AN APPRAISAL OF HIGH TECHNOLOGY INDUSTRIES IN SINGAPORE

Abstract

The impetus to move towards high tech industries stems from domestic and external factors. These include labour shortages amidst competition from labour surplus countries, protectionism in the developed nations and the need to keep up with the Asian NICs in the realms of technological developments. But what are high tech industries? Are they just industries with a high capital expenditure and high value-added? This academic exercise attempts to provide insights into what high tech industries entail in the Singapore context. In Singapore, most of the industries are not high tech as the definition suggests but are applications of high tech systems. Several reasons bear testimony to this statement. The state of research and development was found to be narrow and mainly concentrated in a few industries. Foreign technology is still dominant in the industries. This can be attributed to the narrow R & D base, which lacks skilled manpower to conduct these activities and to the multinationals' close guarding of their proprietary secrets. Case studies of firms in selected industries were made. The firms in the following industries were chosen for specific reasons: l) petrochemical industry for the high capital expenditure, 2) aerospace and biotechology industries are industries with potential for high growth and 3) information technology as it is difficult to talk about high tech without the use of computers. The experiences of these firms provide a framework to appraise high tech industries in general. More specifically, the information technology and aerospace industries can be considered "winners" as they have great potentials for further growth. The biotechnology industry is a fledgling industry that needs assistance, especially finance, before it can come of age. Inspite of it being branded as a white elephant, the petro chemical industry cannot be considered a "loser" but rather a "victim of circumstance"---the chief reasons being poor timing and competition from oil-producing countries. The case studies also provided insights to the problem· areas in high tech industrialisation. The evaluation of these problem areas of supporting manpower, infrastructure and time frame involved, led to the following conclusions about the present state of high tech industries. Singapore cannot compete with the advanced industrial countries in basic research. Hence, she is more likely to incline towards "middle tech" or "fillers" of high tech corners left by these industrial nations. Thus, Singapore has to be realistic about the level of technology that it can achieve given the constraints of size, manpower, infrastructure and financial resources. But because the risks of not going high tech are greater than the risks of going high tech, she has got to keep on trying.