FT : Singapore Set To Roll The Dice

Wednesday, January 20, 2010

The first of two huge leisure and convention resorts based around casinos opens its doors in Singapore today, rolling the dice on a $10bn bet by Las Vegas Sands and Malaysia’s Genting group on gambling in the city state.  The resorts – officially forecast to add up to 1.7 percentage points to gross domestic product in a full year – have generated controversy because they introduce gaming for the first since time independence in 1965.  By April, however, the island state that once banned chewing gum will be home to two of Asia’s biggest casinos, competing with Macao, the world’s leading gaming centre, for wealthy Asian gamblers.  “This is an entirely new sector of the economy,” said Leong Wai Ho, an economist at Barclays Capital Research, who spent three years helping to plan the casino resorts while working for Singapore government.  Mr Leong said that the impact of the resorts would be multiplied across the economy, creating up to 40,000 jobs and boosting consumption as well-heeled tourists and business travellers flock to the city. 

The biggest of the resorts, the $5.5bn Marina Bay Sands in the city’s business district, will boast two theatres and a convention centre for 45,000 delegates as well as a casino.  A 1.2 hectare park with three swimming pools will float 220m above the pavement, spanning three 55 storey hotel towers with 2,500 rooms.  “I 101 per cent believe that this is transformational,” said Thomas Arasi, chief executive of Marina Bay Sands, a subsidiary of Las Vegas Sands.  “This is a once in a lifetime phenomenon.” …..He says he is unperturbed at the coup by RWS, which will today book the first customers into its $4.7bn hotel, in spite of having received the government go-ahead licence six months later than Sands.  Mr Arasi’s bigger development will not be receiving paying customers until April, mainly because of delays caused by the engineering challenges involved in building three 55-storey curving hotel towers and a 120,000 square metre convention centre entirely on land reclaimed from the sea…..The delay will be costly for Singapore, which commissioned the two resorts as part of a grand plan intended to transform the country’s image from nanny state to racy resort city.  The government wants to buttress manufacturing with a tourism sector earning S$30bn (US$21.5bn) in revenues by 2015 – triple today’s figure…..Most analysts and economists say they expect the resorts to be successful, with 70 to 80 per cent of revenues coming from gaming this year, falling to 50 or 60 per cent as retail, entertainment and conference facilities are phased in over the next 12 months…..Singapore has imposed a charge of S$100 a day or S$2,000 a year for residents to visit the tables as a way of calming vocal opposition to the casino developments from conservative Singaporeans who fear a spread of gambling addiction and even crime.

Genting’s development, the $4.7bn Resorts World at Sentosa, located on an offshore leisure island, will have four hotels with 1,800 rooms, a Universal Studios theme park and the world’s largest oceanarium alongside the gaming tables.  Genting, which will take its first hotel customers today expects to open its casino in time for the Chinese new year holiday in mid-February, with other attractions phased in later.  Sands, delayed by construction and engineering challenges, will open its casino and hotels in April.  Neither company would discuss revenue or profit targets, but people close to Sands say that it is hoping for net profits of between $800m and $1bn a year from next year, while the smaller Sentosa resort is thought to be expecting net earnings at about S$750m (US$539m).  Both operators have shrugged off the impact of tough rules on junketing – gambling trips organised for wealthy gamblers by independent operators – introduced recently by the government to deter money laundering.  “We’ve never expected that we would do a great deal of junket play here in Singapore,” said Mr Arasi.

