the

country grow. They want to make macroeconomic stability easier, encourage economic

growth, and make social justice better.

REFERENCES:

https://www.mof.gov.sg/policies/fiscal
https://data.worldbank.org/indicator/BN.CAB.XOKA.CD?locations=SG
 CHAPTER 6

FINANCE AND FISCAL POLICY FOR DEVELOPMENT

This chapter discusses the various tools of fiscal policy such as budget, taxation,

public expenditure, public works, and public debt can go a long way for maintaining full

employment without inflationary and deflationary forces in underdeveloped economies.

RECENT INFLATION, INTEREST RATES (CENTRAL BANK) IN RELATION TO

MONETARY SITUATION

Figure 6.1

Inflation Rate in Singapore

Source: https://www.macrotrends.net/countries/SGP/singapore/inflation-rate-cpi
 The data shows the inflation rate in Singapore from 2012 to 2021. In 2021, the

inflation rate in Singapore is 2.30% which is higher compared to the previous year.

Singapore inflation rate for 2021 was 2.30%, a 2.49% increase from 2020. Monetary

policy in Singapore is centered on the exchange rate. In the small and open Singapore

economy, the exchange rate is the more effective tool for maintaining price stability.

In a market economy such as Singapore, most prices are determined by the

interaction of demand and supply in the marketplace. As such, economists generally

attribute the causes of inflation to either demand or supply factors, with different

implications for the conduct of monetary policy.

In Singapore, as in many countries, the most common measure of inflation is the

annual percentage change in the Consumer Price Index (CPI). The CPI does not

represent the general cost of the financial state, but rather the cost of a predefined

basket of goods and services typically consumed by resident households. A measure

based on consumer prices seems the most relevant since everyone, regardless of their

profile, is a consumer. The CPI is compiled by the Department of Statistics (DOS) on a

monthly basis.

Figure 6.2

Recent Interest Rates in Singapore

 Source: https://tradingeconomics.com/singapore/interest-rate

The Monetary Authority of Singapore tightened monetary policy for the fourth

time this year, saying it will re-center the mid-point of its exchange rate-based policy

band up to current levels while maintaining the slope and width of the band unchanged.

Policymakers expressed alarm about rising inflation, which is near 14-year highs, while

independent statistics showed the country's GDP expanded by a

stronger-than-expected 4.4 percent in the third quarter.

The central bank stated that the midpoint of its exchange rate policy band will be

re-centered "at the current level" of the Singapore dollar nominal effective exchange

rate (S$NEER). It will also slightly raise the rate of appreciation of the policy band.

There will be no change to the width of the policy band. The MAS boosted its core

inflation prediction for 2022 to 2.5 to 3.5%, up from 2 to 3% in January. Inflation is

expected to average 4.5 to 5.5%, up from 2.5 to 3.5% before.

 Looking ahead, the central bank expects core inflation to be about 5% for the rest

of 2022 and into early 2023, owing to high imported inflation and substantial wage

increases in an otherwise tight labor market. In terms of GDP growth, Singapore's

economy would most certainly decelerate as global demand weakens.

RECENT TAX REVENUE COLLECTION POLICY IN RELATIONSHIP OF FISCAL

POLICY

Singapore's tax-to-GDP ratio was 12.8% in 2020, below the Asia and Pacific (28)

average of 19.1% by 6.3 percentage points. It was also below the OECD average

(33.5%) by 20.7 percentage points. The tax-to-GDP ratio in Singapore decreased by 0.4

percentage points from 13.2% in 2019 to 12.8% in 2020. From 2007 to 2020, the

tax-to-GDP ratio in Singapore decreased by 0.4 percentage points from 13.2% to

12.8%. The highest tax-to-GDP ratio in this period was 14.0% in 2

008, and the lowest 12.4% in 2009.

