SINGAPORE’S GDP per capital stood at close to US$53,000 in 2016, among the highest in the world. GDP in Singapore has been partly fuelled by the rising cost of living in the country.
In November, it was reported that the Economist Intelligence Unit’s (EIU) Worldwide Cost of Living survey had found that Singapore was the most expensive city in the world for expatriates. This was the fourth straight year that Singapore received this dubious ranking.
After the release of a similar EIU expensive city finding in 2015, the government noted in March 2016 said that the survey doesn’t reflect the cost of living of Singaporean households. It cited three reasons:
- All prices are converted from local currencies to US dollars, which means that the rankings are sensitive to currency fluctuations.
- The items in the EIU consumption basket are quite different from the goods and services regularly consumed by Singaporeans.
- The prices of comparable items in the EIU survey are higher than what Singaporeans pay.
Take Another Survey
The same reasoning likely applies to the most recent EIU survey. More recently, there is further evidence that Singapore is not as expensive a place for expatriates as previously thought. According to the results of a Cost of Living survey by ECA International released in December last year, Singapore has dropped out of the top 20 most expensive locations in the world for expatriates. It ranked 21st, its lowest ECA International ranking since 2015.
The authorities are likely more comfortable with the ECA International rankings than they are with the EIU rankings. However, on the ground, how do costs for expatriates translate to costs for locals?
If things are expensive for expatriates, the same things should be just as expensive for locals and vice versa.
In Singapore, you don’t see people advertise different prices for locals and expatriates on basic household necessities. If you go to a pub for a drink, the price of beer is the same for locals and expatriates. If you go to a petrol station, a local will pay the same price for petrol as an expatriate. Both locals and expatriates are subject to the same government taxes on alcohol content and petrol.
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This should not be mistaken to the government subsidies for locals in areas like healthcare, education and transport. Subsidies do not typically have an impact on actual costs.
Indeed, the fact that there are subsidies for such services is an indirect admission that they are expensive in the first place.
This conversation about the high cost of living in Singapore is sparked by a recent Lianhe Wanbao report about hundreds of people queueing for hours outside a Balestier Road temple to get a hongbao of S$20. There was a photo in the report of many people carrying umbrellas and standing in a queue.
An old lady was quoted by the newspaper as saying “I live alone and really need the money, so I came earlier.” According to the report, she queued for 16 hours which means she transitioned into the New Year waiting in a queue for S$20.
Fake News?
The worrying thing was that, as far as we can tell, this piece of news about the queue at Balestier Road was not reported in the English mainstream media. You can’t find a trace of it there. It makes you suspect that the Balestier Road queue may have been fake news, and all the details are untrue, including the photo. Still, since it was reported on January 1, there hasn’t been any outrage from the authorities and grassroot leaders about it being fake news.
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So, if you accept that fact that hundreds of people actually waited hours for S$20 each, then how meaningful is Singapore’s lofty GDP per capital to such locals? What is the point of a high GDP per capita when the country can’t get the basics right, namely looking after the casualties of Singapore’s economic success without judgement, some of who are from the pioneer generation who helped build the country in the first place.
While the government is helping the pioneer generation with subsidies, there are still many who fall through the cracks. Here is something that a number of great people have alluded to over the years, albeit in different words: “A society will be judged on the basis of how it treats its weakest members.”
Spending your New Year’s Eve queueing for a paltry $20 is simply not something that a proper society should allow.
Thus It Was Unboxed by One-Five-Four Analytics presents alternative angles to current events. Reach us at 154analytics@gmail.com
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