GIBS

12 Pillars of Global Competitiveness: Singapore

Dr. SUNITA JINDAL
ANUJ KAUL(287), NIPUN CHAWLA(278) 4/3/2013

12- Pillars of Global Competitiveness: Singapore inside Review

Singapore retains its place at 2nd position as a result of an outstanding performance across the entire Index. The country features in the top 3 in seven of the 12 categories of the Index and appears in the top 10 of three others. Its public and private institutions are rated as the best in the world for the fifth year in a row. It also ranks 1st for the efficiency of its goods and labor markets, and places 2nd in terms of financial market development. Singapore also has world-class infrastructure (2nd), with excellent roads, ports, and air transport facilities. In addition, the countrys competitiveness is reinforced by a strong focus on education, which has translated into a steady improvement in the higher education and training pillar (2nd) in recent years, thus providing individuals with the skills needed for a rapidly changing global economy.

1. Singapore is attuned to the needs of businesses and the need to protect invention and innovation Singapore is known for integrity, quality, reliability, productivity, rule of law, and enforcement of intellectual property rights. These assets are essential in the knowledge economy. Singapore keeps its tax rates and tax laws competitive and takes a strategic, holistic approach towards stewardship of key pillars of the economy, such as petrochemicals, electronics, and clean energy. Most recently, it has mounted an initiative called Future Singapore. This is designed to develop and test bed new ideas and solutions in the areas of urban living, wellness, ageing and healthcare, and lifestyle products and services. As a preferred location for innovation, Singapore has nurtured a robust intellectual property (IP) regime .The country has placed a great deal of commitment into developing a strong domestic regulatory framework to protect IP rights. It is currently rated the best place in Asia and 7th in the world for IP rights protection in the IMD World Competitiveness Report 2011. Similarly, the World Economic Forums Global Competitiveness Report 2011-2012 ranks the island as having the best IP protection in Asia, and the second best in the world. Indeed, a consistently reliable IP environment was what spurred the World Intellectual Property Office (WIPO) in 2009 to set up its first Asian regional office here. And because of its pro-IP stance, more than 30 leading biomedical sciences companies have established regional headquarters here as well. 2. The worlds top labour force sustains Singapores leadership position in key knowledgeintensive industries The multi-cultural Singaporean workforce is highly educated, highly motivated and highly productive. It is also proficient in English the language of international business. Singapore has a large base of engineering talent, with the number of engineers in universities and polytechnics expanding steadily each year, in addition to the sizeable pool of skilled technicians. An open immigration policy has served to enhance Singapores talent pool. This gives companies the opportunity to source for the best personnel from anywhere in the world. In addition, a vast array of training and scholarship programmes are frequently developed by the government in tandem with industry partners and educational establishments. Such initiatives ensure that the workforce is future-ready. All this has helped produce a labour force that is ranked No.1 in the world over the last 30 years. (Business Environment Risk Intelligence's 2008 Labour Force Evaluation Measure report). Rapid business innovation requires world-class R&D facilities and expertise. The Agency for Science, Technology and Research (A*STAR) ensures that Singapore has both in ample supply. With twelve research centres dedicated to a multitude of technological disciplines, Singapore attracts a world class community of researchers and specialists from the US, Europe and Asia Pacific region. In the last decade, Singapore has successfully grown its R&D base, drawn top scientific and creative talent and nurtured R&D collaborations between the public sector and private enterprise. Today, Singapore holds global leadership positions in areas of manufacturing such as electronics and petrochemicals. The city-state remains an attractive base for complex manufacturing activities, in tandem with its move towards a more knowledge-centric and research-based economy. This emphasis on innovation and capital-intensive activities and a globalised workforce has shaped Singapore into a city-state where Chinese and Indian companies can internationalise, where American and European companies make their entry into Asia, and where views on the future of this dynamic and fast-evolving region can be forged.

