Singapore as a model of an emerging economy of well-being
Author of An Economy of Well-being: Common Sense Tools for Building Genuine Wealth and Happiness
April 18, 2018
My first trip to Singapore was one of the most memorable in many years. Singapore surprised me and blessed me in ways I am still trying to process. I had been to China many times as well as the Philippines, Hong Kong and New Zealand but what I experienced in Singapore has filled me with hope for the future of our world.
I was invited by the Graduate Biblical School of Theology, sponsored by the generous Far East Organization, to present my new economic ideas from my new book An Economy of Well-being: Common Sense Tools for Building Genuine Wealth and Happiness.
What I experienced in my week in Singapore is a kind of blessing and hope for the future that was unexpected. I wanted to share some of my reflections with many of my new Singapore friends to encourage you and your remarkable country to stay the course of your past 50 years and chart a new course for what I believe will be an economy of well-being.
From the moment I arrived at the Singapore airport on April 4, 2018 I was treated with hospitality that I have never before experienced. From the limousine driver, the staff at the Oasia Novena hotel owned by the Far East Organization (FEO), my first coffee meeting with Georgie Lee, to my wonderful hosts from FEO and BGST, to meeting remarkable individuals like Dr. Wei Leong Gho, Prof. Ho Peng Kee, Su Tay, Lynette Leong and many others whose lives and testimonies leave me hopeful for our future.
Dr. Seng Kong Tan (to the right of Mark Anielski in the photo), professor of Systematic and Spiritual Theology, was my host having curated my trip for the past 12 months. I can thank my good friend Eirene Wee, a Singaporean missionary living in Toronto who more than 5 years ago reached out to me as she was completing her masters at Regent College in Vancouver,Canada on the subject of ‘Boss Christian Conversion.’ She reminded me that my first book, The Economics of Happiness: Building Genuine Wealth was an important book for Singapore, a kind of ‘kingdom economics.’ It is because of her prayer and her devotion to being guided by God’s grace that I would visit Singapore.
So, what have I learned and why am I so hopeful for the world’s future which currently seems to dark and depressing?
Over coffee with Georgie Lee, a mentor to Philip Ng CEO of FEO, I learned about the history of Singapore from its earliest days having been rejected by its parent nation, Malaysia for wanted to embrace the diversity of faiths and religions and chart a new economic course based on principles and values that included honor, integrity, trust and reputation for a great place to do business and raise healthy families.
What I knew about Singapore from what I had heard in Canada was that it is a country of rules and where meritocracy is held in high esteem.
What I learned and came to see with my own experience is that the strength of Singapore has indeed been the adoption of some of the best in Judeo-Christian values perhaps drawn from the British rules of laws and governance. These values include a unique form of love of neighbour. That is not to say that Singapore is a Christian nation. Not at all; Singapore is comprised of an equal blend of Buddhist, Christians, Muslims, Taoist, Hindus and many who have no religion.
Indeed, it is a nation of diversity of religions and values just like my home country of Canada. It is this respect of differences and an embrace of multiple cultures that gives Canada and Singapore a unique form of social and cultural capital. It is these core values that makes Canada and Singapore the most trusted and respected amongst nations to do business, raise families and live a good life free of violence, fear, corruption, and war.
I came to see the important cultural advantage Singapore has over other nations in which honor, integrity, rejection of corruption and even love are experienced at all levels in society.
This small island nation of 5.6 million people in one of the most densely populated nations in the world, second only to Macau and Monaco. Yet Singapore had the world’s 3rd highest level of life expectancy averaging 83.1 years for men and women, following Japan and Switzerland, ranked first and second.
It seems that the more densely populated nations also enjoy longer lives which supports evidence from positive psychology that relationships matter the most to our happiness and well-being over money and levels of education. We are relational beings, hard-wired to connect. Singapore is also likely a good model for tolerance for differences and social cohesion.
In terms of the happiness or life satisfaction of Singaporeans, the World Happiness poll ranked Singapore 34th among nations, the highest in Asia but below Finland, Norway, Denmark and Canada that consistently rank amongst the top 10.
But are Singaporeans really less happy than these colder climate countries?
