Mr Philip Yeo, whose name is practically a synonym for the Economic Development Board that he led for decades, delivered his first lecture in this series on March 6, 2025. “Charting Singapore’s Economic Transformation” is the title of the first of three lectures by Mr Yeo, whose curriculum vitae also included the chairmanship of the Agency for Science, Technology and Research (A*STAR), and SPRING Singapore (now Enterprise Singapore), among a host of heavyweight posts.

Currently, Mr Yeo chairs Economic Development Innovations Singapore (EDIS), Advanced MedTech Holdings, Accuron Technologies and i-Globe Partners.

In his opener, Mr Yeo provided an overview of Singapore’s industrial and economic evolution, offering candid insights into economic policymaking and the challenges ahead.

Singapore’s Economic Evolution: Key Phases and Strategic Choices

He traced the country’s transformation from the labour-intensive manufacturing base of the 1970s to today’s diversified, high-tech economy, highlighting three key phases:

• • 1970s–1980s: Industrialisation and Employment Creation – The British withdrawal of forces spurred the birth of a defence industry that was crucial to job creation. The EDB focused on attracting multinational corporations to develop the manufacturing sector.
  • 1990s–2000s: Transition to High-Value Industries– Singapore moved from low-cost manufacturing to high-value sectors such as electronics, semiconductors, pharmaceuticals, and petrochemicals. Mr Yeo reflected on his role in founding Chartered Semiconductor Manufacturing in 1987, in parallel with Taiwan’s TSMC, and the strategic decision to cluster industries for efficiency. He highlighted the creation of Jurong Island, which consolidated several small offshore islands into one, to create a world-class petrochemical hub. The government invested heavily in infrastructure to support the industry, ensuring that Singapore could move beyond oil refining into higher-value chemical production.
  • Present and Future: Knowledge-Intensive Growth With costs rising and a domestic workforce shrinking, Mr Yeo emphasised the importance of advanced manufacturing, artificial intelligence (AI), and biotechnology to sustain economic competitiveness.

Where Singapore is Today

Manufacturing remains critical to the country’s economic independence, as a service-driven economy alone cannot sustain long-term resilience. “If I tried to sell services to our neighbours, they would never buy,” he remarked, highlighting the necessity of high-value exports.

Future Challenges and Opportunities

Technological disruption, geopolitical shifts, and demographic trends will shape Singapore’s economic trajectory, he said, noting that automation and AI will transform industries, reducing reliance on labour but increasing demand for specialised talent.

He also addressed geopolitical uncertainty, particularly in the face of US-China tensions and shifting trade policies. Singapore, he emphasised, must maintain its strategic neutrality while leveraging its strengths as a global connector. Furthermore, he highlighted the challenge of sustaining economic growth facing the reality of an ageing population, stressing the need to continuously upgrade the workforce and keep industry innovating.

Highlights: Key Takeaways from the Discussion

Mr Yeo kept his lecture short and crisp to devote more time to answering questions that further pursued the economic challenges facing Singapore and future opportunities. It was moderated by Mr Chng Kai Fong, Permanent Secretary (Information and Development) with the Ministry of Digital Development and Information.

Singapore’s Competitive Edge in Manufacturing

Mr Yeo argued that despite high costs, Singapore can sustain its manufacturing sector through automation, high-value production, and talent development. But the shortage of labour poses a challenge. “We don’t have enough quality engineers,” he stated, advocating for aggressive talent attraction strategies — he cheekily termed this as “kidnapping” — by dint of offering scholarships to students from Asean countries.

The Role of Semiconductors and AI in Singapore’s Future

Touching on the critical role that the semiconductor industry plays in Singapore’s economy, Mr Yeo noted that while the US and China are competing intensely in the semiconductor field, Singapore remains a key global player. “We are now probably number three in the world in semiconductor production,” he said. He also stressed that the future impact of AI will depend on how industries apply it rather than on AI development alone.

Talent and the Future Workforce

Addressing worries about job displacement due to automation, he acknowledged that manufacturing employment will likely shrink below 10 per cent of the country’s workforce. However, he emphasised, Singapore still needs to develop a workforce skilled in both engineering and digital technologies. He encouraged young Singaporeans to embrace hard sciences, stating that a strong foundation in mathematics and physics will always be valuable, while soft skills can be picked up along the way.

Johor-Singapore Economic Zone

Reflecting on Singapore’s approach to regional engagement, he noted that Malaysia and Indonesia remain essential economic partners. Of the Johor-Singapore Special Economic Zones, he said that while collaboration is promising, wage disparities could make it difficult to attract high-value industries to Johor. Instead, he suggested education, healthcare, and retirement services as viable growth areas for the SEZ.

Rule-breaking and Policy Innovation

When asked how Singapore should navigate future uncertainties, Mr Yeo encouraged bold policy experimentation. He recounted his own experience in sidestepping bureaucratic hurdles to push strategic projects forward, stating baldly, “If you break the rules, you must expect to be sacked.” However, he noted that taking calculated risks can be worthwhile if it was undertaken for the benefit of the nation rather than one’s self interest.

Conclusion

Mr Yeo concluded the session by urging Singapore’s leaders and young talent to stay adaptable, pragmatic, and globally engaged. His lecture provided thought-provoking insights into Singapore’s next phase of economic transformation in an era of geopolitical uncertainty, technological disruption, and shifting global trade dynamics.

Click here to watch the video of lecture I.