In the OECD classification the term “taxes” is confined to compulsory unrequited

payments to the general government. Taxes are unrequited in the sense that benefits

provided by the government to taxpayers are not normally in proportion to their

payments. Tax structure refers to the share of each tax in total tax revenues. The

highest share of tax revenues in Singapore in 2020 was derived from corporate income

tax (30.3%). The second-highest share of tax revenues in 2020 was derived from

personal income tax (20.8%). Singapore’s fiscal policies have helped to steward the

country’s progress over the years. They aim to create the conditions for macroeconomic
stability, support economic growth, and promote social equity. We achieve this by

maintaining a balanced budget, investing for the future, and ensuring a fair and

progressive fiscal system.

The Singapore's government follows a conservative budgetary strategy that is

primarily utilized to provide vital goods and services. As a result, government spending

on domestic goods and services in Singapore amounts to a modest fraction of national

revenue. As a consequence, except for the recession years when the fiscal stimulus

was implemented, Singapore's government has continuously generated minor budget

surpluses. This has allowed the Singapore government to accumulate significant

reserves over the past few decades. Due to Singapore's low marginal propensity to

consume, small consumption expenditure, investment expenditure, and government

expenditure on domestic goods and services as components of aggregate demand, and

small multiplier, expansionary fiscal policy is generally not used to boost economic

growth in non-recession years. In the case of a recession caused by a drop in exports

in Singapore due to the country's high reliance on external demand, with domestic

exports accounting for a large proportion of aggregate demand, the government will use

expansionary fiscal policy as part of a policy mix to boost economic growth.

General Conclusion

As a result, other than the recession years during which fiscal stimulus was

implemented, Singapore's government has consistently achieved minor budget

surpluses. This has allowed the Singapore government to accrue large reserves over
the previous few decades. Expansionary fiscal policy is generally not used to boost

economic growth in non-recession years. Due to Singapore's low marginal propensity to

consume, small consumption expenditure, investment expenditure, and government

expenditure on domestic goods and services as components of aggregate demand, and

small percentage increase.

References:

https://www.macrotrends.net/countries/SGP/singapore/inflation-rate-cpi

https://www.mas.gov.sg/-/media/MAS/Monetary-Policy-and-Economics/Education-and-R
esearch/Education/Explorer/Economics-Explorer-2-Inflation.pdf

https://www.mas.gov.sg/-/media/mas/resource/publications/fsr/financial-stability-review-
2021.pdf

https://tradingeconomics.com/singapore/interest-rate

https://www.oecd.org/tax/tax-policy/revenue-statistics-asia-and-pacific-singapore.pdf

https://www.mof.gov.sg/policies/fiscal

https://www.economicscafe.com.sg/economics-lecture-notes-chapter-12/
 CHAPTER 7

COMPARATIVE ECONOMIC DEVELOPMENT

REAL INCOME

After achieving independence on 1960’s, Singapore experienced a sudden economic

growth. In fact, over the same period, Singapore’s GDP per capita was more rapid than

any other countries. Singapore is labeled as one of the high-income countries all over

the world. Its GDP per capita averaged 27144.51 USD from 1960 until 2021.

The Gross Domestic Product per capita in Singapore was last recorded at 66176.39

US dollars in 2021, a record low of 3612.02 USD in 1960. The GDP per Capita in

Singapore is equivalent to 524 percent of the world&#39;s average. (Trading

Economics)

In the most recent World Bank Human Capital Index, Singapore ranks the best

country in the world in human capital development. This means that a child born today

in Singapore will be 88% as productive when she grows up, as if she enjoyed complete

education and full health. Together with strong financial support from the government,

the country continues to strengthen the nimbleness and flexibility of its workforce by

providing continuing and quality education.

