T2 IH NOTES

Current economic challenges & responses (1986-1997): Challenges: - Slower economic growth Due to 1985 recession. Decline in Gross Domestic Product (GDP) growth rates from 10% in 1984 Q1 to 3% in 1985 Q1. Exports to US, a major trading partner, increased only marginally (3%), as compared to 50% and 23% in the previous 2 years. Sg dependant on external trade, US was largest trading partner, Sg suffered greater economic impact. - Resource constraints more binding & faster rising costs Sgs unit labour costs increased by 40%, which was a greater number than other countries like Taiwan (11% increase) & South Korea (1% decrease). Increase in labour costs from 40% GDP in 1980 to 46% GDP in 1984. Increased labour costs reduced Sgs attractiveness to MNCs, resulting in many MNCs relocating, and thus reduced Sgs economic competitiveness - More intense economic competition Competition from refineries in Middle East reduced Sgs role as middlemen Developing countries, especially those in SEA, were beginning to industralise, and thus competed with Sg in its traditional markets. As Sg depended a lot on entrepot trade, the threat on our role as middlemen further created economic problems. Lower labour costs in developing countries, where there was a much larger labour pool, meant that the profit-driven MNCs would opt to relocate to developing countries instead of Sg, where there was a smaller labour pool and higher labour costs. - Relatively low technology base Only 16% of Sgs population received post-secondary education, as compared to other countries like Taiwan (29%) and Japan (65%).

The lack of skilled workers, coupled with the long time needed to educate the people, reduced the effectiveness of Sgs shift to technology-intensive and later knowledge-driven industries, negatively affecting Sgs economy. Solutions: - Promotion of manufacturing and services as twin pillars of economy Incentives were offered for manufacturing investments (eg. Pioneer status) and were extended to investments in service sectors. Govt promoted technology-intensive, higher value-added manufacturing activities in fields like electronics and chemical engineering. (manufacturing) Govt promoted Sg as an Asia-Pacific centre for world-class university education and health-care services. (services) Diversified Sgs market, thus reducing dependency on a single market and helped to promote broader base for our economy and to ensure sustained economic growth. HOWEVER, Sg was still very dependent on foreign and external agencies. (limited success) - Regionalisation Investing in nearby countries (eg. China, India & Vietnam) that had abundant land, lower labour costs & new markets (what Sg lacked) Govt and Sg-based companies provided infrastructure, money & skills to build industrial parks in host countries, while land and labour were provided in return. Economic Development Board (EDB) helped local companies & MNCs to look for business opportunities overseas, and offered tax incentives for companies that set up factories overseas. Trade Development Board (TDB) also encouraged companies to venture overseas, and provided grants for new companies to move overseas. Addressed Sgs problem of limited land & labour by capitalising on potential of Asian markets, complemented links with other Western and European countries, and helped Sg to earn more profit. - Cluster development Mutually supporting industries to manufacturing (eg. electronics & engineering) were identified and developed to establish entire cluster areas. Eg. Jurong Island was a $7 billion project to merge a cluster of 7 offshore islands to form a world-class petroleum, petrochemical and chemical hub.

Further improved infrastructure in order to keep Singapore competitive and attractive as an investment location for MNCs. - Deepen technology base Govt took lead in catalysing the development of technology. 1991-1995: National Technology Plan ($2 billion project to steer development in science and technology.) 1996-2000: National Science and Technology ($4 billion project to strengthen manpower and support industry research and development (R&D) Initiatives set the foundation for knowledge-based industries to remain competitive and relevant, as well as to propel Sgs economic growth. Companies responded to govts call for greater R&D involvement (eg. Creative Technology embarked on a $186 million R&D program & ESEC Pte Ltd set up $21 million R&D centre) Sg still lacked behind advanced countries, in terms of R&D investment-to-GDP ratio (1.799%, ranked 14th in 1999, failed to meet target of 2%) - Promotion of local enterprises To diversify economy and reduce reliance on MNCs Small Enterprise Bureau (SEB) set up in 1986 to help small enterprises grow Local Industry Upgrading Program (LIUP) introduced to build up efficiency, reliability and competitiveness of local supporting industries by forging closer ties between local companies and MNCs. Percentage of local investments in Sgs economy increased from 21.5% in 1992 to 33.4% in 1998. Local investments only made up 20-30% of Sgs total investments, meaning that Sg still needed to rely on foreign MNCs.

