What drives the Singapore economy

In a monthly feature by SMU, Associate Dean (Faculty Research) of the SMU School of Economics Professor Hoon Hian Teck spoke of foreign investment as a significant stimulus for Singapore's economy. Prof Hoon said that Singapore needs to remain open to such investment from multinational companies in order to keep growing, noting that, “It was our [multinational companies] policy that opened the door to standard off-the-shelf technology, that raised our standards of living, created jobs, and caused wages to go up.” He also discussed how Singapore can sustain its growth and fight recessions, such as by drawing on its reserves, tinkering with its exchange rate policy, and tackling inequality. On Singapore's early commitment to open the economy to the flow of goods and services, capital and labour, he said: “I think it is important that we retain that commitment as it will give Singapore the competitive edge in creating a bright future.”