When looking through another set of indicators from the Legatum Institute’s Prosperity Index data base, I found Singapore outranks most other countries. For example:
• Life expectancy averages 83.1 years ranked 3rd in the world (2015).
• 83.6% of Singaporeans say they are well rested ranked 4th in the world.
• 95.8% feel satisfied with their personal health, ranked 1st in the world.
• Only 5.3% feel they have serious health issues, ranked 1st in the world.
• Suicide rates are very low at 8.6 per 100,000 population ranked 118th in the world.
• Tolerance for ethnic minorities is at 84% ranked 15th in the world.
Yet there is room for improvement including:
• The level of worrying (a lot) is low at 28.4% ranked 35th in the world.
• Trust of others is ranked 60th in the world, suggesting room for improvement.
• Singapore’s Gini Coefficient — a measure of income inequality — is quite high ranked 37th highest (compared with Canada ranked 117th and Finland 156th, the country with the least amount of income inequality. Singapore’s high levels of inequality may be due to the fact that nearly 1.0 million migrant workers earning lower wages make up 20% of Singapore’s population.
Singapore like many other nations is experiencing a rising level of household income inequality measured by the Gini coefficient; according to the Department of Statistics in Singapore, the Gini coefficient for household income (before government transfers rose) increased by 9.0% between 2000 and 2007 then fell again by 4.77% since 2008.
Singapore also has remarkable financial assets with over US$475 billion saved in its two sovereign wealth funds (GIC and Temasek) second only to Norway’s $1 trillion sovereign petroleum wealth fund. Singapore has achieved this remarkable achievement with virtually no natural capital assets. This sovereign wealth fund should provide future Singaporeans with an important financial asset base to ensure economic resilience for many years to come.
With an estimated GDP of US $316 billion in 2018 or US$ 56,584 per capita Singapore ranks 10th in the world in per capita GDP. The World Bank estimates the total wealth of Singapore at roughly US$1.306 trillion in 2005 or just over US$300,000 per capita which suggests that Singapore’s economic return on total assets or wealth of roughly 9.75% which is higher than the US at 6.0% GDP as a percentage of total wealth. Over 54% of Singapore’s total wealth are intangible assets (people, social capital and other residual assets) and 27% are produced capital or physical assets like buildings, machinery, road, housing and other infrastructure.
While Singapore enjoys remarkable financial wealth, many younger Singaporeans (Millennials) I spoke with worry about their financial future suggesting there may be a growing financial anxiety about the future sufficiency of income to meet rising costs of living.
Median monthly household income in 2017 was S$7,850 or S$94,200 (US$70,524 per household) per annum. In contrast, the median Singaporean household expenditures averaged S$56,384 (US$42,213) based on a 2012/13 household expenditure survey. This seems to suggest that even if inflating expenditures to 2017 S$ that the average Singaporean household seems to enjoy a relatively healthy level of disposable income (excluding the impact of taxes).
Yet, Singapore by international comparisons is an expensive place to live. According to a cost of living international comparison website (expatisan.com) Singapore ranks as the 19th most expensive country (out of 336) to live and the second most expensive in Asia (out of 36). Hong Kong is on average 10% more expensive to live. Singapore is the world’s most expensive country to own and drive a car. Unlike in Canada, just to have a license to drive on Singapore roads can cost S$5,000 per year plus insurance and the annual depreciation cost of the vehicle. For many young couples owning a vehicle is likely unaffordable. While the majority of housing is in public housing, the average rental rate for an 85 m2 (900 sq.ft) apartment is roughly US$2,000 per month. According to Statistics Singapore, 87% of Singaporeans owned their own home in 2010 down from 92% in 2000. Only 47% of migrant or non-Singaporeans households owned their own homes in 2010 down from 78% in 2000.
How much money is sufficient for a level of happiness? Some economists who have studied the relationship between household income and levels of happiness have suggested that US$75,000 per household is the level of median income that secures a relatively happy life (based on happiness self-ratings relative to income). The median household income in the US is only US$56,516 in 2015 or only 80% of Singapore’s median income. I’ve estimated in the US that 63% of all US households are living below what might be considered the ‘happiness household income’ threshold of $75,000.
