Economic Openness and Cultural Diversity are key to Singapore’s success


As a globally connected city-state, Singapore is heavily dependent on foreign investments and talent to grow our economy and improve lives of Singaporeans. As a multicultural and multiethnic society, Singapore’s social stability depends on the close ties and relations that have been formed across different social and ethnic groups.

These two factors – economic openness and cultural diversity – are basic tenets of our success as a country and people.

Now, they have ironically been criticized for favouring the interests of foreigners over Singaporeans. Such criticisms can be found in the motion that the Progress Singapore Party’s (PSP) Leong Mun Wai had recently filed in parliament.

In their motion, the PSP took aim at Free Trade Agreements (FTAs) such as the Singapore-India Comprehensive Economic Cooperation (CECA), alleging that these agreements favoured foreign workers over Singaporean workers by allowing for the unfettered entry of foreign PMEs and their families into Singapore.

For instance, the PSP’s diagnosis on employment challenges faced by Singaporeans is simplistic blamed on foreigners, especially Indian nationals who have taken on PMET roles in industries such as finance and IT.

Their solution?  To “restore balance” in the job market, by raising qualifying salary for Employment Pass from S$4,500 to S$10,000 and S Pass from S$2,500 to S$4,500. This will add significantly to costs and hardship to all our businesses, especially the small and medium enterprises.

While such anti-foreigner narratives can be attractive to political parties that are hoping to capitalise on the anxieties of workers facing economic change and digitisation, and arguably grounded in the lived experience of some Singaporeans, it is not grounded in sensible policies.

Singapore’s unemployment rate stands at 3.7 per cent – among the lowest in the world. There has also been a large increase in the employment of local professionals, managers, executives and technicians (PMETs), with 60% of Singapore’s workforce hired in PMET roles. This too is among the highest in the world.

As Manpower Minister Tan See Leng had also pointed out in parliament, PMET unemployment remains low as PMET job vacancies and wage levels continue to rise. In the finance, infocomm and professional services sectors, EP and S Pass holders increased by 40,000, but local PMETs increased by almost 155,000.

If the data does not reflect an systemic advantage for foreigners, the only rationale that one can attribute to the PSP’s criticisms is that of xenophobia, racism and political convenience.

Certainly, racists and xenophobes exist in all societies. We should not be overly surprised if such sentiments emerge in certain quarters of our own society. The spate of racist incidents that had occurred earlier this year is testament that even in a multicultural society such as Singapore, racism continues to exist.

While racism can tear apart our social fabric and pit neighbours or friends against each other, xenophobia can result in a slow closing of borders and a gradual stifling of businesses as access to foreign markets and labour dry up.

One need only look at the wave of xenophobia that took place across Europe and America over the past decade to see how anti-foreigner sentiments can severely affect businesses and erode social trust.

By using anti-foreigner rhetoric to advance their interests, political parties and their supporters are playing a dangerous game of fire. Once xenophobia takes root, fault lines will deepen and society will fracture.

Given our dependence on the global economy and the limited size of our population, Singapore needs to remain open to global capital and talent. It is not tenable to close our doors to the world.

Without foreign investments and business, there will be far less employment opportunities for Singaporeans. Many of our local graduates have successfully landed jobs in global tech giants such as Google and Facebook.  Our SMEs have also benefitted from the strong presence of MNCs setting up their operations in Singapore, bringing them more business contracts and collaboration opportunities.

Furthermore, as Finance Minister Lawrence Wong has pointed out:

“Singaporeans are great in the workforce but there are just not enough of us.”

In order for these companies to thrive and continue providing jobs for Singaporeans, there is a need to ensure  that firms continue to enjoy good access to skilled workers, both local and foreign.

In the highly globalised economy of today, countries that succeed will be those that are able to take on a global mindset and turn diversity into a strength. This will require being comfortable in the plethora of cultures and accents that the world offers and being capable of competing at the global level. This means rejecting a ‘me versus them’ mindset and embracing instead the skills and global networks necessary for succeeding in the new economy.  It also means providing social safety nets to help those who are affected by the downsides of globalisation, so that we leave no one behind.  

These challenges are not unique to Singapore, they are confronting many societies around the world.  With the foundations that the PAP government has built up over the years with our people, including our strong public trust, social compact and tripartite partnership, Singapore is better placed than most other countries to find a way forward for our society to stay together while we continue to move ahead.

Cover photo credit: PSA Facebook page