yes, but the truth is Singapore is authorianistic. S. korea and Japan are closer to being defined as being true democracies. at least 2 parties will always have a standing chance of ruling the country.
Singapore, right from its inception, has been ruled by the
https://www.pap.org.sg/ for 51 years without ever losing its grip- and this is very unlikely to ever change in the near future.
Rem, the 1 thing CPC cares most is the iron grip on ruling power. It's not gonna embrace economic growth at the cost and risk of losing its power.
In other words, it's the authoritarianism of Singapore that attracted China's attention.
INTRODUCTION It is easy to forget that a few decades ago state-owned enterprises (SOEs) were generally viewed as inefficient quasi-government departments which posed no meaningful competitive threat to privately-owned corporations. In fact, as recently as a decade ago, many pundits posited that SOEs were on the verge of extinction.1 Around that time, two American academic luminaries boldly declared the “End of History for Corporate Law” claiming that the market-oriented model of the shareholder-centric corporation had triumphed over its principal competitors (SOEs included).2 Over the last decade, however, the renaissance of SOEs has made comparative corporate law seem more like the beginning of time rather than the end of history. In this new era, SOEs have made a valiant return from the precipice of extinction and now compose a substantial portion of the world’s most powerful corporations. Indeed, SOEs have come to dominate several key global industries and are the backbone of the Chinese economy (which is on course to become the world’s largest economy).3 The meteoric rise of SOEs, combined with the spectacular economic growth of China, has made the future of SOEs in China an issue of global importance. The success and sustainability of China’s SOEs has been vigorously debated both within China and internationally. In the midst of this debate, however, a somewhat surprising view appears to be emerging: that Singapore’s SOEs (also referred to in Singapore as government-linked companies or GLCs) may provide a good model for reforming China’s SOE Model.4
In fact, very recently, the Chinese government decided that by 2020 the Singapore GLC Model would be replicated in China 30 times over—making this proposed reform potentially one of the most important corporate governance initiatives of our time.5 On the brink of such a watershed reform, it is tempting to jump quickly to make predictions about the impact that transplantingthe Singapore GLC Model will have on Chinese corporate governance. This article, however, avoids this temptation. Rather, it focuses on a more basic, yet fundamentally important, question that seems to have been largely overlooked in the rush to reform: What is the historical foundationand important drivers of the Singapore GLC Model? By answering this question, this article hopes to clarify exactly what Chinais aiming to transplant or, indeed, whether what China (or others) aims to transplant is even transplantable at all. Ultimately, this article concludes that the Singapore GLC Model is so closely intertwined with Singapore’s idiosyncratic history and unique regulatory culture that, although the model has been extremely successful within Singapore, transplanting it to China (and we suspect, most likely, anywhere else) could be difficult. In the process of arriving at this conclusion, this article further illuminates two broader points that cut to the core of comparative corporate law theory. First, as alluded to above, the success of the Singapore GLC Model and China’s ambition toemulateit challenge notions that corporate governance systems are converging towards a market-oriented (American) model of the shareholder-centric corporation.6 Indeed, an examination of the historical evolution of the Singapore GLC Model illustrates that a highly successful economy and system of corporate governance can be built on a foundation of corporations that have the government (and not only private free-market actors) as their ultimate controlling shareholder. Importantly, this feature of Singapore corporate governance has been maintained even as Singapore has moved from a developing, to a developed, and now to a world-leading economy that generates a GDP per person that exceeds all of the G7 countries7 and has produced the world’s highest percentage of millionaires.8
I. THE ATTRACTION OF THE SINGAPORE MODEL In 1960, a year after Singapore attained full internal self-governance, it had a GDP per capita of US$428 that was close to the world average10and faced significant challenges.11 Today, Singapore is one of the richest countries in the world. With virtually no natural resources, effective governance has been the key to Singapore’s success. This has not gone unnoticed. For the past eight years, the World Bank has recognized Singapore as having the best regulatory and economic environment in the world for doing business.12 Transparency International consistently ranks Singapore in the top five countries in the world for having the lowest level of corruption.13The Wall Street Journal and The Heritage Foundation consistently rank Singapore in the top few countries in the world with respect to economic freedom.14 The Asian Corporate Governance Association has repeatedly ranked Singapore as having the best corporate governance in Asia.15 At first blush, Singapore’s leading regulatory, free-market and corporate governance rankings suggest that it may be a poster child for the American-cum-global model for good corporate governance—which is built on the notion thatthe dispersedly-held, shareholdercentric, Berle-Means corporation is the zenith of efficiency.16 If one drills down a bit below the rankings, however, it quickly becomes apparent that Singapore’s corporate governance model is distinctly un-American at its core. In fact, the dispersedly-held, shareholder-centric, Berle-Means corporation virtually does not exist in Singapore. To the contrary, Singapore’s corporate governance system is built almost entirely on companies owned by concentrated block-shareholders. In fact, over 90% of Singapore’s public listed companies have block shareholders who exercise controlling power.17 In addition, empirical evidence suggests that as Singapore’s wealth has increased, its concentration of shareholdings has also increased—the opposite of what proponents of the American corporate governance model would predict.18Even more incongruent with the American, market-oriented, shareholder-centric model, is that listed companies in which the government is the controlling shareholder (i.e., GLCs) account for 37% of the total stock market capitalization in Singapore.19As such, the Singapore government is by far Singapore’s most powerfulshareholder. In this light, the initial attraction of Chinese Communist Party officials to the Singapore GLC Model appears obvious—
it provides a highly successful model in which the government remains the linchpin of corporate governance and the economy.
State capitalism:
Temasek holdings. Temasek is known as 淡馬錫 in mandarin
http://www.temasek.com.sg/abouttemasek/corporateprofile