These ideas emphasise that private enterprise must increasingly lead growth, and that to continue to thrive, we must be willing to venture into the unknown, explore new ideas, and establish new enterprises. To succeed, the initiative must come from individuals rather than the state. The government's role is to facilitate the creation of wealth and to enable individuals to do well. It is not to provide handouts or excessive social safety nets. 4  BIS Review 19/2003  Many Singaporeans, particularly the workers, feel instinctively that the ERC changes are far-reaching, and worry that we are moving too fast. On the other hand, some analysts and journalists have faulted the ERC recommendations for not being bold enough. I hope that setting the changes within this larger philosophical context will help to bring out their true significance. Much more so than the two previous paradigm shifts of the 1960s and 1985, the current one calls for a mindset change - on the part of everyone. That is the fundamental remaking that we are striving for. Singapore is by no means alone in facing the challenges of a fundamentally altered landscape. The other NIEs also face similar environmental changes, and are also searching for new strategies and policies. South Korea has been revamping its chaebol-centred industrial system and has also opened up its economy to foreign investment and competition. Taiwan is confronting the hollowing out of its manufacturing industries to mainland China, while Hong Kong is adjusting to the deflationary consequences of its currency peg system.

And changing the economic model would mean radically altering the social and political framework as well. This time, the national consensus for reform, and the will to change, has proved elusive. But given Japan's past ability to remake itself, it would be hasty to conclude that it will not do so again. China China offers an interesting contrast to Japan's experience of modernisation. In the 18th century, at the zenith of the Qing Dynasty, Emperor Qian Long promulgated a "closed door policy" to restrict foreign trade to the single port of Canton, cutting China off from Western technology and influence. In 1793, Britain sent Lord George Macartney on a diplomatic mission to request for broader trading opportunities and diplomatic representation in Beijing. The request was refused. The Emperor declared in his reply to King George III that China "possesses all things in prolific abundance and lacks no products within its own borders". The shiploads of manufactured products from the ongoing Industrial Revolution in Britain failed to alert China to the technological progress beyond its shore. Within 50 years, China's weakness and backwardness became painfully obvious. China was forced open by the western powers, and compelled to sign unequal treaties with them. Amidst internal unrest and foreign invasions, the Qing dynasty made repeated attempts to reform and modernise itself, but all these efforts failed. China was in political disarray, and the turmoil continued into the 20th century. Under the Communists, China established a centrally planned economy, rejected free markets and the profit motive, and emphasised egalitarianism.