Tend to have better understanding and knowledge of

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tend to have better understanding and knowledge of both Singapore and their original country than indigenous Singaporeans. This is an advantage in conducting international business, which requires knowledge of different partner countries (Yeoh, et al. 2012). The relation between the state and corporations in Singapore had no significant changes after 2008, thus it was not greatly affected by the 2008 financial crisis. Singapore has a special cooperative relation between the government and corporations that is called, “The Singapore Model,” which has been maintained since Singapore’s independence in 1965. The government executes their interventional mechanism while allowing a free and market-oriented economy. Besides this, corporations in Singapore traditionally tend to follow the government’s policy. After the 2008 financial crisis, the government continues to intervene with the economy by changing its monetary and macroeconomic policies to stimulate the nation’s exports, reduce unemployment, and curb inflation. Due to the traditionally good cooperation between the government and corporations, Singapore was able to weather the 2008 crisis and even had an economic growth of 14.7 percent in 2010. In conclusion, Singapore has successfully solved the puzzle of economic development. Geography, social system, and increasing return to scale are three main components of this puzzle. Singapore’s geography brings about both advantages and disadvantages for the economic performance of the country. Located at the end of the Strait of Malacca, Singapore has been a very important seaport both economically and militarily. The country has been prudently making use of this advantage for its economic development, such as the port of Singapore. The disadvantage of Singapore’s geography is its lack of land and its equatorial climate with high temperature and humidity. Acknowledging these disadvantages, Singapore has successfully built an economy heavily based on financial services and manufacturing industries, which occupies much less land than agriculture. By switching its agricultural economy to a service and industrial one, Singapore has efficiently restrained the effects of geographic disadvantage on its economy. Besides, the country has been reclaiming land, expanding its total land area from 581.5 km square in 1960s to 710.2 km square today (Chakra, 2008). The social system of most countries in Southeast Asian are reported as highly corruptive and arbitrary. Singapore is an exception; the country successfully builds a corruption-free government. Overall, it is very clear that the the state in Singapore has played a central role in many facets of the country’s development. As opposed to other centrally planned states such as China, Singapore’s centrally governed model is now being explored as a cure for executing quick turnarounds in Africa and in the Middle East.
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