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What's Singapore got to do with it?

Parth Shri Tewari's picture

A daunting development challenge will confront us for the next decade: More than 1 million jobs per month – every month, for a decade or more – will need to be created to raise the living standards of the 2.6 billion who live on less than $2 per day, and the billions who will soon try to enter the paid workforce amid one of the greatest demographic surges in human history.  Job creation in the public sector is expected to be flat, at best, so most of the needed jobs will have to be created by the private sector. But how?

Singapore is one of the world's freest economies. (Photocredit: Flickr, jjcb)Focusing on the macroeconomic agenda is necessary but insufficient.  Most countries have rolled out macro-level reforms, but policymakers increasingly argue that the macro policy agenda must be complemented by targeted growth programs focusing on specific industries and value chains.  Policymakers urgently seek practical solutions to meet the job-creation challenge. 

The Competitive Industries Practice, within the World Bank Group’s Financial and Private Sector Development Network, is part of an innovative response.  Earlier efforts at industry-focused initiatives may have been controversial, but new analytical approaches – with dynamic program designs that are sensitive to market conditions and linked to achieving specific milestones with an emphasis on better governance – signal a new era in industry-level interventions.

The Competitive Industries team is taking a different approach not only to program content but also to delivery.  The team will maintain a strong presence in Washington but will be largely based in Singapore, where it will be closer to many of its clients.

Innovation is about creativity and imagination: With its aura of nonlinearity and fresh thinking, it requires the warmth of an incubator.  The hub in Singapore, launched in the autumn of 2011, is the innovation incubator for the World Bank Group.  The raison d’être of the hub is to position our resources closer to client countries so we can deliver the best of the Bank in a holistic manner, leveraging the co-location of various Bank agencies and networks in a locale with a start-up spirit.

The Bank Group’s leadership – seeking to democratize the development process and learn from all who have practical experience to share – aims to help knowledge and experience flow East to West, South to South, and South to North. The practice of development will be continually analyzed and refined by identifying what works and discarding what doesn’t.

Singapore, a city-state, has had an impressive economic journey, maximizing its geographical position and competitive advantages in unique ways. Since the late 1970s and early 1980s, Singapore has consistently adapted and grown wealthier by tailoring its economic policies to changing global conditions.

Singapore’s policies have been aimed at spurring domestic economic growth, and have also strongly encouraged the creation of an environment that is conducive to foreign investment. Such agencies as the Ministry of Finance, Economic Development Board, and International Enterprise Singapore have helped Singapore develop through pragmatic planning and an outward orientation. 

The results of its agile economic experiments and positive feedback loops are evident for all to see: Among other achievements, Singapore ranks fifth in the world in GDP per capita (at Purchasing Power Parity); second among the world’s freest economies (according to the2012 “Index of Economic Freedom” published by the Wall Street Journal and the Heritage Foundation); 14th among global exporters; and among the topmost countries in the Bank Group’s annual “Doing Business” rankings. Singapore, not surprisingly, is the most competitive city in Asia and is the third-most-competitive city in the world, after New York and London.

The value proposition of Singapore to the Competitive Industries Practice is clear:

• Proximity to several regional Competitive Industries success stories and flagship projects (in both the South Asia and East Asia Pacific regions)
• Ability to deploy experienced practitioners to support operations
• Ability to facilitate visits of clients to East Asian success stories
• Links to an infrastructure “center of excellence” and co-location with IFC, MIGA and others
• Knowledge-exchange between Singapore and other global nodes of knowledge, bringing World Bank and IFC clients in closer touch with experts and best-practice examples.

Starting in Singapore on March 5, 2012, the Competitive Industries Practice has begun to engage with client countries to help them develop their economic potential. The Practice is doing so by focusing on productive industries that have a durable comparative advantage, that can generate jobs and that can unleash inclusive growth at scale. To achieve this goal, the burgeoning Singapore team, along with its Washington-based colleagues, is supporting the Practice’s regional affiliates and Country Management Units. 

The team has already fielded a mission to the Philippines to support the country’s competitiveness agenda and to help increase the client’s capacity. Similarly, talks are underway for partnerships with Nigeria, India and Macedonia.

Through these client engagements and additional initiatives, the Competitive Industries Practice is using an industry lens to sequence and prioritize the investment of financial, political and human capital to build the foundations of competitiveness – combining efforts to improve the investment climate, infrastructure, skills, technology and access to finance. Close to its clients and on the cutting edge of development practices, the Practice looks forward to a growing global portfolio of lending and advisory services that will help its client countries meet the urgent employment challenge.