What would a happiness household income threshold be in Singapore? That is ultimately determined by Singaporeans themselves relative to their material and life expectations.
From what I experienced in my week in Singapore, I witnessed one of the cleanest, most comfortable, wealthiest, efficient, most organized, hardworking and relatively happy society I have ever encountered, including Canada.
It seems that the first 50 years of Singapore’s progress, since it become a republic in 1965 under the leadership of Prime Minister Lee Kuan Yew, have been successful by most measures of conventional progress. But what about the next 50 years or the second Jubilee period?
Can Singapore maintain its comparative advantage in Asia and the rest of the world? Will it’s success in investment in human and cultural capital assets and its healthy supply of financial and built assets be enough to ensure its flourishing for many more generations?
Can Singapore maintain its unique core values that the rest of the world, especially China and other Asian nations, have come to respect and the reason to they trust doing business in Singapore?
Can Singapore maintain its brand? According to the Edelman Trust Index for Nations, Singapore ranked 4th overall in the Nation Trust Index — a measure of the level of trust of citizens of its nation. This compares with Canada’s 10th overall ranking.
According to the Reputation Institute, Singapore ranked 20th overall in 2017 in the Reputation Index of nations while Canada ranked #1 followed by Switzerland and Sweden. India ranked 33rd, the US ranked 38th and China 47th in the world in reputation.
What about companies like the Far East Company led by Philip Ng as models of companies that espouse values such as integrity and love? Can these become models for the rest of Asia and the world that flourish because of a commitment to strong values that result in performance beyond monetary profits?
How can a corporate culture like FEO’s which defines its core business values as ‘grace, unity, integrity, and diligence’ compete in a world that seems singularly focused on maximizing profits and GDP?
As a former professor of corporate ethics and entrepreneurship I applaud the courage of Philip Ng and FEO as a firm who defines love in the following manner:
“Love is a commitment that also encompasses loyalty.
Love is concerned with securing the well-being and welfare of others.
An organization that has love as its value is one that genuinely cares for the people it interacts with.
For those who experience this value, many respond positively, and some are even motivated to emulate.”
How remarkable that the core value of this company incorporates well-being into its DNA.
We could do no worse than establish love as the cornerstone value of companies and communities everywhere in the world.
Mr. Ng goes on to state unequivocally, ‘Love, with Diligence, is seen in deeds. Integrity must involve the pursuit of truth, excellence and honesty in our dealings with others. Unity of spirit yields organizational excellence and aligns all to do Business with Grace.’
Singapore may well be the world’s most important experiment in building a new flourishing economy of well-being led by corporations like FEO that live according to values that most would find honorable and the conditions for doing business in an integral and trustworthy fashion. Moreover, such businesses will certainly become models for other corporations to adopt a well-being-based approach to doing business and a well-being culture in which employees and their families flourish.
It is important that the next generation of Singaporeans revisit and re-examine the past 50 years to ensure that these values are verifiably the basis of Singapore’s continued prosperity and resilience. That Singapore remains a beacon of hope for a resilient Asia and a flourishing world economy.
If I were to offer advice it would be that Singapore adopt a total asset management system that measures and continually seeks to improve the well-being conditions (the English definition of the word ‘wealth’) of it’s human, social, natural, built and financial assets. Governing from the basis of a proper balance sheet of the assets of the nation and strategic assets like FEO will ensure long-term resilience. Linking Singapore’s sovereign wealth funds and its monetary policies to the well-being conditions of the nation would distinguish Singapore from other nations who now struggle with mountains of unrepayable financial debts that threaten financial armageddon.
Singapore’s former Prime Minister Lee Kuan Yew once remarked that Singapore must remain economic agile and continuously innovative as it navigates uncertain economic waters ahead. Economic growth and profits are important, but this must be balanced with ensuring that Singaporeans are healthy, happy and flourishing. This will require keeping score more comprehensively than conventional measures of economic success to include a broader suite of well-being indicators.
After all concern for the well-being of others is our highest calling; the foundation of what Philip Ng calls love.