Background Information on Singapore Demographics Singapore is a small island city-state in South East Asia with a population of about 4.5 million people. It has an area about 648 km2. It has gone from a third world country in 1965, when the country formed, to one of the world's most dynamic economies. Singapore now offers its people one of the highest standards of living in the world. Short History of Singapore Singapore was founded as a British trading colony in 1819. It joined the Malaysian Federation in 1963 but separated two years later and became independent. Upon independence in 1965, Singapore faced a lack of physical resources and a small domestic market. In response, the Singapore Government adopted a pro-business, pro-foreign investment, export-oriented economic policy combined with state-directed investments in strategic government-owned corporations. Singapore's economic strategy proved a success, producing real growth that averaged 8.0% from 1960 to 1999. The economy picked up in 1999 after the regional financial crisis, with a growth rate of 5.4%, followed by 9.9% for 2000. Summary of Singapore's Economy Singapore is a highly developed and successful free market economy which enjoys a remarkably open and corruption-free government environment, stable prices, and a per capita GDP (US$ 27,800) equal to that of the Big 4 West European countries. From 1979 to 2000, Singapore's total trade grew about seven times. Singapore's trade is roughly 2.7 times the size of its GDP. According to the Federation of World Exchanges, Singapore has a market capitalisation of over US$153 billion Singapore depends heavily on exports, particularly in electronics and manufacturing. The economy experienced a downtown turn in 2001-03 caused by the global recession, by the slump in the technology sector, and by an outbreak of Severe Acute Respiratory Syndrome in 2003, which curbed tourism and consumer spending. The government hopes to establish a new growth path that will be less vulnerable to external business cycles and will continue efforts to establish Singapore as Southeast Asia's financial and high-tech hub. Fiscal stimulus, low interest rates, a surge in exports, and internal flexibility led to vigorous growth in 2004, with real GDP rising by 8 percent, by far the economy's best performance since 2000. Singapore's economy has recovered from the lingering effects of the 2001 recession, the near-recession of 2002 and the slowdown of 2003. While Singapore's real GDP rose by only 1.4% in 2003, it increased by 8.4% in 2004 thanks to the recovery of the tourism sector, double-digit retail sales gains, rising investment rates, increased manufacturing production and the construction industry's recovery from a two-year slump, among other factors. More moderate growth (4.1%) is expected in 2005, largely due to a looming global electronics downturn and the cooling U.S. economy. Exports, particularly in electronics, chemicals, and services, are the main drivers of the economy. The government promotes high levels of savings and investment through a mandatory savings scheme and spends heavily in education and technology. Home ownership in Singapore is at 93%. Singapore A Financial Market Singapore is the fourth largest foreign exchange trading centre in the world, and a growing Asia-Pacific centre for wealth management. As a foreign exchange trading centre Singapore ranks behind only London, New York and Tokyo. Singapore is the 5th largest trader in derivatives and the 9th-largest in offshore lending. Singaporean banks have been very active in Mergers & Acquisitions with activity levels almost as great as those from the US, an economy more than 100 times the size of Singapore's. Many global companies have their regional treasury headquarters in Singapore to take advantage of the depth and liquidity of the financial markets. Many of Asia's top companies have listed on the Singapore Exchange (SGX), which is Asia-Pacific's first de-mutualised and integrated securities and derivatives exchange. The venture capital industry is well developed, with some 150 fund management companies managing nearly S$16 billion worth of venture capital funds by the middle of 2003. Key Industries These include electronics, chemicals, financial services, oil drilling equipment, petroleum refining, rubber processing and rubber products, processed food and beverages, ship repair, offshore platform construction, life sciences, pharmaceuticals & entrepot trade. (en-tre-pot - a port where merchandise can be imported and re-exported without paying import duties.) Pharmaceuticals Much of Singapore's growth in manufacturing exports has been in pharmaceuticals-whose second-quarter output was 51% higher than a year earlier. Drug-making is the latest industry to blossom in Singapore. In the past decade, Singapore has turned itself into one of the world's leading pill producers, helped by strong intellectual property laws, an educated workforce and lengthy corporate-tax breaks. Most of the world's leading drug firms make products in Singapore for global consumption. Revenues of $7 billion are expected from biomedicine this year-some 8% of its total manufacturing revenues-with ambitious plans to generate $12 billion from the sector by 2010. OIL While Singapore has no domestic oil reserves, local companies have become active in overseas exploration and production. A strategic location, sound financial system, excellent infrastructure, transparent legal system and skilled workforce have helped Singapore establish itself as one of the top three global oil trading hubs, as well as one of the top three global refining hubs. Singapore has a total crude oil refining capacity of approximately 1.3 million barrels per day (bbl/d) from its three main refineries. Singapore's strategic location at the entrance to the Strait of Malacca has helped it become one of the most important shipping centers in Asia. The Port of Singapore, the world's busiest in terms of shipping tonnage, is a key component of Singapore's prosperity and economic health. Shipping Port Singapore is the world's largest container port in terms of tonnage. Singapore retained their position as the world's busiest port, with total shipping tonnage exceeding 1 billion gross tons. More than 140,000 vessels from more than 400 lines visit Singapore annually. Changi Airport Singapore's Changi Airport has received numerous international awards and is considered to be one of the world's best airports. Changi Airport saw a total of 15.44 million passengers passing through the airport in the first six months of 2005. This represents an increase of 7.2% over the same period last year. Changi Airport is currently served by 81 airlines connecting to over 175 cities in 56 countries, with more than 3,900 weekly flights. Telecommunications Singapore is the third most wired nation in the world, and the most wired in Asia. Singapore was one of the first countries in the world to have a fully digital telephone network. Its telecommunications infrastructure includes the fully digital network, the world's first 100% ISDN availability, the world's highest urban concentration of optical fiber, one of the lowest telecommunications charges in the world, and a target date of 2005 for Optical-Fiber-To-The-Home. Safe Singapore One of the safest cities in Asia; clean and green surroundings; a shopping paradise; all manner of high-brow culture and digital-age entertainment; and food, glorious food - an unending array of culinary temptations that reflect Singapore's cosmopolitan population. Singapore's reputation as a safe haven, combined with its squeaky-clean image, lack of corruption, strict meritocracy and transparency, have made the island nation a hot spot for investors. At a time when Enron's and terror threats are on the minds of most individuals, the economic environment Singapore offers has made it a joy for those seeking to build up their investments.