Government-Linked Companies and State-Business Relations in Singapore
Author: Yi-jen Shih
Abstract / Chinese PDF Download
Like many East and Southeast Asia countries, Singapore has the similardevelopmental approach, especially in his strong state autonomy. But compared toother countries, the number and size of government-linked companies (GLCs, orstate-owned enterprises) are larger than any other countries in its neighborhoodregions. Singapore government highly relies on GLCs, but not local enterprises, topromote its economic growth and capital market. The development of GLCs isembedded Singapore political and economic context.
Based on the assumption that economic activities might link with specifichistorical and environmental conditions, this paper would not only analyze GLCsstructures and operations, but also discuss the political and economic reasons thatSingapore government must format lots of GLCs. Furthermore, because both GLCsand local enterprises are part of Singapore economy, we cannot discuss theinfluence of GLCs without thinking about the change of local enterprises operations.These research methods will help us illustrate the whole picture of GLCs and theirchange.
The development GLCs involve that the political elites of People’s ActionParty (PAP) how to consolidate their power, and sensitive ethnic issues. Afterindependence, Singapore government distrust Chinese and their community andlocal enterprises is not large enough to support national industrialization plans, sopolitical elites recognize that if Singapore must rely on government capacity to promote industrialization and economic growth. In the 1980’s, Singaporegovernment faced the challenges economic recession and lower support rates.Therefore, PAP elites change their attitude toward local enterprises, and they try tofoster promising local enterprise, formulate regionalization policy and many kindsof support strategies. But government strategies seems useless for local enterprisesand GLCs still be unbeatable. It is because GLCs emphasize interest-orientation,and these government enterprises have sufficient resource, information access, andgovernment endorsement. These advantages strongly increase GLCscompetitiveness and crowd many local enterprises out rising business opportunities.Furthermore, the pressure of GLCs performance enforce local enterprises to replaceChinese family business model with professionalized directorships and seniormanagers.