In a recent interview with former British Prime Minister Dwarkesh Patel Tony Blair He discussed the policies of Lee Kuan Yew, the father of modern Singapore, and argued that Lee made three key decisions in the early days of his administration that led to Singapore’s rapid economic development.
1. Singapore has adopted English as its national language.
2. Singapore has become much more open to foreign capital and talent.
3. Singapore had a zero-tolerance policy against corruption, and salaries for government officials were orders of magnitude higher than the public sector norm.
This got me thinking about the similarities between Singapore and Switzerland-based companies, where many companies have English as their official language, even though the country’s main ethnic groups (German 62.1%, French 22.8%, Italian 8.0%) all speak other languages. Singapore also has a complex ethnic makeup, including Chinese (75.9%), Malay (15.1%) and Indian (7.4%). Blair noted that PM Lee’s decision to force Singapore to adopt English was quite controversial at the time.
Switzerland is a highly open economy and welcomes foreign investment. Around 30% of the Swiss population is foreign-born, much higher than the typical 10% to 20% in Western Europe. Singapore also welcomes foreign talent and investment, with 37% of its population being foreign-born. Import substitution was in vogue when Singapore was founded (1965), so Lee’s policies were controversial at the time.
Like the Singaporean government, Swiss companies have a low tolerance for corruption and pay relatively high salaries to their executives. Lee’s policies on corruption and civil servant pay are highly unusual in the developing world.
Ethnic conflict is a very common problem in many parts of the world. Switzerland has adopted political decentralization to reduce the risk of conflict between regions that speak different languages. Although decentralization is not feasible in a small city-state like Singapore, Singapore has been able to reduce at least some of the salience of ethnicities by adopting English as an official language.
It is unclear whether Lee Kuan Yew had Europe’s most successful countries in mind when he adopted these policies, but whatever his motivation, he ended up creating a Singapore model that bears a striking resemblance to successful Swiss multinationals.
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