A Conversation with Singapore Finance Minister Tharman

Every once in a while I come across a government bureaucrat who totally surprises me with the person’s insight and competence. Singapore Minister of Finance Tharman is one of them. We opened the ICSID World Congress Monday with a conversation onstage. Every nation has a governing elite but Singapore has an exceptionally competent one.

Here are my questions to the Minister. He had a chance to see them before he went onstage.

Q&A With Singapore’s Minister of Finance

Bruce Nussbaum, 2009

Mr. Finance Minister, the last time I was in Singapore was in 1969. I was told I’d better cut my long hair shorter for the visit. Today, you can see that this is no longer a problem. I wish it were.

Mr. Finance Minister, you sit at the epicenter of decision-making in Singapore. You were recently Minister of Education. You served in the Monetary Authority of Singapore. You currently chair the Economic Strategies Committee. Mr. Finance Minister, you helped shape one successful future for Singapore after 1965 and now you are helping to shape strategies that will create a second future for Singapore in the 21st century.

Indeed, Singapore and its leaders have shown a great capacity for visualizing the future. So today, I would like to have a conversation with you in front of this wonderful ICSID audience and talk about three things: 1) How did Singapore create itself over the past 40- plus years, transforming a small island with only the resources of its people into a global city-state that is a model of economic success, social unity, educational superiority and technological achievement;

2) How can Singapore re-create itself into a global city-state that is a model of creativity, originality, innovation and design-driven economic growth?

3) How does Singapore see the world today—are we at an historic inflection point that will transform the global context of the past half century into something very different in the near future? So let’s begin with the past. I understand that you are a wonderful storyteller. Can you tell us a story or two that captures how Singapore discovered and developed the capacities that have made it so successful today? Can you unpack some of the mysteries for us?

Thank you. The capacities of the past may not be the capacities needed for the future. What kind of capacities do you see Singapore needing and developing for the years ahead?

Singapore’s impressive success has come in large part from a technology-centered, engineering, top-down kind of social and economic model that is a marvel of efficiency. In 2002, the “Remaking Singapore” initiative was launched to turn Singapore into a world center of creativity, innovation, and design. These new capacities are associated with a human-centered, social science, bottoms-up model. How successful is Singapore to date in making a transition to this different kind of model? What kind of education do you need to develop original, creative young people? How do you foster creative talent and keep it in Singapore?

The city is making a big comeback around the globe. New cities are being built, megacities are rising and older cities are being renovated. What lessons can these cities, especially the megacities, learn from the city-state of Singapore, as they strive to grow and prosper? Are there transferable lessons?

Finally, just a small question. Looking at the world from the vantage point of Singapore, where are we going? How are we changing?

Thank you.”

The Finance Minister made a persuasive case for strong government intervention in the economy and in society. Compare Singapore today to what it was when I first visited many decades ago and I had to agree with his assessment of economic progress and social harmony. This country has lept from Third World status to First World nation in about 4 decades. Remarkable.

The Minister also recognized that the engineering, efficiency-driven top-down model that has given Singapore so much success needs to be augmented with a more creative, innovative bottoms-up model. The government is recognizing that new industries outside it’s usual control are cropping up—such as airplane maintenance—and has policies to move quickly to support them. In Singaporean fashion, the government is redesigning the education system to promote creativity among the young.

Will it work? I hope so but I’m not sure. Many of the young Singaporeans that I am meeting tell me of friends living and working overseas because they find Singapore too controlled, hierarchical and stifling. I asked the Minister about new startups in Singapore and he acknowledged the need for more of them but focussed on attracting big multinationals to bolster the economy.

Other young Singaporeans noted that there is not much of a local culture of risk-taking and failure in the country. And not much of a private venture capital structure either. So many would-be entrepreneurs leave for Australia, the US or Canada.

The sophisticated insight and knowledge shown on stage by Minister Tharman lead me to expect that the government will probably get it right as it promotes the evolution of Singapore from an efficiency-centric society to a mixed efficiency/creativity model. But it might accelerate that progress by bringing more of Singapore’s smart young Gen Y generation of creatives into policy-making positions right now. A global mega-city of Singapore’s excellence can’t afford to let any of its young go.

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