THE SEMICONDUCTOR INDUSTRY IN SINGAPORE : AN OVERVIEW

Abstract

The semiconductor industry is one of the fastest growing industries in the world. As a result, governments around the world have imbued large investments in order to gain a competitive advantage in the production of these high technology products. Likewise, the Singapore government, through its numerous agencies, has involved itself in the promotion of its domestic semiconductor industry. By having a greater understanding of the technologies involved, the specific nature of the local semiconductor industry, and the state of development of the local and international semiconductor industries, this thesis provides a framework for the analysis of the future prospects of Singapore's semiconductor industry. Emphasis on the changing nature of global competition is also necessary for assessing the viability of sustaining a competitive semiconductor industry. Despite the Singapore government's involvement in supporting the domestic semiconductor industry, its growth has been less than spectacular. To further stimulate development, the government should reassess its policy objectives so as to better formulate plans that can maximize the nation’s comparative advantage. The government should also redefine its contributions in the semiconductor industry by focusing more on its role as a catalyst of growth. Historical examples from developed economies show that direct government participation is often not the key to rapid growth in high technology industries. Hence, it is vital that the Singapore government acknowledges the limitations of industrial policy, and work towards strengthening the fundamentals of a strong economy.