Lam Pin Foo

In 1998, Singapore’s impressive economic growth of the past years ended abruptly with the onslaught of the devastating Asian Financial Crisis, which started in Thailand in 1997 and quickly spread to South Korea and several other Asian countries. This was aggravated further by the subsequent dot.com bubble of the United States, which had adversely impacted both the US economy and that of other countries. The double blow pushed this tiny island republic into a recession followed by a slow growth period which lasted until 2004.

By an unwelcome coincidence, the current world financial turmoil, which originated in the US and has now spread worldwide, has, once again, hit Singapore severely. Its the worst since the Great Depression of 1929-1933. The Republic’s non oil exports have already dropped 34.8% year-on-year,  the highest on record, unemployment has risen and retrenchments of staff in its key sectors are gathering pace. For this financial year, it is expected to register a negative growth rate of between 2.5 and 5%. History has come full circle.

The current economic crisis brings into public focus the large number of  foreign employees in our midst, and the concern uppermost on the minds of a good cross section of Singaporeans is that many of them should be replaced by fellow citizens who have been retrenched and who are qualified to take over their jobs. This, in their view, would help ease the unemployment situation and reduce the impact of the recession. The Government is firmly against such an approach as this would vitiate its carefully nurtured policy of meritocracy in employment and will be detrimental to the nation’s long- term interest.

For more than a decade now, the Government and the business community have been acutely aware that, owing to Singapore’s small population and slender talent pool, it is inevitable that it will have to continue to attract the much needed foreign talent to work here in the overall interest of its expanding economy and diversified industrial base and as a way forward in an increasingly more competitive world. Consequently, both the Government and the private sector have adopted this employment policy in their respective spheres of operations as and when applicable. This has resulted in many well qualified foreign talent in various fields and levels of expertise coming here to work. Some have subsequently taken up permanent residency and even citizenship. For instance, two of the big three local banks and the national shipping line have foreign CEOs, and the huge government-linked medical and scientific research institutes have been successful in enticing world-renowned researchers to carry out their important works here. The Government has repeatedly assured its citizens that such a policy would in no way harm their job prospects and would ultimately create more jobs and enhance the national economy and competitiveness. The general consensus is that this farsighted strategy has definitely benefited Singapore and its people. Be that as it may, to those Singaporeans who have lost their jobs during a recession and are emotionally and financially affected by it, this reassurance may, understandably, be of cold comfort to them.

Steadfast in pursuing this employment policy, just recently, the government-funded Temasek Holdings, which has a massive international investment portfolio of S$185 billion, created quite a stir here and internationally by announcing that their current Singaporean CEO, Ms Ho Ching, will step down in October after close to seven years at the helm and will be succeeded by a 51 year-old American, Charles W Goodyear, who is the retired CEO of mining conglomerate BHP Billiton and who had built it up from a market capitalisation of US$12 billion to US 200 billion during his 9-year service with this company. Incidentally, in 2005, it also appointed a New Zealander to fill its No. 2 executive post.  In making the announcement, Temasek made it abundantly clear that this change in CEO was in accordance with its succession planning and Mr Goodyear was the right choice. It pointed out that although it is Singapore’s sovereign wealth fund,  it is not a government agency as it is run strictly on commercial line with full accountability to an independent board of directors. This announcement should go some way to dispel international investors’ perception that its function is to serve the national interests of Singapore Government.

Singapore is, of course, not alone in needing and wanting to attract foreign talent to its shores. China, the fast rising economic super power, which has a population of some 1.3 billion people, is also in the race for foreign talent despite its population size and vast pool of local talent. Even more economically developed countries like Britain, Canada and Australia are also trying their best to welcome foreign expertise to fill their particular needs. Above all, the United states, the world’s richest and most powerful economic and military power, would not have achieved its present preeminence but for the continuous infusion of foreign expertise and knowledge since attaining its nationhood more than two centuries ago.

So, the Singapore Government is truly carrying out what it preaches in upholding meritocracy in employment even at times of severe recession by not getting rid of the essential foreign employees in order to pacify its own displaced citizenry and public clamouring. This differs from the approaches of some countries around the world, both developed and less so, who would, in current circumstances, deem it in their national interests to retrench foreign employees first in order to safeguard the livelihood of their own citizens. While this may ease their short term problem, it would also hurt their longer term interests. As foreign talent is internationally mobile and sought after at all times, such a discriminatory employment practice would damage their international reputation and make it difficult for them to attract foreign talent to their lands in future. Will the more pragmatic and forward-thinking Singapore employment model be emulated by other countries as the preferred way forward? We shall wait and see as the global turmoil further unfolds itself.

By the way, seven years ago, I wrote a related article, “Foreign Talent – Lessons from Japan”, which was published by Singapore’s English language national daily, The Straits Times, and I would like to share it with the readers. It is posted immediately below this commentary.

