Science `hub' to help offset Asian crisis

Business Asia, Nov 2, 1998

Singapore believes its development as a regional scientific hub is now even more critical because of the negative effects of Asia's financial crisis

Near Singapore's urban centre is one of the island's few remaining areas of colonial-style housing scattered across tracts of grassland and trees.

However, that space is due to be transformed from a window into the past to a taste of the future - a scientific hub along the lines of Silicon Valley.

The push for technology and competitive position has become crucial to this island-state of three million people because of the nation's lack of natural resources.

To compensate for this resources shortfall, Singapore has transformed itself into a "smart" nation that has few peers in the world.

The development of the Science Hub will further underscore the Goh Government's commitment to high-tech industries.

This will be the bedrock of a scientific community - to help assure Singapore's place as a regional technology centre.

"An entrepreneurial high-technology business environment will add a new dimension to the next phase of our economic development and assist our transition to a knowledge economy," Deputy Prime Minister Dr Tony Tan told a technology conference recently.

He said the Asian economic crisis made the development of new economic activities all the more urgent.

An area of 176 hectares, taking 15 years or more to develop and costing an estimated S$5 billion (US$3 billion), would be at the heart of the project.

When completed, the Science Hub would cover about 810 hectares where some 20,000 people would live, work and play.

Educational institutes, research and development firms and venture capitalists would congregate in the area with the aim of boosting "technopreneurship".

It would be an environment where business, technology and networking could mingle and flourish.

"Once a buzz has started, both local and foreign talents will be drawn in to be part of the exciting scene," National Science and Technology Board chairman Mr Teo Ming Kian said.

He said it was only through creativity and innovation that Singapore was able to differentiate itself from other economies.

Analysts and entrepreneurs said it made sense for Singapore to plan ahead for a time when its value-added manufacturing activities faced competition from regional economies.

Cost pressures had already forced manufacturers to shift low-end production to cheaper places, they said.

"I think it focuses more on R&D than manufacturing ... the prototype R&D will be done (in) Singapore," said Mr David Toh, technology analyst with ING Baring. The hub could be a place for pre- and post-manufacturing activities in future, he said.

Singapore's technology ambitions are sometimes contrasted with Malaysia's widely publicised Multimedia Super Corridor (MSC).

However, Singapore certainly appears to be forging ahead.

"I think Singapore probably has a head start because it has got a very open immigration policy ... (and it is) a financial centre, if you need venture capital for some of these startup firms," Mr Toh said.

Doubt surrounds the future scope of the MSC because of political and economic turmoil in Malaysia, but Prime Minister Mahathir Mohamed is an aggressive supporter of the project.

With that backing, it is likely to proceed, but foreign investors could be put off by Dr Mahathir's imposition of capital controls on the financial sector.

NSTB's Mr Teo said he saw the Science Hub and MSC being set up for different purposes, which need not be competitive.

"Such developments can have the advantage of mutually reinforcing each other. The pie can be enlarged as a result."

The Singapore authorities are already actively promoting the island as Asia's electronic commerce hub and encouraging the use of venture capital funds to kick-start local technologies.

"Good facilities will help to promote technological and R&D competency. That's what we're really after," said Mr Michael Yap, assistant chief executive of the National Computer Board.

Mr Yap, the man behind the government's plan to wire everybody up to the Internet, said the purpose was to create a place where people could come to exchange ideas and trade intelligence.