Singaporean model for Jamaica?

Ian Boyne, Contributor

The country needs leadership that inspires, infuses enthusiasm and passion in people and which gives people a real sense that they are stakeholders in this society.

Singaporean model for Jamaica?

How do countries grow? What are the principal success factors? How replicable are those factors in small economies like Jamaica? What can a country like Jamaica learn from the successful modernisers?

The elusiveness of economic growth in developing countries has been of special concern to development economists. One of those who have devoted much attention to the failures of traditional economics is William Easterly, one of the most engaging economists writing today. In his books, The Elusive Quest for Growth: Economic Adventures and Misadventures in the Tropics and What Works in Development? Thinking Big and Thinking Small (co-authored with Jessica Cohen), he manifests his disquiet with the prevailing Western economic models.

The global economic crisis has only heightened interest in economic strategy and policy options. Yet there is already an abundance of economic data as to what works and what does not. Among the key issues which have emerged with intense interest in the scholarly literature is the role of institutions. The Washington Consensus advocates keep adding to the list of must-do things for development, and "strong institutions" is among the latest to make the list. And an issue being increasingly discussed in that context is that of leadership.

successful modernisers

One of the latest books to roll off the press on the matter of leadership and economic development is the Commission on Growth and Development's volume, Leadership and Growth, released in this year and edited by David Brady and Michael Spence. Chapters explore experiences from Africa, generally, as well as individual African countries like Nigeria and Rwanda, as well as Latin American countries Brazil and Asian nations such as Bangladesh. A most interesting chapter is the one of Singapore by Tan Yin Ying, Alvin Eng and Edward Robinson, Perspectives on Growth: A Political-economy framework: Lessons from the Singapore Experience.

Singapore has been one of the most successful modernisers of the 20th century, a much-admired tiger whose staggering rate of economic expansion has been among the wonders of the economic world. How did Singapore do it and what lessons can small, developing countries like Jamaica learn? Jamaica was ahead of Singapore in the early 1960s. Why such a gnawing gap between us today? What went wrong for Jamaica?

Poor institutional capacity and poor leadership, if we are to extrapolate from the Singaporean experience. According to the authors: "The successful implementation of policies depends on ... good leadership. Such leaders are visionary and diligent, selflessly devoted to national, not party/individual interests. For credibility, leaders must have integrity, be incorruptible (or have the incentives to remain so) and be honest". These are non-economic issues, but they are crucial in economic outcomes.

In Jamaica we only highlight these issues when we want to score political points and embarrass political opponents. We fail to have a serious conversation about issues of morality and development and character and leadership because the Jamaican intelligentsia tends to downplay moral and philosophical issues. There needs to be a broad discussion about the type of political and institutional leadership needed to galvanise the energies of the Jamaican people to the task of development.

The country needs leadership that inspires, infuses enthusiasm and passion in people and which gives people a real sense that they are stakeholders in this society. Singapore's Lee Kuan Yew was an authoritarian leader and certainly no model democrat, but progressives should not overlook his leadership strengths. We cannot allow his autocratic features to eclipse his example of inspiring, integrating leadership. Clearly, Lee Kuan Yew's virtues have been over-sold by right-wingers. But there are some critical lessons that progressives should not underplay. It was not just repressive tools that Lee Kuan Yew used to build the Singaporean economy. He provided inspiring leadership and infused in his people a sense of purpose and mission.

Of course, he had a cultural context - that of Confucianism - which was very supportive of that common vision and mission, quite unlike us in this materialistic-individualistic culture. Says Leadership and Growth: "Under the leadership's guidance, the population was galvanised into a resilient and hardworking people, determined to fight for their survival. They rallied to the leadership's reminder that 'the world does not owe us a living. We cannot live by the begging bowl'. Over time, the people thus developed a commitment to Singapore as an independent country in which they had a stake."

remarkable performance

Singapore has grown 4.4 per cent per year on a compounded annual basis over the past 40 years. A truly remarkable performance. Its per capita income has moved from US$4,219 in 1960 to $29,404 in 2003 - moving into the developed country status and a proud member of the rich man's club i.e. the Organisation of Economic Cooperation and Development (OECD).

Before , Singapore had a poorly-educated population, suffering from severe poverty and chronic underemployment. In terms of natural resources, Singapore is dirt poor. It's more than a cliche to say that Singapore's greatest asset is its people. It has been the management of human capital that has been responsible for Singapore's astronomical growth.

