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Critical components? Like lithium ion batteries? charging a cellphone in 10 seconds?..... http://ifile.it/94bfwp1|
Every few years someone comes up with something in some place in a country. Then it's a rush to turn the idea into reality for the whole world, and that reality into a new industrial activity for a fresh period of economic growth for the whole country. RAM, plasma, ipod, google, etc. all created raves and business volume. It's about being constantly creative in a practical way.
When it was posted that Singapore has started to focus on critical components, i thought to myself that was a good idea, like how the germans are good in making fine chemicals, small quantities of hard-to-make, valuable and therefore expensive things commanding prices you can set because they are critical to something else which is bigger. Like pharmaceuticals for health.
You can see something is a good idea when you didn't think about it before, and it appears as new, as a surprise out of the blue...and yet logical, extending from somewhere, full of potential, strategic in its function.....two opposite trends coming to one spot.
Singapore is trying to find the next niche that it can get into so that it can get ahead of everyone else. I think that's all about wanting to remain competitive. And they are doing it because they don't have a choice. Their own population is too small. So they reinvent themselves. They figured themselves less as a country, and more as an idea or business model, and once they did that, their minds became free from all the historical baggage that had consumed their neighbours even till today. Their business model for a whole country was to become the hub of southeast asia. That's why they remain quite strong as brokers of everything that moves in that region. As they accumulated wealth from being middlemen traders for their neighbors, they used their capital to build better infrastructure and ports, and also provide better social services, transforming their small island into a modern metropolis. They also used their capital to be the key factor in cross-border deals, funding trade between companies in other countries. At individual levels, they get things done; money and mouth make more money and progress.
Yet it is not enough, and i think their planners know it too. They are finding that their business model of being open to the world trade in goods and services can bring peril as much progress. Their financial services hub is being hollowed out as many expats have left. So too manufacturing using lower cost labor from neighboring countries. The question is whether this is cyclical or not. Will good times return..and when. Their main markets are the US and Europe. Both are in some straits at the moment and the general consensus is recovery only at the end of the next year at the earliest. So they will have to find new things to do, while sitting it out on their savings. Without those savings which they can use to start new projects that can create standby jobs for their locals, there will be even faster hollowing out of their economy.
Their planners would have planned for this scenario too. Which explained why they had expanded their sovereign fund investing. However, the puzzling thing is this: why were their investing arms like Temasek so slow in seeing market changes and sensitivities that they pumped even more money in companies like Merrill Lynch and Shinawatra? It is something one should bear in mind - the time between starting something and finding out it is outdated can be long. And it is long because there are too many things in the way - like bureaucracy, layers of organization for the real information and concern to go through, even turf protection based on prejudiced convention. Not only in competitive states but also in multinationals do you see this. There was one MNC which had decided to go into the dotcom business; even as that industry was sliding, it was still revving up to go in; naturally enough a lot of money was lost by the time it woke up and had to fire-sell its investments for a song. Too slow to react fast and sure to the rapid changes which accelerate in the modern world.
The next few years we will see people realizing that money should only be carefully invested after studying everything close up for themselves, and not just taking the easy way out by depending on so-called 'experts'.
Yet investment to create new products and services is something which is today the most important thing to do. Conventional wisdom says spend and consume. More far-sighted wisdom says invest for future growth. Which is correct? Probably both. But in which proportion one to the other? It will depend on the place and situation...as well as the big plan.
As for the land in which sits Melaka, she will probably muddle along as she has been doing all these years. Which is very sad because she has much potential. In fact, Malaysia has more land, resources and people to do even more strongly than her small neighbour but she has failed because she never could rid herself of the baggage of history, fear and psychologically weak perceptions in some of her people enough to invest in human capital and real incentives for all.
Progress for a country can only be made by practical-minded people who can see the future today. Playing the race card has destroyed so many opportunities which had presented themselves for that country. Her economy is now in a strange limbo - manufacturing, hollowed out; plantations, not enough value-added investments, long gestation period; mining - sure to close down in the long-term once the resources are exhausted.
But a country has to survive and grow for a thousand years. So, what will happen to the people in the meantime? Meanwhile the government continues to hold back scholarships from the brightest because it wants the others to come up while today and for the next few weeks it will get a shelling for the twenty four billion yuan equivalent it has lost trying to start a transshipment hub in one of its ports. See the impractical and skewed way things are being done? That's how a country will go downhill if not careful.
Maluijia is just known for wonton noodles, skewered meat with pineapple sauce, and oyster omelette. And the occasional family touring from Singapore, about three hours drive up.