From: dyip@lynx.dac.northeastern.edu (dawei yip)
Subject: Lee urges Singaporeans to spread their wings
Organization: Northeastern University
Date: Fri, 22 Jan 1993 00:51:43 GMT

The Financial Times, 20 January 1993


The island state is urged to recapture the entrepreneurial spirit,
writes Kieran Cooke

According to Mr Lee Kuan Yew, Singapore is the most comfortable country
in Asia.  But Singapore's former PM is not boasting - he is worried.

"That's our problem." says Mr Lee.  "Too comfortable, no one wants to go
aboard ....we have got to shake singaporeans up, make them more
adventuruous, or we will be losers."  Having outgrown its small domestic
base Singapore has no alternatives but to invest more overseas, says Mr
Lee.

When Mr Lee, now  asenior minister talks, Singapore listens. 
Singaporeans are busy discovering a world outside their republic.  A day
hardly goes by without an announcement of another overseas investment
project.

"China fever"  has gripped boardrooms.  Mr Zhu Zhen-yuan of the chinese
embassy in Singapore says Singapore's investment in China in the first
sic months of 1992 totalled S$494m against a tital of S$896m for the
entire 1979-1991 period.  "I believe Singapore's total investment
commitment in 1992 will exceed the total commitment of the past 13
years," say Mr Zhu.

Singapore's businessman are busy in Vietnam.  The island state is
Vietnam's leading trading partner with total two-way trade of more than
S$530m in the first six months of 1992.

Both China and Vietnam are tapping Singapore's expertise in
infrastructure development.  Several million singapore dollars have been
invested in hotel, shipyard and telecommunications projects in Vietnam. 
Singapore's largest state companies, which still have a big influence on
the domestic economy are linking up with the private sector as part of a
"Singapore Inc" approach to winning China projects.

The Shanghai authorities are discussing a S$430m airport project and the
formation of a special economic zone with the Singaporeans.  But it
Fujian province, further to the south, that is attracting most interest
from Singapore.  Hujian is the home of the Hokkien chinese dialect
group, the dominant group in Singapore.

Mr Oel Hong Leong, a Singapore businessman with strong links to the
Chinese community in Indoesia has taken control of more than 60 former
state-owned enterprises in Fujian.  Late ;last year two of Singapore's
biggest state companies, Singapore technologies anbd Jurong
Environmental Engineering, entered into a partnership with Mr Liem Sioe
Liong, the Chinese-Indoesian tycoon, to develop a 5,000 hectare
industrial park in Fujian.  The estimated cost if thge first phase of
the project is S$300m.

The same Singapore-Liem partnership has already successfully developed
an industrial park on Batam, an Indonesian island about 20km south of
Singapore.

To encourage greater investment overseas, the government is providing
low interest loans for various projects.  Singapore Trade Development
Board has promised to help businessmen identify overseas investment
opportunities.  Singaporean schools are being set up aboard to encourage
families to go overseas.

This more outward looking aggressive approach to business is slowly
being dopted by Singapore's cash rich banks.  traditionally viewed as
conservative stay-at-home instituitions, Singapore's four main banks -
OCBC, UOB, DBS and UOB are noe big lenders in the region and are pushing
for more international loan syndication business.

Singapore banks have now surpassed HK as Thailand's main lender.  While
HK still has the lion share of China loan business. Singapore banks are
beginning to edge into that market.  Total offshore borrowings arranged
by singapore banks rose by 30 per cent in the first half of 1992 to more
than S$4bn.

Singaoire's 2.8m people are sitting on a mountain of savings.  Savings
now stand at 47 per cent of GDP.  The country's foreign reserves are
officially reported to be nearly S$40bn but are generally believed to be
much higher.

While investments have been made in manufacturing enterprises in
Malaysia and to a lesser extent in Indonesia, the main part of
Singapore's reserves have in the past been invested in stocks, shares,
bonds and real estate.

According to Mr Lee the thrust of Singapore investment policy must
change.

Singapore must become more like South Korea, Taiwan and HK which have
internationalised and made far flung investments in manufacturing and
other projects.

But Singapore has a lot of catching up to do.  HK businessman have been
investing heavily in China for years.  The Taiwanese, despite
restrictions on doing business with China, have been quietly investing
millions of dollars.  The South Koreans are working on projects all over
the world, some under very tough conditions.

Investors in Batam, almost within sight of Singapore, say it is very
difficult to coax singaporeans to the island.  "Even when we get them
here, they want to rush back at the slightest opportunity," says a plant
manager.

Mr Lee says Singaporeans have no choice but to become more outward looking
- more willing to take risks, not so afraid of failure.

The irony, says many Singaporeans, is that Mr Lee himself is largely to
blame for fostering attitudes he now criticises.  Mr Lee's critics argue
that by building an over-regulated, carefully controlled society, with
an economy dominated bu state companies, the entrepreneur has been
squeezed out of the Singaporean.

"For years he (Lee) told us how wonderful Singapore was and how
dangerous and terrible everywhere else was in comparison," says a
Singapore trader.  "He bred a sort of xenophobia.  He can't expect
people who have grown up with thise ideas to suddenly be packing their
bags and wandering off to the outposts of China or Mongolia."

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