Major events of this period	Towards Developed-Country Status Diversification and industrialisation After independence in 1965, Singapore began to move away from its post-war dependence on entrepot trade, broadly defined as the trading of goods that passes through Singapore from a foreign source to a foreign destination. It embarked on industrialisation and diversification to improve its economy and to create jobs. In the late 1960s and early 1970s, there was a rapid expansion in manufacturing and construction. There was also an increase in domestic trade and tremendous growth in sectors like public administration, defence, tourism and finance. Recession years The annual growth rate fell from the double-digit figures of 1966-1973 to 6 per cent and 4 per cent in 1974 and 1975, respectively. The slowdown in economy was in line with worldwide recession sparked off by price hikes for crude oil. The Government helped to lessen the impact of recession by undertaking land reclamation and construction activities.
Three steps to boost economy (ST, July 15, 1975)	In 1975, the Monetary Authority of Singapore (MAS) unveiled measures to boost the Singapore economy. This involved the reduction of the minimum cash reserve ratio, a cut in the MAS rediscount rate for export and pre-export bills, and the freeing of interest rates on loans and deposits of banks. The measures would also create a more competitive financial environment, while export-oriented industries would particularly benefit from cheaper funds resulting from the banks' lower prime rates and the reduction in the MAS rediscount rate. By 1976, Singapore's economy had begun to pick up again. The recovery in manufacturing was led by the electrical and electronics industry, and petroleum refinery. Export-oriented industries (like textiles and wood-based products) and domestic-oriented activities (like printing and food manufacturing) also contributed to the recovery. The emphasis had also shifted from older industries (like rubber, pepper, wood and metal products) to more rapidly-developing industries (like petroleum products, electronics, fabricated products and industrial machinery). In the late 1970s, the growing sophistication of Singapore manufacturers led to the growth of original equipment manufacturers. Skill-based but manpower-intensive electronic industries were relocated from the industrialised countries to Singapore. Another recession hit Singapore in 1985, interrupting its economic growth in the 1980s. An Economic Committee established to set new directions for the Singapore economy reviewed the reasons for the recession and recommended measures to cut costs. The major thrust of the Economic Committee's recommendations was to build up Singapore's international competitiveness, alongside longer-term issues like wage flexibility. The economic recovery came in 1986. Despite the setback of the recession, growth averaged 7.1 per cent during 1980-90 and the unemployment rate fell to a record low of 1.7 per cent in 1990. Foreign investment and Government participation Singapore was able to attract foreign investors because of its strategic location and good infrastructure. In the 1960s and 1970s, foreign investors were also given "goodies" like tax concessions, simplified immigration procedures, tariff protection and exemption from import duties. The already liberal foreign exchange controls were lifted totally in June 1978. The Government also participated directly in Singapore's economy by establishing wholly or partly owned industrial and commercial ventures. New companies were established in areas where the private sector lacked capital or expertise, like Singapore Airlines, Neptune Orient Line, Development Bank of Singapore and Sembawang Shipyard.
'Matchmaking' mission to U.S. (ST, Feb 2, 1979)	Restructuring of economy In 1979, the Economic Development Board (EDB) led a team of entrepreneurs to the United States to seek joint venture partners and new technology to speed up the pace of industrialisation in the 1980s. EDB also hoped to encourage local industries to develop their production facilities to supply multinational companies. In 1980, the manufacturing sector accounted for 28 per cent of gross domestic product, as compared to 15 per cent in 1965. Economic growth had averaged 10 per cent per year during the period 1965-80. Unemployment had declined steadily over the years to 3 per cent in 1980. To address the problems of labour shortage and to improve productivity level, the Ministry of Trade and Industry adopted a three-year wage correction policy. Singapore's economy was restructured towards higher value added activities. There was renewed emphasis on education and training, R&D, automation and computerisation.
Singapore way ahead of other NIEs: Survey (ST, Sept 7, 1994) The 8 strategic thrusts in Republic's long-term economic growth plan (ST, Oct 14, 1991) SM: S'poreans must now build up external economy (ST, Nov 16, 1992)	Newly Industrialised Economy By 1990, Singapore had emerged as a Newly Industrialised Economy. Domestically, the economy had become more matured. The economies in the region were enjoying rapid growth, providing abundant opportunities for Singapore. Strategic Economic Plan In 1991, the Strategic Economic Plan (SEP) was unveiled as an economic blueprint to guide Singapore's progress in the next 20 or 30 years. Under the plan, Singapore would be geared towards becoming a centre of high-tech manufacturing industries and an international business hub. Local companies are also advised to go regional by investing in the rapidly growing economies in the Asia Pacific. So far, Singapore's regionalisation efforts have made good progress. Singapore's direct overseas investments expanded from $7.8 billion in 1990 to $13.1 billion in 1993. It is also among the largest investors in China, Vietnam, Cambodia, Myanmar and Indonesia. Some of Singapore's regionalistion projects include: The Suzhou Industrial Park in China, Singapore's flagship project in China to be developed at a cost of US$30 billion (S$42 billion) and managed by a Singapore consortium; The Indonesia-Malaysia-Singapore Growth Triangle, established initially to cover Riau, West Sumatra, Johor and Singapore, but has since been enlarged to include the Malaysian states of Negri Sembilan, Malacca and Pahang, and the Indonesian provinces of Jambi, Bengkulu, South Sumatra, Lampung and West Kalimantan.
R&D spending up 18% to $1.2b in 1994 : NSTB survey (ST, Jan 23, 1996)	The SEP is an ongoing exercise that would be continually monitored to ensure that Singapore stays on the right track towards achieving developed-country status. Emphasis is placed on R&D and the upgrading of the workforce. In 1996, Singapore was ranked by the World Economic Forum as the most competitive economy in the world. Business Environment Risk Intelligence has rated Singapore's workforce as the best every year since 1980.
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