Early and current social challenges & responses:

Population: Problems: - Population boom in 1950s and 1960s Post-war baby boom, many families started to have babies again due to the peace, prosperity and increased confidence

Sgs population grew rapidly, from 1.02 million in 1950 to 2 million in 1970. Number of children born per woman in 1960 was 5.76, an extremely high number. Caused a lack of proper housing for many people, resulting in them having to live in slums that lacked electricity, water and other basic supplies. Not enough healthcare services to meet the needs of the rapidly growing population Shortage of education services such as schools -Aged population and aging of aged population Sgs population of elderly (people 65 years or older) grown dramatically from 2.5% of the population in 1965 to 8.7% of the population in 2009. (47,200 to 330,100) Age of elderly had also increased, as the proportion of the people aged 85 years and older grew from 0.2% of population in 1980 to about 0.7% in the mid-2000s. (4,500 in 1980 to 27,800 in 2009) Increased demand for limited healthcare and welfare services, such as nursing homes and increased need for trained welfare staff. Reduction in economic competitiveness, due to a smaller number of working adults in Sg - Declining birthrate By 1980, fertility rate dropped to 1.82 children per woman, below the replacement rate of 2.1. Due to success of govts policies & increased standard of education, some women viewed career as more important than giving birth, and people married later and chose to give birth to only 1 child, or no children at all. The smaller younger population would have to take on a heavier financial burden to support the growing number of elderly, which meant that more taxes and resources had to be dedicated to the elderly, which resulted in the loss of resources that could have been dedicated to other financial sectors, reducing Sgs economic competitiveness and decreasing economic growth. A smaller working population meant a decrease in adequate talented people to support Sgs economic development, which decreased Sgs attractiveness to MNCs. Smaller labour pool, and a smaller consumer market, which compromised economic growth

A smaller number of youths meant that fewer young men were recruited into NS, which meant that Sg had a weaker defense force, which increased Sgs vulnerability to external threats. Solutions: To reduce birthrate: - 3 five-year plans implemented to reduce birthrate from 1966 to 1981 1st plan: Emphasised need for smaller families 2nd plan: Stop at two children regardless of sex 3rd plan: Maintain number of children born per woman at 2.1 children - Provision of family planning services Easily accessible family planning clinics were set up to provide family planning advice and services Contraceptives were sold at nominal prices. Abortion & sterilisation were legalised in 1970, and carried out in govt hospitals at a nominal price. Aimed at around 180,000 women who were eligible for marriage and 18-44 years old. Easily available and accessible family planning services managed to reach out to more people Out of 180,000 women targeted, around 156,000 received family planning services (limited success) - Extensive publicity on family planning Primarily through radio, television, posters & pamphlets As more people could afford radios, television sets, magazines and newspapers, the messages and importance of family planning were spread to many Singaporeans. - Incentives & disincentives Priority given to children for primary school choice whose parents were sterilised No paid maternity leave, higher hospital charges, withdrawal of income tax relief for third and subsequent child, and no priority to be given to large families for allocation of govt flats

