№2, 2018

Editorial Page

The Singapore Miracle as an Example of a Highly Successful Governmental Policy

Julia Kuznetsova

Author: Kuznetsova Julia. A second-year student/ School of Governance and Politics 

Abstract: Public administration has already been a separate field of science for a long time. Many countries are trying to find their own unique way of development: to build an effective management structure, to increase a level of economic development, to improve a standard of living. All countries follow their strategy, using various methods, implementing reforms. In order to determine the most optimal strategy for a given country, it is necessary to take into account experience of other countries. To take the best, weed out the superfluous, unsuitable for a country and develop its own development strategy is the main task of any state. In this article Singapore is an object of my analysis. It is, perhaps, the most striking example of the concept of "economic miracle." If you think about the initial situation that this small island had near the equator, "miracle" is indeed unbelievable.  I propose to study the specific methods of public administration, which was the key to such an overwhelming success.

Key words: economic miracle, public administration, government, external and internal policy, labour and investment resources, social sphere.

The lack of natural resources, the limited territory, the impoverished and little educated population - that was the condition of Singapore, when it gained independence in 1965. Singapore now is a country of banks, skyscrapers, beautiful roads and the world's best systems of taxation, education and health. What made such a wonderful transformation possible?

To begin with, in order to understand the nature of events taken place in this country, it is necessary to mention its history. The United Kingdom fought with Holland for these territories since the beginning of the XVII century for almost a hundred years and, in the end, took over them. Becoming a colony, Singapore immediately became the part of the British East India Company. The United Kingdom used Singapore as a trading point on the way to deliver British goods to China.

For the development of colonial policy the British required the most modern infrastructure in Singapore, and they built it: a crossing over the Johor Pass, connecting the island with the mainland, a railway through Malacca to Bangkok and etc. But although the territory developed, that couldn’t be related to the quality of life of the population. All that "prosperity" was accomplished by the ruthless exploitation of the local people. Nevertheless, the prerequisites for the development of capitalism were gradually developing.

In 1948 the colonial peoples began their struggle for independence. In order to maintain the dominance over those territories the British imperialists created the so-called "Malayan Union". There were Malayan states and parts of the former British Crown Colony Straits Settlements - Penang and Malacca. Singapore, previously part of this colony, became a separate colony. However, the anti-colonial struggle intensified. In 1959, as a result of negotiations, Singapore was proclaimed an "autonomous state" within the framework of the British Commonwealth, and in 1965 became an independent state.

After separation from Malaysia Singapore was in a difficult situation - without the army and support, between conflicting Indonesia and Malaysia, with social and economic problems. Singapore had no natural resources, the country was experiencing difficulties even with the supply of drinking water, which was taken from unfriendly Malaysia.

The starting point of the country's development began when lawyer Lee Kuan Yew, a Chinese by birth, came to power. From that moment his government began  to develop and then follow the strategy of the country’s development with methodical precision, in which each link was a continuation of the previous one and took into account changing circumstances. It was under the leadership of that great man that the country managed to move from the category of "third world" countries to the category of the developed ones. From 1965 to 1990 Lee directly headed the Singaporean government. For that quarter of a century the key indicator of well-being - the per capita GDP level in the country – grew from $ 400 to $ 12.2 thousand.

The secret of the Singapore miracle is hidden in the unique approach of Lee Kuan Yew to the development of the country. The unusual policy of the prime minister is based on the desire to revive the country with the help of successful and developing people. An important feature of Singapore was also the fact that the country did not have its own people. About three quarters of the population were Chinese, another 15% were Malays, and an actively growing Indian minority was also present. The relationship between those groups was not always smooth. How was it possible to unite and develop the country in such conditions? Lee Kuan Yew emphasized that all citizens of the state should be immensely interested in their personal growth and high incomes. That was his key point.

The politician stressed that the sense of ownership was vitally important for their society, devoid of deep roots. Lee encouraged the purchase of houses by families and the elimination of slums. According to the Prime Minister, in this case the owners are tied to the "father's house", for which they are ready to give their lives. In addition, the owners are much more sensitive to the choice of politicians, which  provides the country with even greater stability.

Since gaining independence English became a "neutral" language of communication, which was impossible for Chinese, Malay or Tamil. The spread of English also increased the attractiveness of Singapore for international investors. It was their arrival in the country that became the turning point of its history.