Government spending on continuing education will nearly double, to more than

$1 billion yearly. The country is also ranked among the world’s most competitive

economies for its outstanding performance and providing most business-friendly

regulatory environment. Just like other countries it also started being a low-income into

a high-income economy with an average GDP of 7.7% since independence and 9.5% in

the first 25 years after independence. Value-added manufacturing, particularly in the

electronics and precision engineering sectors, remain key drivers of growth, as are the

services sector, particularly the information and communications industries, which grew

6.0% year-on-year, and the finance, insurance industries, which grew 5.9% year-on-

year. Economic growth is expected to moderate in 2019, with the government

forecasting a range of 1.5% to 3.5%, projecting the rate to be slightly below the middle

of the forecast range.

Figure 7.1
GDP Growth (Annual)
Source: https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locations=SG

Figure 7.2
GDP Per Capita (US $) Annual Growth Rate

Source: https://www.macrotrends.net/countries/SGP/singapore/gdp-per-capita

Figure 7.3
Annual Growth Rate
Source: https://www.macrotrends.net/countries/SGP/singapore/gdp-per-capita

HEALTH IN SINGAPORE

Today Singapore ranks 12 th in the world in healthcare outcomes well ahead of many

developed countries. (International Trade Administration). The results are all the more

significant as Singapore spends less on healthcare than any other high-income

country,both as measured by dividing GDP spent on health and by costs per person.

Singapore’s healthcare has the most effective facility and system in the world. By

every measurement, it performs exceedingly well. The country placed 6th in the World
Health Organization’s ranking of the world’s health systems in the year 2000, a position

it has held to the present day. The Economist Intelligence Unit placed Singapore 2nd

out of 166 countries for health-care outcomes. The Bloomberg Global Health Index of

163 countries ranked Singapore the 4th healthiest country in the world.

The country inherited a largely tax-based public healthcare system with basic and

rudimentary standards from Britain. The government felt that welfarism wasn’t a viable

option because it bred dependency on the state. So they encourage people to practice

personal responsibility wherein they are in charge of their own welfare. In this

implementation, Singapore has indeed achieved a great deal in a short period and

recognized this approach as an alternative well worth considering according to

Affordable Excellence.

This superb level of healthcare means that Singaporeans enjoy an extremely high

standard of living. And, as of 2019, Singaporeans had the world’s longest life

expectancy at 84.8 years. Singapore’s universal healthcare is based on public and

private facilities. Singapore citizens and permanent residents are entitled to subsidized

healthcare services because they contribute to Singapore’s “three M’s”. The Medisave

program is a forced savings plan that represents between 7% and 9.5% of a working

person’s wages. Naturally, not all healthcare expenditures fall under the realm of routine

care, nor are they all affordable for the average Medisave account. That’s where

Medishield comes in.

 Medishield is like a nationwide catastrophic insurance program. While it’s possible to

opt-out of Medishield Insurance, most Singaporeans see it as a good value. If a

Singaporean had so many health concerns in a year that have been used up all the

money in the Medisave account, the insurance with Medishield kicks in. Medifund is a

fund whereas the Singapore’s government uses the fund's investment to pay medical

bills for those in financial need.

EDUCATION IN SINGAPORE

Ever since Singapore became an independent republic in 1965, it has transformed

from an impoverished island with no natural resources and a mostly illiterate population

to a country of 5.8 million people whose living standards match those of the most

highly-developed industrial nations. From the very beginning, Lee Kuan Yew, the prime

minister who led Singapore to this achievement, understood that an educated workforce

would be essential to fulfilling his ambitious economic goals.

At the end of World War II, Singapore implemented the first in a succession of

economic development strategies rooted in improved education and training. The nation

has focused on boosting creativity and capacity for innovation in its students. In 2004,

the government developed the “Teach Less, Learn More” initiative, which moved

instruction further away from its early focus on rote memorization and repetitive tasks

and toward deeper conceptual understanding and problem-based learning. Educators

abandoned the practice of funneling students into ability-based tracks and began sorting

them into three different “bands” in secondary school based on their ultimate

educational goal. Although students take most of their classes within their bands, they
can take classes in other bands depending on their aptitude and interest in a given

subject. The goal is to achieve full subject-based banding, with students freely mixing

and matching classes from different bands, by 2024.