Result: Number of children born per woman dropped from 5.76 in 1960 to 1.82 in 1980. To increase birthrate: - Promoting larger families (3 or more if you can afford it) Encouraged families to have 3 or more children if they could afford it. Income tax relief provided for 1st, 2nd, 3rd and 4th child Working subsidy provided for working mothers for each of the first 4 children attending approved childcare centres Families with 3 or more children given priority to buy a larger govt flat Medisave can be used for hospital & delivery charges for first 3 children Fertility rate grew from 1.48 in 1986 to 1.96 in 1988 Success was limited, as fertility rate dropped back to 1.83 in 1990 and continued to decrease. - Graduate Mothers Scheme -Encouraged graduate mothers to give birth, as govt believed that children of graduate parents would have smarter genes, thus contributing more to Sg - Graduate mothers could claim up to a total of $10,000 from her annual income for her first three children. Absolute failure, PAP lost much support in the 1984 General Elections (GE) and its share of votes plunged by more than 10% to 70%, its biggest fall and lowest percentage of votes since the 1963 GE. Scheme was withdrawn in 1985, as a result of much public objection and the stagnant birth rate. - Attracting foreign talent Subsidised housing costs & provided an attractive education package Relaxed Sgs immigration policy Foreigners only contributed to 0.2% of Sgs total population growth in 1980, but contributed 1% in 2000.

 In the 1980s, foreigners made up 4% of Sgs population, but to date, foreigners make up 40% of Sgs population. To tackle the aging aged population: - Senior citizens as assets to society Opportunities given to senior citizens to add value to various organizations and boost family life by contributing their skills, talent, knowledge & experience. To ensure that senior citizens remain as contributing members of society, which also helps create a positive image of senior citizens and encouraging positive attitudes towards aging. - Many Helping Hands approach Individual: Healthy lifestyle Good financial planning Ensures that the individual ages gracefully through early lifelong planning and takes personal responsibility for his/her own life

- Also helps govt save money which would otherwise be spent on social services. Family: Senior Citizens Week: Encourages elderly to stay active in family Promotes positive attitude towards ageing and aged Reminds everyone to create a socially conducive environment Grandparents Day: Brings families together to show appreciation for elderly

- Important because family can provide individuals with emotional, social & financial support. Community: Voluntary welfare organizations (VWO) Run community-based services for elderly citizens (eg. Home Nursing Foundation for Elders) Involves members of community to take care of elderlys needs Offers free health checks & organise recreational activities Help senior citizens remain physically, mentally & socially active.

- Community replaces family support by offering individuals who have no emotional or social support from families.

Government/State: Tribunal for Maintenance of Parents Parents can get help from court to seek financial assistance from children who are capable of supporting them but do not. Tax relief Taxpayers can claim income tax reduction for taking care of elderly relatives, contributing to their own or their elderly dependants Central Provident Fund (CPF) retirement accounts CPF Savings in Special Account for retirement, emergency & investment purposes Savings in Medisave Account for medical purposes Savings in Retirement Account: To withdraw savings at age 55, but must leave a minimal sum. From age 62, receive monthly sum from account. This is to force Singaporeans to save and have some money for old age.

- Govt made laws and measures to protect interests of senior citizens and to make sure their needs are taken care of, and to contribute necessary financial support needed to help individuals, families and the community to meet challenges of an aged population. Education: Problems: - Not enough govt schools available for rapidly growing population Post-war baby boom, caused population to grow rapidly (from 1.02 million in 1950 to 2 million in 1970) and hence not enough govt schools - Little or no interracial interaction between pupils, racial barriers Parents could choose the language of institution for their children, which resulted in most parents sending their children to schools which were taught in the language of their race Pupils rarely met one another Posed difficulties for nation building, as national loyalty and social cohesion are only possible when the pupils identified themselves as one people. - Serious unemployment Entrepot trade was declining and many school leavers were not able to find jobs

