Business Lounge
Jamaica and Singapore
Leadership and Entrepreneurship
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amaica and Singapore, two island states that emerged from British colonial rule at the halfway point of the last century, are often compared most times to rue the missed opportunity for the former to become as economically viable as the latter. In 1965, the Gross Domestic Product (GDP) in US dollars was $2,850 per person for Jamaica, a figure slightly higher than Singapore’s $2,650. By 2006, Singapore’s GDP was $31,400 per person while Jamaica’s figure stood at $4,800, a drastic difference to say the least. So both countries started out almost evenly matched, in fact Jamaica might even have enjoyed a slight edge with more natural resources and a greater potential for a robust tourism industry. What are the reasons for the disparity in growth and which of these reasons has a possible solution? After independence Singapore, which is fortuitously located on key shipping lanes to and from East Asia, invested aggressively in strategic infrastructure such as its port, which led to a steady source of income from the seas? While Jamaica meandered through years of political and economic instability highlighted by the turmoil of the 1970s, Singapore subsidized education, maintained an open and corruption free economy and created a sovereign fund that was used to make key international investments. All of these developments can all be attributed to two extremely poignant differences between the two countries, leadership and long term emphasis on fostering entrepreneurship. Leadership Jamaica cannot boast a leader like Singapore’s Lee Kuan Yew, who stepped down as Prime Minister in 1990 after 31 years in power. Lee’s style of government was direct, forceful and totally singular in its promotion of Singapore, some say he ruled with an iron fist without the velvet glove. His style of government is unlikely to have been welcomed in Jamaica where Western thoughts on democracy and leadership would have influenced many of the policy changes that Lee implemented. Population control campaigns with strong incentives for families with two children worked wonderfully in helping to curb Singapore’s runaway population. The shorter maternity leaves and higher hospital fees might not have gone down so well with Jamaicans.
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While Jamaica meandered through years of political and economic instability highlighted by the turmoil of the 1970s, Singapore subsidized education, maintained an open and corruption free economy and created a sovereign fund that was used to make key international investments.
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of speech isn’t as valued in Singapore as it is in the West, criticisms of the government was usually met with prompt ramifications. The point is that Lee Kuan Yew’s vision of Singapore prospered with the help of his brand of leadership but the differences in the social makeup of the people of the two countries means that one size does not fit all. So if emulating governance is a less than viable option, what of the emphasis on entrepreneurship? advertisment
The Central Provident Fund, which is used by Singapore’s government for economic development is financed by savings of 25% of each worker in the country, the savings are then made available when said worker reaches the age of 55. A perfect mix of socialism and government capitalism that if implemented would probably have cost a party an election in Jamaica. Discipline in Singapore’s society is extremely high with severe punishment meted out for the slightest of infractions, from noise restrictions to graffiti and street side activities. Freedom yourmoney ezine
Business Lounge
Jamaica and Singapore Leadership and Entrepreneurship
The New Wave Currently, Singapore boasts over 50,000 businesses being formed annually, which works out to approximately 103 for every 10,000 Singaporeans, a figure which eclipses states such as the United Kingdom with 53 for the same number of people. This focus on entrepreneurship was fostered by a government that has employed a wide range of tactics designed to stimulate entrepreneurship. From providing public funds for venture investors who are interested in setting up shop and subsidies for firms in targeted areas to encouraging potential entrepreneurs and mentoring fledgling enterprises and even an award for failed entrepreneur which supposedly rewards risk-taking and hopefully not bad management.
preneurs is one thing but it is impossible for entrepreneurs to function in an environment that is not entrepreneur friendly despite the amount of money handed out. Reducing the barriers to entry is extremely essential. That being said the government should resist efforts to micromanage the sector and instead allow the sector to grow as organically as possible. It is evident the impact that a strong entrepreneurial emphasis can have on a society and with our eyes opened and work already being done, its time to be a part of the new wave.
While Jamaicans have long had the spirit of entrepreneurship ingrained into their psyches as confirmed by a 2006 Global Entrepreneurship Monitor survey which placed it among the highest of the 42 countries surveyed, doing business in Jamaica is especially hard. In the World Bank’s Doing Business series Jamaica ranked 170 out of 178 with regards to the burden of tax compliance.
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While Jamaicans have long had the spirit of entrepreneurship ingrained into their psyches as confirmed by a 2006 Global Entrepreneurship Monitor survey which placed it among the highest of the 42 countries surveyed, doing business in Jamaica is especially hard.
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The analysis says that 50% of the entrepreneur’s profit goes to tax and the processes surrounding being tax compliant. With so much of a business’s cash flow being redirected to taxes it is unlikely that the business will have the resources to actively invest in the areas that it needs to grow. For comparison, Singapore’s burden is 23%. Even the cost of registering property in Jamaica is exorbitant at 13.5% compared to the United States 0.5%. This means that less entrepreneurs register their holdings resulting in less assets to be borrowed against, a critical step in growing any business. The significance of entrepreneurial emphasis is highlighted all the more by the disparity in growth between the two countries and while Jamaica has caught on it is necessary that public figures note a number of things. Providing capital for entreyourmoney ezine
insights
Lebron james
vs The Billionaires
W
hether or not you are a fan of Lebron James or even basketball, it would be hard to miss the dog and pony show that the 25 year old NBA superstar’s free agency negotiations has become. A free agent in professional sport is a player whose contract has expired and is therefore able to sign with another franchise. With a player like Lebron James, whose value to a team is as undeniable to his league’s attempt to create artificial hype around players that they think are marketable, the franchises that are able to pay him the exorbitant figures that he is “worth” are queuing up hoping that James makes the choice to hop onto their bandwagon. For an industry steeped in the selling of concocted images and hype, this type of media attention and financial speculation is helium to a player like James’ narcissistic balloon. There is a three letter word that starts with the letter “e” and rhymes with “amigo” that obviously governs the participation in and management of professional leagues. Owning a sports franchise often seems to be a massager of the aforementioned three letter word rather than a sound business investment especially when your business is subject to the whims of an egomaniac the likes of Lebron James. Where else do you find billionaires at the complete mercy of their so-called employees? Former NBA star Latrell Sprewell famously asked of a franchise that offered him a $30 million, 3 year contract, “How am I supposed to feed my family with that?”
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When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is usually the reputation of the business that remains intact.
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hype for the NBA. Decision 2010 sounds like a presidential election but it is merely the selection of where the “King” rests his throne next; marketers twitch nervously, agents rub their palms greedily and fans wait to see when the less important game will start.
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Warren Buffet has a saying that is quite possibly the reason a sports franchise is not one of his holdings, “When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is usually the reputation of the business that remains intact.” Dan Gilbert, the owner of the Cleveland Cavaliers, James team, has repeatedly insisted that he will not grovel for James to stay despite the obvious value of a player who transformed one of the poorest franchises into a powerhouse despite being unable to transform hype into silverware. It just all seems a bit silly and I suppose that Americans place such high value on their sports superstars that all of us including the billionaires are at their mercy. James has repeatedly stated that he wants to become the next billionaire athlete, joining the heights of a certain golfer, an aspiration that is becoming increasingly tangible. So, the self-made billionaires line up to court, forgive the pun, the aspiring billionaire and at the same time create unimaginable yourmoney ezine
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