Thursday, May 28, 2009

Walking Away

Member of Parliament Sam Tan cause a minor flap recently by saying that Singaporeans are mollycoddled, and that the Singapore government should walk away to “toughen” them up. Most Singaporeans shake their head at this while almost every foreigner I’d met laughed outright. A government who want to walk away? Well, just don’t contest in a general election! That’s not hard is it?

Jokes about the stupidity of politicians aside, there is one area which I think the government should walk away from. The Singapore government should take the advice of their MP and walk away from the Singapore economy.

In Singapore, there is a state monopoly on almost every aspects of the economy. In telecommunications we have Singtel and Starhub; in banking we have DBS, UOB and OCBC; yet in all of them the Singapore government has a stake. The 2 upcoming Integrated-Resorts (IR) in Singapore are the same; the Singapore government has a stake in both of them. Some may argue that the government just has a minor stake in them, but a minor stake is still a stake.

For years all was well but as the credit crunch is hitting the world, Singapore has fared much, much worse than any country in the region. You can even argue that Singapore has fared worse than most countries in Asia with maybe only the UAE faring worse. With so much trouble besieging the Singapore economy, I got a radical suggestion.

Maybe it’s time for the Singapore government to step away from the economy and give the private sector a freer hand. For all of the government’s talk about how foreign competition is good for Singapore, the Singapore government has continued to keep a tight grip on the Singapore economy. Maybe it’s time for the Singapore government to practice what it preaches. Now I’m not saying the government should have a free for all and invite every foreign company to come to Singapore (although that’s what they have been doing for the past few years), what I’m suggesting is that the Singapore government should sell away their stake in the IRs for example, and get out of the economy. Personally I don’t see why the government should have a stake in both IRs. In fact I don’t see why they should have a stake in any IRs. They are not vital to Singapore economy, so there’s no reason to bail them out or have a stake in them.

Let the two IR duke it out on their own without government help or interference. Competition is good, but the Singapore government should be a referee, not a player. Remember when Singapore has 2 free-to-air TV station before the Singapore government intervene and decided that only one will do? We don’t need that now. Having less government interference in the economy may be better for the Singapore economy as a whole.

This is one area I think the Singapore government could and should walk away from.

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