Looking East: Innovation and Business in Singapore

busqueda de socios para empresas
Vivian Hendrikse
 
Of the 20 best global innovations of the year 2017, 3 initiatives originated from Singapore [6]. According to the Bloomberg Innovation Index, Singapore is ranked 3rd globally when it comes to innovation [7]. Next to that, Singapore is ranked as the number one smart city according to ABI’s and Juniper’s researches in 2018 [7]. If that is not enough, the world bank names Singapore as the “easiest place in the world to do business”, and Singapore was the main subject of a Michael Porter Harvard Business Innovation case study [3]. If there is one thing that these facts bear in common, it is their message that Singapore, as a city and country in one, is a successful hub for doing innovative business. What is the cause that led Singapore to be this successful when it comes to innovations?

Singapore’s “Home” strategy

 
According to Damian Chan, international director at the Singapore Economic Development Board – the leading governmental agency that decides on the nation’s strategy for innovation – the “success” of Singapore is not caused by just one factor, rather it is driven by a general “welcoming approach to business” as a basis for everything that Singapore does [3]. Singapore was formed a little more than 50 years ago, when it became independent from Malaysia. At the start of being a new nation, the Economic Development Board (EDB) was formed in order to create new jobs, attract international companies and enhance the development of export-oriented industries to lead Singapore, as small as it was and with the few resources it had, towards becoming an independent nation. In this process, the focus of the EDB slowly started to include a focus on innovation, motivated by the need to stay ahead of global competition [7]. The result: Singapore’s “Home” strategy: “Home for Business. Home for Innovation. Home for Talent” [3].

The attractiveness of doing business in Singapore

 
When it comes to attractiveness for businesses, Singapore already has the advantage of its unique characteristics: being a small, Western and developed country in Asia. These characteristics matter: new regulations can quickly be set and applied in a small country and offer, in combination with business efficiency and knowledge, a fast-growing, future-minded business environment [8]. What is more, Singapore is often seen as the gateway for the Western world to Southeast Asia, a region where resources are ample yet corruption reigns. Singapore is the rare exception of a non-corrupt nation in the region. Add English as the country’s official language to that and it quickly becomes clear that Singapore is an attractive investment for businesses that want to reach out to Southeast Asia [8].

Source: NCC Group [9]

The “Home” strategy applied

 
However favourable these business conditions of Singapore are, they would not sustain if the EDB had not recognised them and created the “Home” strategy. The strategy enables these conditions to further develop and even strengthen, placing Singapore far above other Southeast Asian countries when it comes to foreign investments [7]. The “Home” strategy is applied to all sectors related to innovation and business, for example the start-up scene, (digital) technologies, and education. This entails that Singapore is investing enormous budgets in these sectors, for the development of both enabling regulations as well as a stimulating environment. By creating laws that are favourable and even financially incentivising for start-ups or technology related firms, and developing multiple incubators, hubs, and open workspaces across the city, Singapore successfully pushes for innovation. Moreover, Singapore keeps investing in these sectors, even when results have already been seen: the nation recently created a new innovation fund of 1 billion Singaporean Dollars to drive enterprise growth [2]. The results are astonishing: Singapore doubled its number of start-ups from 22,000 in 2003 to 43,000 in 2016, and in the same time-span, the number of tech start-ups also roughly doubled (from 2,800 to 4,300) [1]. Next to that, it obtained the reputation of the number one smart city, a highly ranked innovation hub and the go-to place for start-ups, as mentioned in the introduction. All in all, it indeed seems as if the “Home” strategy works. Therefore, when it comes to innovation and business, it is of importance to keep Singapore high on the radar.
 

Sources:

[1] Enterprise Singapore (link)
[2] Rumi Hardasmalani (April 26, 2017), New S$1 billion Innovation Fund to Drive Enterprise Growth, TODAYonline. Available Online (link) [Last Accessed: 04.09.2018]
[3] Dominic Basulto (May 26, 2015), The Secrets to Singapore’s Track Record of Innovation Excellence, The Washington Post. Available Online (link) [Last Accessed: 06.09.2018]
[4] Monetary Authority of Singapore (link)
[5] Economic Development Board: Industries and Key Activities (link)
[6] Ministry of Finance: Innovation Initiatives (link)
[7] Economic Development Board: Innovation (link)
[8] Singapore Expats: A Brief History of Singapore (link)
[9] NCC Group: Infographic Facts about Singapore (link)