Solutions: - More government schools were built in a short period of time To provide a place for every child From 222 in 1963 to 267 in 1967 - Common practices were carried out to inculcate national loyalty and national pride. From 1966 onwards, pupils participated in a daily flag-raising and pledge-taking ceremony Activities, like Racial Harmony Day, were organised across schools of different language streams to bring pupils closer together. Pupils of different races got closer together, and there was harmony and understanding among the different races, thus nation building was easier. - Fostering social cohesion Textbooks were loaned to needy pupils, regardless of the pupils language streams. There was also a common examination, the Primary School Leaving Examination (PSLE), for pupils in the primary schools of the four language streams. Integrated school system: pupils and teachers of 2 or more language streams would be in the same school, under the same principal. This helped encourage interaction between pupils and teachers of different language streams. Bilingualism policy: Bilingualism was made compulsory for pupils in Secondary 1. With bilingualism, the importance of the mother tongue was recognised and it was used to impart values to the students. English was used as a link between the different races, and improved communication, breaking down language barriers. Only 40% of pupils attained the minimum competency level in 2 languages. Importance of uniform groups emphasised (eg. National Cadet Corps & National Police Cadet Corps) Opportunities for interaction and healthy competition, and also instilled national loyalty in pupils

- Streaming Introduced at primary level in 1980. To cater to different abilities and learning paces of pupils, as govt had failed to consider previously that different students had different learning needs. Gifted Education Program (GEP) introduced in 1984 to cater to brighter students. Normal (Technical) course at secondary school level introduced in 1994 for less academically-inclined students to learn at a slower pace - Teaching moral values In 1981, a new Moral Education programme for primary & secondary school students was implemented. To inculcate a common set of desirable moral values such as social responsibility & loyalty in pupils Religious Knowledge made compulsory in 1982 to reinforce values taught in moral education Housing: Problems: - Housing shortage At the end of 1959, it was estimated that about half a million people lived in slums The slums had extremely poor living conditions, as there was a lack of piped water and electricity, as well as extremely poor hygiene. Only 9% of Singporeans lived in flats built by the Singapore Improvement Trust. 150,000 units of housing were needed from 1961-1970 in order to solve the problem of housing shortage. - Lack of social cohesion Different races lived separately and did not interact with each other Hindered social interaction and cohesion - Low home ownership rates In the early 1960s, 23.2% of the population lived in flats, but more than half of this figure lived in rented flats.

Occupants did not feel a sense of belonging in Sg as they did not own their flats. - Middle income groups Thriving economy in 1970s, there was more people in the middle-income groups. As property prices had also shot up, the middle-income group could not afford private homes, but at the same time could not qualify for HDB flats. Solutions: - Launch of First Five-Year Building Programme in 1960 From 1960-1965, 54,430 units of flats were built. Many flats were built within a short period of time, and this resulted in many people once living in the slums being relocated to cleaner, more adequately supplied flats. - Bringing different races together In the 1960s, people of different races were settled together in the same housing estate/block. This hoped to bring residents together and encourage racial tolerance & understanding Phenomenon of people of the same races purposely living in the same flats, exploiting the system. there was still no social cohesion According to an oral account in Housing a Nation, people of different races still did not interact with each other, and everyone kept to themselves, and there was no sense of togetherness. - To encourage home ownership Citizens could then use their CPF to pay for their flats. Also, they could pay for their flats in monthly installments. This made it easier for Singaporeans to own flats, and have a stake in Sg. they would be encouraged to work harder to own a flat. By 1999, 86% of Sgs population lived in public flats, with 95% of these people owning their own flats. - Sense of belonging Precinct concept (group of 4-8 blocks with central space & a few basic facilities for residents) introduced to enhance sense of belonging in an area close to home Resident Committees (RCs) promoted leadership and neighbourliness in residents

Reliability:
Para 1: Source A claims that (inference) _________ I know this as Source A states that (evidence) __________ This tells me that (explanation + link) ________ Para 2: Source A is reliable/unreliable. Source B/My contextual knowledge confirms/challenges Source As claim that (same claim) _______ Source B/my contextual knowledge states that (new inference + evidence) ______ Therefore, I believe/do not believe Source A as (explanation + link) ________ Para 3: I am not so sure I can believe Source A when it claims that (inference) ________ It ignores (inference B/specific contextual knowledge) _________ Source A is a (provenance) ________, targeted at (audience) ________, and wants them to (intended outcome) ________ * Always use specific contextual knowledge, must provide specific statistics/facts.