Development in Malaysia and Singapore

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asian update became the main agent for all industrial land
development in 1968. 'TWoother measures
assisted industrial growth:
. the Industrial Relations Act to promote a
Development in disciplined work force;
. the restructured Economic Development
Board (EDB) to plan economic development.
The establishment of the Development
Malaysia and Singapore Bank of Singapore in 1968 and the Monetary
Authority of Singapore in 1970 also laid the
foundations for economic progress.
R ostow's model of economic development
is frequently used to explain the process
of development. However, the model has
of the Federation of Malaysia all combinedto Industrial estates such as Jurong grew in
produce different preconditions for take-off. the 1970sand 1980sas the initial locations for
Singaporehad grown as a centre of mili- labour-intensive, multinational electronics
been criticised over the years and is increas- tary control and a port through which many firms and textile manufacturers exporting
ingly viewed as anachronistic because it was of the exports of the Malay peninsula, espe- their products worldwide. Oil revenues
devised over half a century ago to explain cially tin and rubber, were sent to Europe. It which funded the initial investments were
development at that time. This column was also a refuelling stop for shipping en expanded with the development of petro-
shows you how the model may be used and route to China. The wealth generated did as chemical processing plants by US, Japanese,
adapted to explain the growth of the much to bolster the British economy as it did and Europeanoilcompanies.A further petro-
economies of two newly industrialising coun- to establish the trading strength of Singapore. chemical complex was opened in 1984on
tries (NICs), Malaysia and Singapore. The establishment of oil trading and the Pulau Merbau.
Figure 1 shows the Rostow stage model of first refinery in 1960(beforeindependence)
economic growth which was first developed gave the city the basis for future economic Stage 3 The quest for developed status
in 1960. The model is often described as strength. It also set in train other import- The late 1980s and 1990s witnessed a
'eurocentric' because it applied to the Euro- substitution activities. further stage in Singapore'squest for devel-
pean experience over a period of several Since independence in 1965Singapore has oped status. The EDB's Manufacturing 2000
hundred years. It assumed that all countries possessed few primary economic activities Plan aimed to keep employment in manu-
followed the same pathway. Thday the start- and its economic growth has depended on facturing at 20% of the total. The main
ing point for development is very different other economic sectors. Even in 1960 the products became higher-value goods, espe-
from that experienced by European states sectors which formed the basis of growth, cially computers. Increasingly Singapore has
in the nineteenth century, as the two case not least commerce, were evident. Thgether become the focal point for new high value-
studies illustrate. with transport and communications this added products such as Seagate drives which
reflects the trading and entrep6t economy were developed in Singapore to be mass
of the state. produced elsewhere in southeast Asia. Sea-
gate employs 10,000people.
Stage 1 The colonial economy Stage 2 Post-colonlal Industrial growth Hewlett Packard researched and devel-
Because Singaporeis a small state, withjust Independence brought a change from the oped its printers in Singapore but moved pro-
over 4 million peopleliving on 647.5 km2 of laissez-faire market economy to a command duction out to China. In this way 8,500
land, it is difficult to fit its progressto the economy, with the launch of a state- employees of Hewlett Packard maintained a
classicRostowmodel. Its colonial history as controlled industrialisation programme and 1% contribution to the GDP.The shortened
a part ofthe British empire, its occupation by a series of tax concessions and other incen- product life cycles prevalent in electronics
the Japanese between 1941and 1945,and its tives. The Jurong industrial estate was estab- have enabled this pattern of manufacturing
initial post-colonial phase (1957-65) as a part lished and the Jurong Thwn Corporation to grow. However, not all companies replace
Social and political system Economic system
Durable consumer industries
Welfare capitalism?
I 5 High mass consumption
Service industries
International power?
Decreasing social equality I 4 Driveto maturity I Growth to all sectors of the
/' High investment
Social, political and institutional
change favours dynamic growth
The take-off
I Investment increases
to over 10% of gross
Beginning of one or more
manufacturing industries
/' national product
Investment is about
New social and political elite
t 2 Preconditions for take-off 5% of gross national
Export mining and cash cropping
Stagnant and static society
/' Basic subsistence agriculture
Social stratification 11 Traditionalsociety' Craft industries
Source: Rostow 1971.
Time (decades)
Figure 1 Rostow's stage model of economic growth.
. \. GeographyReview
'- .~,'I

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Singaporean production lines with higher nications and the press, and two serviced the in the world and it aims to be second by 2002.
value activities. Syquest moved a plant lCT needs of the economy. Electronics already accounted for 49% of
employing1,000 peopleto Malaysia because manufacturing production by value in 1998.
of high labour costs.…read more

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N o
0 km 500
, ,
t .....-.
4 PERAK sEMBILAN Figure3 Map showing the location of Malaysia and
6 TERENGGANU 11 JOHDR Singapore.
export, formed 14% and oil accounted for . the opening of the Malaysian Investment
4%.…read more

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The production line for Proton cars
in Malaysia.
40 km from Kuala Lumpur to the new airport
at Sepang, Labuan, the offshore investment
centre, and the proposed Bakun Dam.
Recession hits, 1997-99
One of the problems faced by geographers
dealing with the real world is that sudden
changes can affect all that one knows or
learns. The events of 1997-98 in southeast
Asia are a case in point.…read more


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