Remember discussing Singapore's fragile economy in the last blog post? And how we cannot be complacent and need to understand Singapore's position in the world in order to stay relevant to the big countries?
Well, this week, we explore the approach taken up by the government to keep Singapore relevant. And a prime example of that would be one of the Singapore-China collaboration projects, the well-known Suzhou Industrial Park.
Pause for a moment and we ask ourselves: What is an industrial park anyway? What conditions must it fulfil to classify it as an industrial park?
Well, industrial parks do not, contrary to popular belief, need to be very large. Rather, what truly makes an industrial park is the accessibility to resources and equipment. For example, access to labs, access to 24/7 electricity, access to water. Without these, a factory cannot run, and companies lose money.
Going back to Suzhou Industrial Park, we ask ourselves if we can, and/or should, continue to share our development knowledge with other countries.
To answer this question, we need to look into the events that took place when the countries began the project years ago.
In 1994, it seemed like a great idea when Singapore made a deal with China to build a giant $30 billion industrial in Suzhou. However, the project did not go as planned. 5 years into the project and the venture was heavily in debt. It turns out, local officers began a rival competition, Suzhou New District industrial park, and were using Singapore's park to get investors in and telling investors to 'come to my park, it's cheaper'. As a result, Singapore lost $90 million in just 5 years. Singapore had to sign a memorandum to transfer control from Singapore to China.
Singapore, wanting to do business with China and make money together, ended by being short-changed and undercut. This strained close ties between Singapore and China. Singapore wanted to transfer their management skills to the Chinese bureaucrats, yet failed and learnt an expensive lesson on how to conduct business with China. Why was that so?
We need to look back to the topics discussed a while ago: Cultural forces.
Just a quick refresh: The 4 leading principals in China are: Relationship, Face, Favour and Rank. While still practised in Singapore, it takes on a whole new level in China. In Singapore, it is more of 法，理，情, while in China, it's really, as a whole, the opposite: 情，理，法
Strange, how cultural forces can even affect politics and business. But that's the reality of it all. Our methods are too different, and we failed to take into account how our methods would not work the same way for another country. While we take laws as if they were set in stone, that is not the case for China, who put 'who do you know?' as the highest regard. We were unable to persuade the Suzhou officers (perhaps we did not exude our guanxi enough while doing business)(perhaps we did not make use of favours enough)(perhaps we did not try to use ranks in our favour). We failed to understand different business cultures in China, and things, therefore, turned out sour for Singapore. Suzhou Industrial Park failure further reiterates how important understanding cultures before doing something in a different environment truly is.
Therefore, I feel that Singapore should continue sharing our experiences and knowledge with other countries, but with CONDITIONS attached! Maybe charging them for using Singapore's ideas? At least that would stop incidents such as the modelling of Suzhou New District after the Suzhou Industrial Park, which was originally modelled after Singapore from happening again! Singapore can share ideas and at the same time, protect their ideas from being used against them.
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