3. Global transportation hub with the most extensive network of trade agreements in Asia Singapore has built on its advantageous geographical location to become one of the worlds top transportation hubs for sea and air cargo. Singapores container ports are the busiest in the world. They offer a choice of 200 shipping lines with links to some 600 ports in 123 countries. Changi International Airport is linked to some 200 cities in 60 countries, with about 5,400 weekly flights, providing convenience and effective connectivity for passengers and cargo. The Changi Airfreight Centre is a 24-hour, one-stop hub for the storing, moving and repackaging of goods without the need for documentation and custom duties. This has drawn some 6,000 logistics providers to Singapore, including 21 of the world's top 25 third-party logistics providers. Getting around the island is effortless with the highly-efficient Mass Rapid Transit system, and bus and taxi services. On the infocomms front, the countrys broadband network reaches 99 per cent of the population. International and regional connectivity now stands at 27.6 Tbps to more than 100 countries. Companies here have the necessary land, air, sea, and telecommunications linkages necessary to move freight and services anywhere in the world, whenever they are needed. Singapores extensive trade links provide companies with greater market connectivity through the reduction of tariff and non-tariff barriers. The Republic currently has the most extensive network of free trade agreements (FTAs) in Asia. Agreements have been signed with key economies such as US, Japan, Australia, New Zealand, members of the European Free Trade Association, Jordan, China, Chile, South Korea, India and Panama. Negotiations are in progress for FTAs with Middle East and South Asian economies. On top of this, Singapore has signed 35 investment guarantee agreements (IGAs), designed to help protect investments made by Singapore-based companies in other countries against non-commercial risks. 4. Asias best location to work, live and play Singapore is a cosmopolitan country at the crossroads of Asia where people from the region feel right at home and those from beyond feel welcome. In fact, one in three persons here comes from abroad, constantly adding to the nation's unique heritage blend. Today, the population is a rich mix of different cultures, lifestyles and religions co-existing harmoniously. Being a consistent top performer in Mercer's Quality of Living surveys over the years, and the topranked Asian city in the 2011 survey, Singapore has taken the work-live-play approach very much to heart. The city-state is safe and orderly. Recognised as one of the cleanest and greenest cities in the world, its public transport system and healthcare services are world-class. This provides a dynamic business environment, providing plenty of work opportunities locally and overseas. In fact, there are numerous schools catering to the education needs of expatriate children while its local schooling system has achieved academic distinction. Its one of the push factors that make Singapore a great place to raise a family. Most importantly, the "play" aspect is not forgotten in the Republic. The arts and culture scene is thriving and growing. From a host of acclaimed museums, such as the ArtScience Museum located at the luxurious Marina Bay district and countless theatre and musical productions at world-class venues like The Esplanade Theatres on the Bay. Singapore is also a gastronomic draw, with a lively dining and entertainment scene that offers some of the best cuisine in Asia, as well as unique street food. The warm, sunny weather makes

all-year-round water and outdoor sports possible. There are a wide variety of well-tended green spaces and exercise facilities such as the East Coast Park and the Botanical Gardens for relaxation and fun. Singapore is also ploughing resources into state-of-the-art sporting facilities such as the Sports Hub in Kallang, which will be ready in 2014. Home for Business

It is about deeply rooting companies in Singapore and being their home away from home. Asias growth story be it China, India or ASEAN will increasingly shape global trade and investment flows. As manufacturing and service capacity shifts to Asia, coupled with the influx of engineering talent, companies increasingly turn their focus to Asia. Singapore can then be the ideal location for companies to locate some of their key decision makers to feel the pulse, spot opportunities and leverage the network of relationships in the region. Companies find in Singapore a stable and trusted base where they can exploit their knowledge and IP assets, undertake key activities which give them a competitive advantage, as well as drive their growth from Asia.

