Analyze Globalization's Impact on Singapore's Development.

Topics: International trade, Economics, Human Development Index Pages: 5 (1732 words) Published: September 4, 2010
“A developed country is one that allows all its citizens to enjoy a free and healthy life in a safe environment.” These are the wise words of Kofi Annan, former Secretary-General of the United Nations. Thus, there are a set of tangible criteria to help determine the development of a country, of which economic criteria tend to dominate, with indicators such as the Gross Domestic Product (GDP) as well as other social and security needs of the people, with the recent Human Development Index (HDI) which measures overall well-being of the people. So, with the recent phenomenon of globalization becoming ever more widespread in our society today, there is no doubt that it has impacts, both positive and negative, on the development of Singapore as a country these past few years. Globalization, broadly speaking, refers to the integration of economies and societies through cross country flows of information, ideas, technologies, goods, services, capital, finance and people resulting in greater interdependence. Thus, the essence of globalisation is connectivity. To some, globalisation serves as a blessing for the development of Singapore as it represents a brave new world with no boundaries; for others, globalisation spells doom and destruction for Singapore’s progress.

Firstly, globalization has enabled Singapore to have high economic growth and a stable economy for more than fifty years. From our humble beginning as a small fishing village, economic globalization has played a key role into transforming Singapore into the busy metropolitan city it is today. One move by the Singapore government during the early beginnings of the country was to allow free trade in Singapore, especially when the port was located in such a strategic location of the Straits of Malacca. In Singapore, there are no import tariffs imposed upon trade and this has enabled collective benefit both for us and for other countries. The liberalization of trade has opened Singapore up full-fledged, to globalization, and this has allowed Singapore to reap the benefits as well. When no tariffs are imposed on goods from other countries, it means lower prices for consumers. According the Law of Demand, when the price of goods fall, there is increased demand for those goods. When demands increase from abroad, industries will respond to the demands by reducing costs and increasing efficiency. Even though reducing production costs will lead to a reduction in the supply of the product as the industries earn less from that product and make less of it, however, overall, there is increased productivity and greater trade brought about. Since trade is a form of globalization through global exchanges, thus an increase in trade will lead to increased globalization, which will bring about greater economic growth for the country. Evidently, globalization has brought about many benefits to Singapore’s development as such. Our economy has grown 125 times from $2 billion 50 years ago to $250 billion today, and credits go to free trade for bringing about an expansion in such exchanges, which boosted our economy. Also, our trade-oriented growth strategy has yielded relatively high GDP growth, and our current GDP of 0.944 is indicative of our well-developed economics sector.

Moreover, the signing of free trade agreements is a form of opening up to positive globalization. The rapid pace of globalization is confirmed by statistics for international trade and investment. In parallel with this move towards globalization, Free Trade Agreements (FTAs) has enabled greater economic development for many countries, Singapore notwithstanding. It has enabled trade creation among countries bound by the agreement and thus has resulted in the expansion of markets of countries. For example, the signing of the ASEAN Free Trade Agreement has created a larger regional market and integrated economies of ASEAN countries. Also, with increased globalization, there is also increased flow of investment....
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