International Production and Industrial Transformation: The Singapore Story

Prema-chandra Athukorala and Raveen Ekanayake

Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics

Abstract: The expansion of global manufacturing value chains (GMVCs) as a major mode of economic globalization opens up opportunities for latecomer countries to industrialize and carve out niches to specialize within the value chain, instead of producing a good from start to finish within their national boundaries. However, whether this provides a pathway for self-sustained industrialization remains a debatable issue. Sceptics argue that, since multinational enterprises (MNEs), which are the ‘lead firms’ of GMVCs, dominate upper-end activities of the value chain such as product design, research and development, global marketing, and after-sales care and services, a country located lower rungs of the value chain has little room for industrial upgrading. This paper aims to contribute to this debate through an in-depth case study of industrial transformation over the past six decades in Singapore, the first country to embark on an MNE-led export-oriented industrialization strategy based on the prophetic foresight of unfolding opportunities for global economic integration within GMVCs. The findings suggest that, while Singapore had some country-specific advantages, it was hard-headed national development policy that was instrumental in transforming the country from ‘the third world to the first’ within a generation. The key general lesson from the Singaporean experience is that industrialization success within GMVCs requires embedding FDI promotion in a comprehensive national development strategy that makes the country an attractive location for international production and continuously monitoring and recalibrating the development strategy in line with evolving patterns of international production.

JEL-codes: F21 F23 O24 O53 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2024
New Economics Papers: this item is included in nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://crawford.anu.edu.au/sites/default/files/20 ... ayake_2024_04_r1.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pas:papers:2024-4

Access Statistics for this paper

More papers in Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Prema-chandra Athukorala ().