At the same time, Singapores global connectivity as well as the marketplace of thought and perspective it offers makes it an ideal neutral base from which Asian companies can expand their presence worldwide. Home for Innovation

It is about leveraging Singapores strengths in systems integration and shifting the focus from sourcing solutions to co-creating solutions with industry partners. The global trends of urbanisation, ageing and rising affluence are creating demand for new products and services solutions which Singapore itself needs. Working together with partners from both the private and public sectors, companies can tap on Singapore as a living laboratory to collaboratively conceptualise, co-create and test-bed new solutions for commercialisation in Asia and globally. In the process, the people of Singapore will enjoy greater quality of life with easy access to tomorrows leading edge solutions today. The collaboration between PUB Singapores national water agency and Toray Industries, Inc. is one of the first fruits of this initiative. The collaboration will see the two parties working to develop water treatment-related technologies and products that will help in coping with the anticipated global water shortage. In addition, Changi General Hospital has partnered Intel to test-bed the Mobile Clinical Assistant, a lightweight mobile device that provides information on patients conditions and test results to caregivers who are on the move. Home for Talent

It is about positioning the country as a hub where talent is harnessed and developed to drive business and innovation in Asia. Already a city with one of the highest quality of living standards in the world1, Singapore continues to step up efforts to attract, develop and retain

talent. Many international names have responded favourably, by setting up shop on the islands friendly, safe shores. For example, Lenovo launched a digital and social media centre of excellence, while social media giants like LinkedIn and Facebook have set up their regional headquarters here. Joining the bandwagon are renowned firms Lucasfilm Limited and DigiPen Institute of Technology global leaders in the digital industry. Singapore has also built herself up as the education hub of the region. One good example is the global consumer goods giant, Unilever. Named Unilever Four Acres Singapore, the global leadership development centre is Unilevers first corporate university in Asia. With Singapore as its base, Unilever Four Acres Singapore will attract and groom future leaders to grow its business in the desired markets. In addition to the talent development belt, leading education institutions such as the Human Capital Leadership Institute, INSEAD Asia campus and the University of Chicago Booth School of Business have also chosen Singapore as their control tower for talent in Asia.

12 Pillars of Global Competitiveness: Singapore

Reasons why the Singapore is 2nd top most competitive country

1. Institutions :

2. Infrastructure:

Singapore is well-served by air, sea and telecommunications connectivity. In telecommunications connectivity, Singapore has a nationwide broadband network infrastructure, sufficient for your every business need. As one of the world's busiest port, Singapore is the hub for about 400 shipping lines to more than 700 ports worldwide. Besides having outstanding seaport facilities, the Singapore Changi Airport is also a leading air hub renowned worldwide for its efficiency. Its quality infrastructure, skilled workforce and excellent service in cargo handling have won high acclaim from its users. The airport has garnered a total of 16 awards so far in the year 2002. Our excellent connectivity, strategic location, world-class infrastructure and congregation of global industry experts and professionals offer business executives and business event organisers opportunities

for business and knowledge exchange and the ease and convenience of doing business or organising an event. Singapores excellent air links, network readiness and trade links with key economies connect Singapore to the world, offering a truly international market for the exchange of business opportunities, ideas and products. Good telecommunications network

Singapore is one of the most competitive telecommunications hubs in the Asia Pacific. This is further enhanced by its recent liberalisation of the telecommunication industry in early 2000. Transportation

Travelling around Singapore is a cinch! An efficient public transportation network of taxis, buses and the modern Mass Rapid Transit (MRT) rail system ensures that getting from point A to point B is hassle-free and extremely affordable.

Financial System

Singapore is also well-plugged into the international financial system. It is the 4th largest foreign exchange trading centre in the world, the 5th largest trader in derivatives and the 9th largest offshore lending centre. The Singapore Exchange (SGX) is recognised as a leading stock market in Asia and one of the world's leading derivatives exchanges. 3. Macro-environment:

According to the Economist Intelligence Unit, Country Forecasts Report in December 2011, the country was ranked the most attractive as an investment location, both regionally and globally. Factors taken into consideration for ranking purposes were supportive government policies, attractive labour market conditions, a sound infrastructure and financing efficiency.