His whole policy, both external and internal, can be called a "moderate course." In foreign policy, the "moderate course" of the new government was expressed by suppressing the anti-colonial struggle of its population and making a compromise with the British imperialists. The authorities, led by the "father of the Singapore miracle," feared that the liberation struggle of the Singaporeans against the colonialists could turn into a struggle against their own oppressors.

The political system of Singapore had a little bit of both liberalism and authoritarianism and continues to be the same. At one time, Lee Kuan Yew rightly assumed that democracy in conditions of poverty would lead to even greater chaos. Therefore, Lee put things in order, using sometimes rather harsh methods in the form of banning rallies, censorship and personal ballots but at the same time maintaining market relations in the economy itself.

 He methodically cleared the ground for building state-monopoly capitalism in his country. In particular, for that purpose he organized a brutal persecution of the Communists. Such anti-communist policy Lee Kuan Yew began even before, in 1965, when Singapore remained a colony of Great Britain. After gaining independence, he continued and toughened the persecution of Communists, made it the part of the state policy.

Lee Kuan Yew is also known for the effective eradication of corruption. It is the common fact that corruption is an inalienable attribute of capitalism. State-monopoly capitalism is the most favorable, ideal environment for corruption. The MMC gives unlimited number of opportunities for corruption. Therefore, to reduce corruption in the MMC was possible only by using dragon measures, hard-power actions of state-monopoly system. That was exactly how Lee Kuan Yu worked.

The fight against corruption began "by simplifying decision-making procedures and removing all ambiguity in laws." The salaries of judges were sharply raised, "the best private lawyers" were brought to judicial posts. The salary of the Singaporean judge reached several hundred thousand dollars a year (in the 1990's - over $ 1 million). In his memoirs, the politician recalled that the fight against bribery went from top to bottom, from the highest ranks, which was the main reason for its success. An independent body was created to combat corruption in the highest echelons of power (investigations were initiated even against close relatives of Lee Kuan Yew). Somehow, when the prime minister was asked how to start the reforms, he replied: “Start with putting three of your friends to jail. You definitely know what for, and people will believe you”.

Speaking about the social sphere, as mentioned above, Lee made every effort to develop a sense of ownership among Singaporeans. Nowadays this field is extremely developed.

Each employee contributes 20% of his earnings to special funds, the same is done by his employer, and when the amount of accumulated funds is 20% of the cost of housing, a person has the right to settle with his family in luxury apartments. Today, most of the inhabitants of skyscrapers became the full owners of their 4-5 room apartments. The pension savings system is built in such a way that every elderly Singaporean has enough money for a comfortable existence.

Economy of Singapure. Since the country was almost completely devoid of natural resources, Lee decided to develop mostly labour and investment resources.

From the outset Singapore declared transparent rules of doing business and a loyal tax system. There was almost no competition and as a result the country's macroeconomic stability only increased. The country welcomed every investor, and today more than 3,000 companies are open in the country. The annual volume of foreign investment is 10 billion dollars, and this is with a huge domestic investment potential.

 From the beginning it was decided to give all children the same development conditions. Among children's schools and kindergartens there was no division. Every year, every school conducted tests for IQ, which were organized by English scientists. The children who showed the best results automatically became pupils of the best school Raffles. It was here where the future leadership of the state was trained.

The salaries of civil servants now are as high as the ones of top managers of private corporations. Therefore, in Singapore working in public service is considered to be very prestigious.

Now the main industries are microelectronics, pharmaceuticals. The Singapore economic miracle cannot be imagined without integration into the world banking system. The country got the status of the financial center for the fact that it made possible a 24-hour banking service. Due to the specifics of time zones, the financial world of some countries had previously «slept» in certain hours . Today this niche belongs to the banking segment of Singapore.

Thus, the economic miracle of Singapore  is still the benchmark for many countries. In 2017 Singapore took the second place in the rank of convenience of doing business, according to the World Bank. In 2015 it took the 6th place in the Human Development Index which is calculated by the UN. It was an overwhelming success and it is not a surprise that many countries tried to adopt this system, but borrowing such experience for other countries, one must take into account the specifics. All this super-fast economic growth was made by an authoritarian modernization unusual for the West: without strong opposition, free media and with almost irremovable power. However, we should admit the fact that in the case of Singapore, this system is very well established. Lee's death allows us to make sure that the system he built will remain viable even without the patronage of its founder, and the country will continue to prosper.


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