China - love it, hate it, deal with it.

Having spent seven months of 2009 in China, Singaporean Aaron Chew looks back at his time and writes a commentary from his personal experience and perspective.

CHINA, Asia's rising star, the world's awakening giant, is undoubtedly a country of immense potential. There is no doubt it will be one of the biggest players (if not the biggest) on the world stage in time to come.

Beijing and Shanghai are highly developed. Other cities like Shenzhen, Guangzhou, Nanjing are not far behind. But the vast majority of the country and population are still poor. The government is doing a great job creating jobs for the workers, who will be the labour behind the urbanisation of China. The people are brilliant (remember that us Singaporeans are the descendants of landless peasants from China) and it is no wonder that they have brilliant statesmen, economists, engineers, businessmen.

As for the uneducated people, they are highly resilient. They are able take a train for more than one day to get to another city to seek employment (I got a sleeper ticket, i.e., one with a bed, when I took the train. Some of these people get standing tickets, standing all the way!!). They are willing to work hard in harsh conditions. So it's good for the country really. These peasants make a living by becoming cheap labour and as a result, China is urbanised.

Things in China are really cheap. As an expat, I enjoyed a high standard of living without spending too much money (because I know their language and know how to bargain with them). Beijing, where I spent four months on exchange and Shanghai, where I spent more than two months on internship, are modern and so it is possible to live hygienically (whereas in a lot of the other parts of China, one may find conditions less sanitary).

On the flipside, Chinese people can be rude and abrasive. You constantly hear honking on the roads, fights are common. You need to shout for your waiters because everyone is shouting and so you cannot get their attention otherwise. All these are tolerable.

But Chinese people tend to cheat as well. When they sell you things, they tend to exaggerate and lie to extract a higher price from you. Some unsuspecting tourists may end up paying five or ten times more for their item if they don't know the right price or are inept at bargaining with them. There are also many crooks. I have actually been robbed in broad daylight before!! No passerby actually cares because fights are so commonplace in China.

I lodged a police report twice - once for the robbery, once because my friend lost his wallet. The police don't give you a copy of the police report (I tried asking for one) - isn't this very clearly room for corruption?

The Chinese government also takes a very firm hand on running the country. Stability is prized and hence, human rights are readily infringed. From arresting dissidents readily to something as small as banning youtube - it's an annoyance.

Things were calm in China when I arrived in February. But over the course of the year, a Tibetan documentary appeared on youtube, the first anniversary of the Sichuan earthquake arrived, as did the 20th anniversary of the Tiananmen Incident, and the Xinjiang riots occured!!

So one by one, youtube, blogger, twitter, facebook were blocked. There were even days that ebay, google, hotmail and MSN messenger were down because the government was so worried of the "negative influences from the West". It was so frustrating trying to keep in touch with the world outside China.

The Financial Times is a fierce critic of the country and I do not blame them. Influenced during my junior college days by eminent educators from the hippies era who marched on the streets against the Vietnam War, I made a trip down to Tiananmen Square on the the 4th of June, the 20th anniversary of the Tiananmen incident.

The whole place was eerily quiet. There were soldiers, policemen and even plainclothes policemen (who all had a badge and an umbrella each) were on patrol. I later read in the FT that protesters had been rounded up in the morning. Since I was there only in the afternoon, I had missed the action.

The rich-poor divide in China is very evident. The rich Chinese hence despise the poor. Akin to E.M. Forster's A Passage to India, the expats can generally be divided into two groups. One group mingles among the Chinese, is willing to learn more about their culture and show respect for them. Another group simply despise the Chinese, abuse them verbally, make fun of them.

It's quite sad because these Chinese are not lazy, they just did not have the opportunity back home (in the rural parts) to be educated. Hence, they seek cheap employment in the cities. Hopefully their children will get a chance to be educated and break out of the poverty cycle.

Overall, China leaves one with mixed thoughts and emotions. Sure, problems are coming. Social unrest is inevitable in a diverse land with minorities seeking independence, a severe rich-poor divide, and a government that is more concerned with form than substance and unabashedly rules with an iron fist.

But the land is undeniably rising to take its rightful place on the world stage, economically first, then politically. Ignore China at your own peril.

Swine Flu Might Be Singapore's Break

FACED with a predicted nine per cent fall in GDP, how should Singaporeans react to the news of the spread of the swine flu virus?

A nine per cent fall negates three years of three per cent growth. It also means that it is likely that one in every ten persons loses his job. In addition to that, thousands of graduates from the universities and polytechnics are due to enter the work force once semester ends, right about now. Unemployment has been on the steady rise.

According to official figures, as of March 2009, unemployment for the resident population stands at a whooping 4.8 per cent! The situation is likely to get worse in the coming quarters.