4. Health and primary education:

Singapore's education system has been described as "world-leading" and in 2010 was among those picked out for commendation by the British education minister Michael Gove. With education made compulsory, Singapore has a 96.1% literacy rate for the year 2011. 5. Higher Education and Training:

Singapore has also built herself up as the education hub of the region. One good example is the global consumer goods giant, Unilever. Named Unilever Four Acres Singapore, the global leadership development centre is Unilevers first corporate university in Asia. With Singapore as its base, Unilever Four Acres Singapore will attract and groom future leaders to grow its business in the desired markets. In addition to the talent development belt, leading education institutions such as the Human Capital Leadership Institute, INSEAD Asia campus and the University Of Chicago Booth School Of Business have also chosen Singapore as their control tower for talent in Asia

6. Goods Market Efficiency:

According to the Globalisation Index 2012, Singapore came in after Hong Kong and Ireland as the country preferred for foreign trade and investment. A number of factors have contributed to this achievement, namely the countrys strategic geographic location, connected networks with the rest of the world, strong legal system and attractive tax system. In its BERI Report 2011-II (August 2011), USbased research institute Business Environment Risk Intelligence (BERI) ranked Singapore first out of 50 major investment destinations in a ranking that assesses operations, politics and foreign exchange. With no restrictions on the repatriation of profits and the import of capital, along with the most favourable operating conditions and strong diplomatic ties, Singapores stable political and economic climate creates an ideal environment to invest in. 7. Labour Market Efficiency:

Based on the Business Environment Risk Intelligence (BERI) Report 2011-I, Singapore enjoys the highest ranking for labour force in terms of workers productivity and general overall attitude; as displayed by superior business performances with advanced technology and low labour unit costs in relation to the value of goods and services produced. According to the IMD World Competitiveness Yearbook in 2011, Singapores workforce is highly motivated; making for one of the most productive labour forces in the region. This ranking is due to effective company policies in place, a generally conducive working environment and attractive living conditions in the country. The IMD World Competitiveness Yearbook in 2011 states that Singapore has one of the most skilled labour pools in the region due to sound education policies, the ready availability of training programmes and attractive incentives for local and foreign talent. The mind-set of Singaporean talent is generally positive and makes for a productive working environment. According to

the Global Competitiveness Report 2011 2012 by the World Economic Forum, Singapore enjoys better working conditions and higher rates of productivity due to more open communication channels and camaraderie between employee and employer. s found in the Global Competitiveness Report 2011 2012 by the World Economic Forum, Singapores labour regulations are one of the most effective and flexible in Asia when it comes to hiring talent as compared to the rest of its neighbours. These include an attractive tax system and effective manpower regulations. 8. Financial Market Development :

In its BERI Report 2011-II (August 2011), US-based research institute Business Environment Risk Intelligence (BERI) ranked Singapore first out of 50 major investment destinations in a ranking that assesses operations, politics and foreign exchange. With no restrictions on the repatriation of profits and the import of capital, along with the most favourable operating conditions and strong diplomatic ties, Singapores stable political and economic climate creates an ideal environment to invest in. Investment friendly climate: FDI inflow in Singapore increased at a CAGR of 23.4 percent between 2005 and 2011. Government provides tax incentives, depreciation schemes, favorable loan conditions, and high-quality industrial estate to attract investment. Manufacturing of electronics, pharmaceuticals, and petroleum remain primary magnets for investment. Government is also trying to attract MNC investment in high-technology sectors while trying to expand the countrys role as a global financial center. 9. Technology readiness :

Residential and Corporate wired broadband subscription for the nation.

10. Market Size:

According to the Globalisation Index 2012, Singapore came in after Hong Kong and Ireland as the country preferred for foreign trade and investment. A number of factors have contributed to this achievement, namely the countrys strategic geographic location, connected networks with the rest of the world, strong legal system and attractive tax system. 11. Business Sophistication:

12. Innovation:

In its Global Competitiveness Report 2011 2012, the World Economic Forum has ranked Singapore as having the best IP protection based on the infrastructure and incentives put in place by the government to encourage innovation by existing and emerging industries.