Social capital, specifically, has been high in Singapore. The left has tended to de-emphasise this and to overplay the authoritarian nature of the Singaporean leaders, and to some extent, its society. The Singaporean leadership's ability to build consensus and a common vision has been very significant factor influencing economic development.

Singapore was threatened in the early days with ethnic factionalism - which has empirically been shown to be closely correlated with underdevelopment. The authors of the chapter on Singapore point out that in contrast to the growth laggards with ethnic factionalism, growth advancers were able to engage in what they call "convergent" politics and policy-making - managing conflict and building consensus across groups and interests.

civil-war occurrence

"Notably, civil war occurred more frequently in growth underperformers as institutions and leaders failed to forge unity and instead exploited differences for their own gain." Jamaica's tribal politics, while not based on ethnicity, is equally destructive of economic growth and development.

"Countries may start with different natural endowments but institution and leadership quality will determine their growth trajectory over the longer term. The people may be divided along several lines, but consensus can be built through robust institutions and competent, incorrupt and trustworthy leaders". This is a lesson that Jamaica has to learn - and this learning best takes place outside of the shouting match and name-calling that we mistake for discourse in Jamaica.

There is another fascinating example of economic transformation from the Confucian Belt to note - China. (Yes, another authoritarian country, but it is not true that authoritarianism is a boon

to development for the fact is that there are far more authoritarian underdeveloped economies than there are authoritarian growth advancers.)

China's breathtaking economic advance is linked to its strong institutional capacity and strong social capital. Says Vladimir Popov in his paper, Is the Chinese Variety of Capitalism Really Unique? "The preconditions for the Chinese success of the last 30 years were created mostly in the preceding period of 1949-76. Without the achievements of Mao's regime, the market-type reforms of 1979, and beyond would never have produced the impressive results that they actually did.

"In this sense, economic liberalisation in 1979 and beyond was only the last straw that broke the camel's back. The other ingredients, most importantly strong institutions and human capital, had been provided by the previous regime." He points out that without those ingredients, liberalisation would be as unsuccessful as it has proved in the countries without that foundation.

building Economic growth

Economic growth has to be built on a foundation of strong social capital. When your murder and corruption rates are high, you don't have strong social capital to make an understatement. China has a murder rate of less than three per 100,000 inhabitants. It took Western Europe 300 years to move from a murder rate of 40 per 100, 000 in the 16th century to its current levels of one to two per 100,000 in the 19th century and beyond.

In China the underground economy is less than 17 per cent of Chinese Gross Domestic Product (GDP), whereas in developing countries it is typically 40 per cent, and sometimes even 60 per cent. Mao's Cultural Revolution might have been barbaric, but it did more than slaughter millions, it reinforced communalism and inculcated certain values, like respect for the rule of law and state institutions. That is lacking in Jamaica.

"Fast economic growth can materialise, in practice only, if several necessary conditions are met simultaneously," says Popov. He mentions strong state institutions and human capital. The authors of the chapter on Singapore in Leadership and Growth make the crucially important point that "sustained growth often requires trading short-term pain for long-term gain." This is Jamaica's greatest challenge, culturally.

cynical and hostile

We are not oriented toward sacrificing for the future, for we have heard too many "tighten-your-belt" pleas since the 1970s, and felt too much pain without seeing much gain. We have become cynical, even hostile to our leaders' exhortation to restraint. Besides, our North American-influenced culture rebels against postponement of gratification.

The biggest problem with any Jamaican Government's sticking with fiscal discipline, a requirement for sustainable growth, is that these policies are naturally resisted by our people. This is why we need inspiring, galvanising leadership to energise the people toward certain macroeconomic goals. The end-point of growth and development will thus be meaningful only to a people united on the purpose and destiny of their country, and who have an entrenched stake in the country. Policies that purport to bring about this end must have the consensus of the population which can then be supportive of the leadership and Government when sacrifices are called for. Social cohesion is key.

The three horizontals of development are identified as robust institutions, good leaders and people consensus. Jamaicans note this: "Count the costs ... growth and the polices that jump-start and sustain it incurs costs." In Jamaica, nobody wants to pay the costs and everyone wants to reap the benefits. It's a cultural mindset which has to change if our International Monetary Fund (IMF) programme is to work. Fiscal and monetary policies are not enough for economic growth. "The people's confidence and trust in their leaders - the first kind of people consensus - is thus relevant for sustained growth".

Ian Boyne is a veteran journalist. Feedback may be sent to ianboyne1@yahoo.com or columns@gleanerjm.com