References :
http://www.ft.com/cms/s/0/b986c75e-0522-11df-a85e-00144feabdc0.html
http://www.ft.com/cms/s/c349bee0-0522-11df-a85e-00144feabdc0.html

…..Faced with an ageing population and low fertility, Singapore’s government has long courted foreigners to plug gaps in the workforce.  In 1990, citizens made up 86% of Singapore’s 3m people.  Today, the share is 64% of 5m-odd.  More than one in three people are foreigners (permanent residents, known as PRs, and non-residents).  In the past, immigrants were concentrated at the top or bottom of the jobs ladder, performing work that Singaporeans could not or did not want to do.  Today, foreigners compete on almost every rung.  Some, like geneticists, bring in useful skills.  Others—it is feared—displace local skills and depress wages at the bottom.  Such fears are especially sharp during a recession.  Critics say PRs enjoy the benefits of citizenship without all the responsibilities, such as national service for men (first-generation PRs are generally exempt).  Immigrants are said to mix less with Singaporeans than they used to.  The rise in numbers means many foreign groups have reached critical mass, producing little ethnic enclaves—the government’s bête noire.  “I am Singaporean and tired of service staff who can only speak Mandarin” is a group on Facebook, the social-networking site, with more than 10,000 members.

High immigration has coincided with a widening income gap.  Singapore’s Gini coefficient, a measure of inequality, rose from 0.444 in 2000 to 0.481 in 2008—higher than in China and America.  The contrast between the glitzy downtown and the “heartlands” is glaring, and more damaging in tiny, dense Singapore than it would be in a big country, says Paulin Straughan of the National University of Singapore.  To defuse the pressure, the prime minister, Lee Hsien Loong, says Singapore will slow down the intake of migrants while accentuating the privileges of citizenship.  Meanwhile, the government has plonked S$10m ($7m) into the new National Integration Council (NIC), which will try to promote interactions between different groups.  It will not be easy, as the government admits.  “The NIC recognises that integration is a long-term effort, and may take years before success is apparent,” says Dr Vivian Balakrishnan, the head of the NIC and minister for community development, youth and sports.

But Singaporeans care less about fuzzy notions of integration than their own jobs, says Chung Wai-Keung of the Singapore Management University.  He wants employment laws rewritten to favour locals.  But this would contradict the government’s commitment to an open economy.  And the dominance of the ruling People’s Action Party means that in Singapore—unlike many countries—anti-immigrant sentiment cannot easily gain a strong political voice.  Expect no drastic policy changes.  These ripples are part of Singapore’s transformation from a micro-managed melting pot into a cosmopolitan city-state…..

Reference : http://www.economist.com/world/asia/displaystory.cfm?story_id=14859345