Lam Pin Foo
9.3.09

Japan had started early. The Japanese were ardent admirers of the advanced Tang civilisation. Between the seventh and ninth centuries, waves of the cream of Japanese scholars, Buddhist monks and skilled personnel journeyed to China to learn more about that country. They also invited their counterparts in China and Korea to settle in Japan in order to impart knowledge and skills that they required. The Japanese capital, Nara, was modeled upon the Tang capital, Chang-An (now Xian). Chinese Buddhism held sway there. Several Chinese-style temples were built and their founding abbots were mainly Chinese.

Impact of Chinese Culture

One of them, Ganjin, made five perilous sea voyages before reaching Japan. He became the foremost monk there. Kukai, the country’s most venerated saint, studied Buddhism in China. Upon his return, he founded the Shingon sect, which is now the the largest Buddhist group there. Elite Japanese cultivated a taste for Tang poetry. Chinese poets, like Li Bai, Bai Ju Yi and Liu Zhongyuan, enjoyed cult status in Japan. Led by the emperor, their reverence became an obsession and greatly influenced the development of Japanese poetry.

Even today, it is de rigueur for discerning Japanese travellers to visit places in China made famous by successive Tang poems. Suzhou’s Han San Temple is an example. Over time, this admiration for things Chinese transformed Japan into a “sino-cised” society underpinned by Confucianism. Then the West came. When Japan was coerced into trading with the West in the mid 1850s, there was initial strong resentment. But it soon realised that the only way to achieve equality with the West was to learn from Westerners, as it did from China 1200 years earlier. Under the slogan, “Japanese soul, foreign talent”, handsomely-paid experts were recruited from Europe and the United States to teach in those fields that Westerners excelled, and to train their Japanese understudies to take over from them. They were deployed mainly in construction, transport, banking, shipping, agriculture and education,  and the medical, police, military and legal services.

By the 1870s, more than 4000 foreign experts were recruited and they cost the Japanese government a staggering 5% of its annual expenditure. However, most of them completed their contracts when the decade closed. The last batch left the country in 1899. By selecting foreign talent judiciously for each chosen subject, the Japanese quickly mastered the skills required to operate a well-trained army and navy, a police force, a railway network and shipping lines. They also revamped their educational model and legal system, switched to a parliamentary democracy and adopted a Western constitution.

Their awe for the West led them to abandon their own “backward culture” and replace it with a Western one. They also embraced other trappings of Western civilisation: Western architecture, calendar, attire, music, ballroom dancing, art and social habits. Many overzealous Japanese proposed that the nation should ditch its own religions for Christianity, and use English as the common language.

These extreme over-reactions produced a backlash from conservative elements. They took remedial measures to preserve their heritage and core values in order to put a brake on the wholesale assault by things Western. And they succeeded. No country in history has undergone such a drastic transformation and yet has been able to retain its own culture largely intact.

Japan then moved on to shock the world when it trounced China in the war of 1894. This was followed by a decisive victory over Russia in 1905. The West was convinced that this rising power had indeed caught up with it. Devastated after World War II, the Japanese phoenix rose from the ashes of defeat to astound the world with its swift economic recovery. With clever adaptation of Western technologies and expertise to meet its shortfalls, and by strengthening its own prewar industrial and scientific capabilities, it became an industrial power when the 1960s ended.

Tapping on US Expertise

When the modern productivity movement first began in the US, its guru, Dr W. Edwards Deming, was a voice in the wilderness there. The Japanese quickly saw its potential as an effective management tool and invited him to Japan to experiment with his concepts. He inspired them to perfect their productivity module, which is much emulated elsewhere, including Singapore. From the 1970s onwards, Japanese products became synonymous with quality and reliability, and took the world markets by storm. Japan became the world’s second largest economy after the US, with substantial investments and marketing networks in practically all continents.

We in Singapore are fortunate to have inherited three enduring legacies from the colonial era: an efficient civil service, the rule of law and the pervasive soft power of the English language. These are important assets to attract overseas investments. When it started to industrialise in the 1960s, the political leadership wisely courted world-renowned multi-national companies and encouraged them to establish pioneer industries here by offering them a stable government, fiscal incentives, a cheap but intelligent workforce and pro-business policies that would promote industrial peace and economic expansion. In addition, employment passes were granted liberally to foreign talent who could transfer skills and train Singaporeans to take over from them.

Foreign know-how and experts contributed significantly to higher value-added projects that sharpened Singaporean workers’ skills and raised the competitiveness of its products internationally. I am confident that Singapore will again see better times before long, because it has formulated sound strategies and forward-looking policies that would overcome the current recession.

Does Singapore really need more foreign talent in its next stage of development? Historical precedents cited above and the realities of keen global competition would lend cogent support for this approach, which has helped the Republic achieve what many regard as an economic miracle. Senior Minister Lee Kuan Yew has hit the nail on its head when he said: “If we don’t welcome them, make them stay, we will be out of this race because conditions have changed … So if we just stay in our own little pond, we will perish.”

Hopefully, like the Japanese, we, too, will also retain our Singapore soul.

[This article was first published in Singapore The Straits Times on 5 January 2002]

Lam Pin Foo