Negative growth, increased unemployment, what could be worse? So should Singaporeans react to the swine flu with disdain? This economist doubts the swine flu will affect Singapore too badly. After all, Asia as a continent has only been tainted with a few cases so far. Death and sickness should not be taken lightly and should not be used as a tool for economic growth.

Yet, economic growth could be a byproduct of the sickness. Pharmaceutical companies in Singapore will benefit (recall the Japanese firm that received a sudden order of thousands of thermometers from the Singaporean Ministry of Education when SARS hit). The government will spend money. The economic slide will slow.

Unless the swine flu situation in Singapore becomes serious enough to warrant a stopping of activity (like in Mexico or Texas), otherwise the overall economic impact of the virus on the Singaporean economy could well be a positive one.

All-too-subtle Government Messages

HAVING lived in the People's Republic of China for the past month, I have been endlessly tickled by the efforts of the central government to bring its messages across.

A statue of former Chairman Mao Zedong is on practically every university campus. In my own school, big gold words "为国家健康工作五十年", translated, "Work healthily for the country for 50 years" run across the exterior of the sports center. All university students are required to take three modules on Mao, Deng and communist leaders.

This sounds all too familiar to Singaporeans, who have been force-fed with information about the stability, ability and incorruptibility of the Singapore government from primary school, all the way to university, whereby undergraduates are required to take at least one Singapore Studies module.

In China, the straw that broke the camel's back for me came in the form of "新闻联播", or "Joint News Broadcast". For half an hour every evening, all the channels on television that would like to show news must show news from the same source, China Central Television. So regardless of what channel you flick to, the news message is the same.

The template is rather standard. The first 10 minutes would cover victories and breakthroughs in China, the second 10 minutes would be an update on Chinese communist leaders and the third 10 minutes would focus on negative stories from other countries.

The governments of China and Singapore are not the only ones who go through great lengths to ensure the right information is passed to their citizens. The Japanese governments rewrote history to make Japan a victim of the second world war. The North Korean government tells its citizens they are living in paradise.

The people of a young and immature society are easily led to believe what their leaders want them to believe. As the society matures, so do the citizens. For how long can governments keep up their all-too-subtle propaganda? It remains to be seen.

You can lie to all of the people some of the time, you can lie to some of the people all of the time, but you cannot lie to all of the people all of the time.

*The writer would like to stress that his minor disagreements with the afore-mentioned governments' methods does not change the fact that he has utmost respect for them.

Taming of the FDI-Driven Tigers

LAST July, I did a presentation at Harvard Summer School, whereby I did a comparison between the European Celtic economy of Ireland, and the Asian Tiger economy of Singapore.

Apart from their physical size, there are startling similarities between the two countries and their economies (see table below, info from 2007, source: CIA). Of particular interest to me was the fact that both economies were driven by foreign direct investment (FDI).

I lauded the foresight of the governments in attracting FDI into their countries as a viable long-term development plan that will ensure not just economic growth but sustainability too.

However, recently released GDP growth forecast figures seem to suggest that the tigers are losing their growl. A Reuters poll indicates that the Singapore economy is likely to shrink by close to 5 per cent in 2009. A European Central Bank Official predicted that the Irish economy will see a 6 per cent contraction this year.

By any standards, the figures are poor. By the roaring standards that have been set by Ireland and Singapore in the past few decades, the figures warrant a state of emergency to be declared!

Although the economies of both countries cooled in 2008, growth figures were still positive, albeit marginally. Why have the two countries been so badly hit by the financial meltdown?

In the Irish case, one reason lies in their severe housing slump. As for Singapore, it is particularly reliant on trade and hence, in a time of a worldwide slowdown, a decrease in exports is bound to hit the country.

With that said, even a housing or export slump should not have such a drastic effect on the economies. To better understand the reason behind the downturn, one needs to divert one's attention to driver behind the economic growth of the two tigers - foreign direct investment.

I advocate attracting of FDI because investment drives the economy - the demand side in the short run and the supply side in the long. In addition, there is a transfer of technology from the investor to the host country.

Because FDI is long term, a slowing of the economy should not have too drastic an effect on FDI. However, this financial meltdown has been touted as the worst downturn since the Great Depression.

We live in extraordinary times. Big companies, once supposedly infallible, are failing, owing to the folly that can be attributed to either themselves, or fellow corporate conglomerates. Governments have their hands tied up in rescuing their own economies.

Hence, this inevitably results in a fall in FDI-growth. Even if current investors stay put (which is a possibility but not so much a probability), the fall in FDI-growth means that Ireland and Singapore faces a fall in one of their key growth drivers.

My suggestion for the Irish and Singaporean government? Look inward for investment (read: a big fiscal stimulus package) to boost the economy, ride the recession out, and continue to attract foreign direct investors thereafter.

I am hearted to see that the Singaporean government has been active on that front and one can only hope that the Irish government similarly sees the wisdom of such a move, and soon.