Protected: Dear Prime Minister

Sunday, June 14, 2009

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Sushi Etiquette

Saturday, May 23, 2009

 
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Lee Kuan Yew, who turned a malarial island into a modern financial center with a first world skyline, is peering ahead again into this city-state’s future, this time with plans to seal it off with dikes against the rising tides of global warming.  “Let’s start thinking about it now,” he said during an interview last week, in what could be the motto for a lifetime of nation building…..“If the water goes up by three, four, five meters,” he said, laughing, “what will happen to us?  Half of Singapore will disappear.”  For all his success, Lee remains on the alert for perils that may exist only on the distant horizon: the rising role of China in the region as the United States looks the other way, the buffeting of the world economy, even climate change.  Vigorous and strong-minded and on the verge of his 84th birthday, Lee talked at length about his country’s vulnerabilities, its slow movement toward a more open, worldly society and the influence of China, India and the United States in world affairs…..In his office in the former headquarters of the island’s British colonial rulers, Lee sat back in a zippered blue jacket, sipping small cups of hot water and laughing often, as different as could be from the bare-knuckled political infighter he has described himself as.  “I’ve done my bit,” said Lee, who stepped down as prime minister in 1990 and now watches over the country – and occasionally takes part in political disputes – with a seat in the cabinet and the title of minister mentor…..”To understand Singapore,” he said, “you’ve got to start off with an improbable story: It should not exist.”  It is a nation with almost no natural resources, without a common culture, a fractured mix of Chinese, Malays and Indians, relying on its wits to stay afloat and prosper.  “We have survived so far, 42 years,” he said.  “Will we survive for another 42?  It depends upon world conditions.  It doesn’t depend on us alone.”  This sense of vulnerability is Lee’s answer to all his critics, to those who say his country is too tightly controlled, that it leashes the press, suppresses free speech, curtails democracy, tramples on dissidents and stunts entrepreneurship and creativity in its citizens.  “The answer lies in our genesis,” he said.  “To survive, we have to do these things.  And although what you see today – the superstructure of a modern city – the base is a very narrow one and could easily disintegrate.”  Asked whether, looking back, he felt he might have gone too far in crushing his opponents, sometimes with ruinous lawsuits, sometimes with long jail terms, he answered, “No, I don’t think so.  I never killed them.  I never destroyed them.  Politically, they destroyed themselves.”  One of his concerns now, Lee said, is that the United States has become so preoccupied with the Middle East that it is failing to look ahead and plan in this part of the world…..As the United States focuses on the Middle East, Lee said, the Chinese are busy refining their policies and building the foundations of more cooperative long-term relationships in Asia.  “They are making strategic decisions on their relations with the region,” he said.  And this is where tiny Singapore sees itself as a model for the world’s most-populous country.  “They’ve got to be like us,” Lee said, “with a very keen sense of what is possible, and what is not.”  Every year, he said, Chinese ministers meet twice with Singaporean ministers to learn from their experience.  Fifty mayors of Chinese cities visit every three months for courses in city management.  Singapore’s secret, Lee said, is that it is “ideology free,” an unsentimental pragmatism that infuses the workings of the country as if it were in itself an ideology.  “Does it work?” Lee said.  “Let’s try it and if it does work, fine, let’s continue it.  If it doesn’t work, toss it out, try another one.”  The yardstick, he said, is, “is this necessary for survival and progress?  If it is, let’s do it.”…..

I don’t like casinos,” he said. “but the world has changed and if we don’t have an integrated resort like the ones in Las Vegas – Las Vegas Sands – we’ll lose.  “So, let’s go,” he said.  “Let’s try and still keep it safe and mafia-free and prostitution-free and money-laundering-free.  Can we do it?  I’m not sure, but we’re going to give it a good try.”  Even on social issues, themes he habitually argues with an aggressiveness that can seem inflexible, Lee sounded almost mellow.  “I think we have to go in whatever direction world conditions dictate if we are to survive and to be part of this modern world,” he said.  “If we are not connected to this modern world, we are dead.  We’ll go back to the fishing village we once were.”  For example, on the issue of homosexuality, he said, “we take an ambiguous position.  We say, O.K., leave them alone, but let’s leave the law as it is for the time being and let’s have no gay parades.”  Although gay sex remains technically illegal in Singapore, the government has indicated it will not actively enforce the law.  China, Hong Kong and Taiwan already have more liberal policies regarding gays, he noted.  “It’s a matter of time,” he said.  “But we have a part Muslim population, another part conservative older Chinese and Indians.  So, let’s go slowly.  It’s a pragmatic approach to maintain social cohesion.”  As for the set of “Asian values” of hierarchy, respect and order that Singapore is founded on, he said, “It’s already diluted and we can see it in the difference between the generations.  It’s inevitable.”  In his own family, generational values are changing.  From father to children to grandchildren, he said, command of the Chinese language had weakened, along with the culture it embodies.  “They had a basic set of traditional Confucian values,” he said of his children, two sons and a daughter.  “Not my grandchildren.”…..This well-educated younger generation is part of what Lee said was a social dichotomy in which the top 20% is as cosmopolitan as any – well educated, surfing the Internet, traveling the world without constraint.  “This is not a closed society,” he insisted…..”We built up the infrastructure,” he said. “The difficult part was getting the people to change their habits so that they behaved more like first world citizens, not like third world citizens spitting and littering all over the place.“…..Paradoxically, he said, if Singapore had not been so poor it might never have transformed itself and prospered as it has.  His warnings about vulnerability and collapse are a constant theme to persuade his people to accept limits on their freedoms…..

Reference : http://www.iht.com/articles/2007/08/29/asia/lee.php