Singapore’s current priorities for its education system are reflected in the title of its

initiative “Every School a Good School.” This set of reforms aims to ensure that all

schools have adequate resources to develop customized programs for their students;

raise professional standards for teachers; encourage innovation; and foster partnerships

between schools and communities. In addition, Singapore launched the “Learn for Life”

initiative in 2018 to promote greater flexibility in teaching, learning, and assessment.

With more opportunities for self-directed learning in and out of school, Singapore hopes

to encourage lifelong learning for all Singaporeans, in ways that bring them satisfaction

and meaning.

Despite Singapore’s strong emphasis on educational equity, there remains a large gap

between the nation’s highest-performing and lowest-performing students on Programme

for International Student Assessment (PISA). This gap, which persists across all three

subjects, narrowed somewhat in mathematics and science in the latest round of

Programme for International Student Assessment (PISA). In addition, Singapore stands

out among The Organization for Economic Cooperating and Development (OECD)

countries for its low percentage of low-performing students and high percentage of

high-performing students, including a very high percentage of top-performing students

with low socioeconomic status. Ten percent of disadvantaged students in Singapore

are in the top-performing group compared to an OECD average of three percent.

HOLISTIC MEASURES OF LIVING LEVELS AND CAPABILITIES

Singapore is one of the countries with a high Human Development Index. With an HDI

of 0.925, Singapore is tied with Denmark at number five. However, that value is quite

impressive, and is reflective of the high level of human development in Singapore. The

average value for Singapore during that period was 0.851 points with a minimum of

0.718 points in 1990 and a maximum of 0.938 points in 2020. The latest value from

2020 is 0.938 points.

The HDI is a composite index that measures the level of human development in

countries using three variables: life expectancy at birth, mean and expected years of

schooling, and gross national income per capita. According to the 2015 values for

Singapore, the country has a life expectancy of 83.2 years at birth, a mean number of

11.6 years and an expected number of 15.4 years of schooling, and a GNI per capita of

78,162 USD. Additionally, according to the HDI data, Singapore has the second highest

life expectancy at birth after Japan, and the second highest GNI per capita after Qatar.

Singapore’s high life expectancy can be attributed to a very successful healthcare

system, where high quality care is both easily accessible and affordable. The system

relies both on strong private sector spending and the use of Health Savings Accounts,

as well as robust government programs like Medishield and Medifund.

Singapore’s high GNI per capita can be attributed to a strong export-oriented economy

with a business-friendly environment of low taxes, low tariffs, and few capital

restrictions. Today, Singapore is a global financial center despite having few natural
resources, a transformation largely credited to Lee Kuan Yew, the first Prime Minister

who oversaw major economic reforms.

Figure 7.4
Human Development Index of Singapore

GENERAL CONCLUSIONS

Today, Singapore's economy is one of the most stable in the world, with no foreign

debt, high government revenue and a consistently positive surplus. Singapore has

attracted major investments in advanced manufacturing, pharmaceuticals, and medical

technology production and will continue efforts to strengthen its position as Southeast

Asia's leading financial and technology hub.

 Singapore’s high life expectancy can be attributed to a very successful healthcare

system, where high quality care is both easily accessible and affordable. The system

relies both on strong private sector spending and the use of Health Savings Accounts,

as well as robust government programs like Medishield and Medifund. The Singapore’s

government is on its way to restructure Singapore’s economy to reduce its dependence

on foreign labor, raise productivity growth, and increase wages amid slowing labor force

growth and an aging population.

Sources:

https://www.internationalinsurance.com/health/systems/singapore.php

https://ncee.org/country/singapore/

https://www.theglobaleconomy.com/Singapore/human_development/

https://countryeconomy.com/hdi/singapore

https://www.thoughtco.com/singapores-economic-development-1434565

https://www.csc.gov.sg/articles/opinion-singapore%27s-economic-growth-model-too-mu
ch-or-too-little