Investors Unhurt by Singapore Xenophobic Fringe: Minister

Xenophobia in Singapore, confined to

a minority fringe, hasn’t had an impact on foreign investment in

the Asian country, said Law Minister K. Shanmugam.

“People accept that xenophobia is a minority,” Shanmugam,

who is also Foreign Affairs Minister, said in a May 26

interview. Savvy multinational companies “know that these

sentiments are there in every part of the world.”

Companies are adjusting to the city’s curbs on labor from

overseas after voter discontent over increased competition from

foreigners. Prime Minister Lee Hsien Loong this week deferred

S$2 billion ($1.6 billion) of construction projects to ease

demand for foreign workers in the country, where non-citizens

make up about a third of the workforce.

Singapore is taking the “middle path” in balancing the

needs of companies and citizens’ concerns, Shanmugam, 55, said.

“You have to mediate between the two,” he said. “If we

remove the foreigners, there’ll be a different impact on the

economy and the jobless numbers will be higher.”

Foreign chambers of commerce including from the U.S. and
Europe have warned that revisions to foreign labor policies

could hurt the Asian city’s economy, which is forecast to expand

2 percent to 4 percent this year. Singapore’s jobless rate rose

to 2.1 percent in the first quarter from 1.8 percent in the

preceding three months.

Rule of Law

“Companies that require large amounts of labor force will,

of course, redo their calculations,” Shanmugam said. Foreign

investors recognize Singapore’s advantages including

intellectual property protection, rule of law and high-quality

labor and logistics, he said.

The city’s population has jumped by more than 1.2 million

since 2004 to 5.4 million, driven by immigration. Thousands of

Singaporeans protested a proposal to boost the population to 6.9

million by 2030.

The ruling People’s Action Party, as a left-of-center

social democratic group, has to focus on social policies such as

housing and education to address the effects and stresses of

globalization, Shanmugam said.

“A significant portion of the population either feel

stressed because of job security or feel stressed because of

competition from foreigners, without being xenophobic,”

Shanmugam said. “We have to admit that there’re legitimate

stresses.”

A British wealth manager was forced to leave the city in

January after mocking local residents who have to use public

transport and a Philippine independence day celebration for the

Filipino community in Singapore was canceled this week after

protests by Singaporeans.

That was followed by a May 28 call by 12 civil society

groups for a rejection of racism and xenophobia which they said

had surged recently in Singapore.

To contact the reporter on this story:

Andrea Tan in Singapore at

atan17@bloomberg.net

To contact the editors responsible for this story:

Douglas Wong at

dwong19@bloomberg.net

Linus Chua

Investors Unhurt by Singapore Xenophobic Fringe: Minister