Singaporeans, Be Proud of the Heartlands

heart⋅land   [hahrt-land, -luhnd]
–noun
1. the part of a region considered essential to the viability and survival of the whole, esp. a central land area relatively invulnerable to attack and capable of economic and political self-sufficiency.
2. any central area, as of a state, nation, or continent: a vineyard in California's heartland.

IN SINGAPORE, heartland is a term used with disdain, or even disgust. Heartlanders, a term popularized by former Prime Minister Goh Chok Tong in 1999, refers to the masses in Singapore - the less education, less refined crowd. They general live in the Housing Development Board flats. They are unlike the cosmopolites who live in condominiums and landed properties.

Yet, look up the meaning of heartland in the dictionary and you will see that it actually refers to the economic and political center of a country. If one thinks about it, it is true that the masses in Singapore form the basis of our economic and political survival. They are the lifeblood of our country. 80 per cent of our population live in HDB flats.

While it is undeniable that they are more plebeian in their words and in their actions, they should not be viewed with the contempt. They are not just an integral part of our country, they are a very important part of our country. There is certainly room for improvement in terms of their education and economic standards and the nation should continually work towards raising them.

But for now, the perspective of heartlands needs to change. Heartland should not be a derogative term, heartlanders should not be held in little regard. Respect the heartlands, be proud of the heartlanders (or in the case of 80 per cent of Singaporeans, be proud to be a heartlander).

http://www.nytimes.com/2009/01/04/opinion/04kristof.html?th&emc=th

flagrant disregard for human dignity.

Usher in 2009

The old has past, the new has come. Aaron Chew looks back on 2008 and looks forward to 2009.

AS FAR as the world is concerned, a new year as dawned upon us. As far as time is concerned, however, it is simply a continuation - from 2359h on 31 Dec 2008 to 0000h on 1 Jan 2009.

Hence, events that shook the world in 2008 will have a lasting effect on us in 2009. Here's my pick for top three.

1. Barack Obama's rise to power

It was a phenomenal victory for Obama, who is set to become the first African-American President of the United States of America. If one word was chosen to sum up Obama and all that he stands for, it would be, say it with me, "CHANGE!"

Obama is the change. He has done something unprecedented. He is a living testament of the American dream. He embodies the message that every young American can aspire big. He is proof of the power of education. His grandmother was illiterate but just two generations later, he is going to be the 44th President of the United States.

Obama has stood for change, he is the change, but the truth is, he has not changed anything. When he becomes the President in 19 days' time, he comes into office at a difficult time for the world economy. He needs to make decisive change. He needs to fulfill the promises that he made to the American voter.

His priorities should be to save jobs and grow the economy. This is a good opportunity for him to be Mr Popular, because he gets to spend more money, and do the things that help the public. Investing in education, healthcare, infrastructure.

On the international front, Obama needs to tread very carefully as he attempts to pull America out of Iraq and Afghanistan. While I fully endorse the effort, I urge caution. The insurgents must not be underestimated. Withdrawal needs to be systematically thought out and executed.

After eight years of President Bush, let's face it, the world hates America. The President-elect needs to repair the damage done. He can only do this, not by merely being the change, but effecting change. Change that will bring a better America, and a better world.

2. Worldwide Financial Crisis

The world can be summed up in four words, "People respond to incentives." In the case of the financial institutions, they responded to incentives, in a manner that is undeniably wrong. Greed got the better of the bankers, and this has finally led to the meltdown we see today.

Nothing happens overnight. The crisis is a buildup of greed over the years. It is a shame that this has happened but it is nothing more than mere human nature. Self-interest predominates.

My take on the financial crisis is that we have not seen the worst. Hence, the main street crisis has not even started yet.

My hope for 2009 is that the crisis (finally) bottoms out. I do not foresee the economy moving towards recovery until 2010. But I do hope that the worst of the financial crisis will be over.

3. Milk Powder Scandal in China

On the 8th of August 2008, the world watched with bated breath, as China went all out for their biggest PR stint ever - the Beijing Olympics. The world was blown away as China put on a spectacular show for the opening ceremony.

One of my esteemed friends, Mr Elisha Ong, was indignant as I told him, "China has a long way to go." True enough, it did not take long before the milk powder saga shook the world.

This only goes to show that there is still a great disparity between the developed world, and the developing. While the less-developed countries of the world (spearheaded by powerhouses China and India) are growing rapidly economically, they need to work harder, not just on quantity, but on quality too.

My hope for the third world in 2009 is that it continues to grow, but focus on the right things. Long term development should be the priority, not short term growth numbers. Short term growth numbers proved to be the downfall of some of the biggest Wall Street Institutions and could prove fatal for countries too.

May 2009 be a better year for everyone.

The writer wishes everyone a happy 2009!