Lee Kuan Yew speaks about Singapore's changing demographics

SINGAPORE: Singapore former Minister Mentor Lee Kuan Yew said a country that does not grow its population risks dissolving "into nothingness".
Mr Lee was speaking at a wide-ranging dialogue session organised by Standard Chartered Bank on Wednesday evening.
Joining Mr Lee for the dialogue was former chairman of the US Federal Reserve and former chairman of US President Obama's Economic Recovery Advisory Board, Paul Volcker.
This was the first time Mr Lee was speaking about Singapore's changing demographics since the Population White Paper was endorsed in Parliament.
The paper, which projects 6.9 million people by 2030, charts the country's strategies in managing a shrinking and ageing population.
A question on Japan's ageing society during the dialogue triggered the discussion.
Mr Lee noted how Japan refused to take in migrants and that led to the situation it is facing today.
Mr Lee said: "So I see a nation reduced to half in 20 years, and if it still continues with the same policy, reduced to a further half, and eventually, it is all over!
"To have a nation, you must have people and you must have young people to be able to drive the economy and young people buy the products - all these gadgets and fine dining - and if you don't have that, and you refuse migrants as the Japanese do, you will just dissolve into nothingness! I think before that comes, they may change (their) policy."
A question on China's one-child policy was also raised during the dialogue.
Mr Lee said China is headed in the wrong direction with this policy as a shrinking and ageing population will mean assets, such as property prices, will go down.
"Property prices will go down, assets will go down. There is no younger generation to put the pressure up so I think it is heading towards the wrong direction," said Mr Lee.
He added Singapore is in a similar position with its low total fertility rate but the difference is that Singapore takes in migrants to make up for the numbers.
Mr Lee pointed out that authorities here maintain a "certain quality of control" and that is one reason why he feels other emerging ASEAN economies are unlikely to surpass Singapore anytime soon.
Mr Lee said: "They will make progress but if you look at the per capita they have got, the differences are so wide. We have the advantage of quality control of the people who come in so we have bright Indians, bright Chinese, bright Caucasians so the increase in population means an increase in talent."
Article credits CNA

When retailers are in tears, Mustafa is doing roaring business. What is the magic?

They call him the Rajah of Serangoon Road and with good reason. While many retailers are suffering losses, downsizing, or have completely given up and moved out, Mustaq Ahmad's department stores in the Serangoon Road area are doing a thriving business. On a mid-week afternoon, the store is packed with customers and you have to squeeze through the crowd to get to Mr Ahmad's office on the second level of Mustafa Centre, at Syed Alwi Road. The managing director of Mohamed Mustafa & Samsuddin Company (MMSC) has another store round the corner at Serangoon Plaza. Already known to the public as an unaffected and humble man with assets worth well over S$100 million, Mr Ahmad greets you behind his plain desk with a patient look on his face and the opening line: "People always ask me 'how do you do it?' But there's nothing new to this business, it's basically buying and selling." Still, he fields your questions with the fortitude of a man accustomed to the media probing him for the secrets to his success. Born in India, the 45-year-old has come a long way since he started a shop in Campbell Lane selling ready-made garments with his father and uncle back in 1971. For the current financial year ending June 1997, he estimates sales of between S$230 million and S$250 million from the stores' combined shopping space of 150,000 sq ft. But profitability is "still on the low side" because of the S$45 million Mustafa Centre which was opened last April. "But we're satisfied with it," says Mr Ahmad. And why not? Last financial year, net profit stood at S$3 million and for the current year, he's projecting some S$5 million. Naturally, this figure wasn't plucked from the sky in some misguided sense of optimism. The sales will come from the daily weekday traffic of 10,000 and weekend traffic of 15,000 to 20,000. And the crowds are still growing. Yet, it can't be the ambience that is pulling in the crowds. At first sight, Mustafa's looks like a window designer's nightmare. Merchandise from chilli crackers to sequinned handbags and portable radios are stacked unglamorously against windows and along the aisles on the floor. The reason is simple enough: the store is quite literally bursting at the seams. "There just isn't anymore space," came Mr Ahmad's simple answer. "With nice displays, you lose 4 to 5 times more space. Basically, people come here to buy things and not to look at displays. We're not promoting any products, we are selling promoted products. So let someone else promote them and we'll do the selling." A more obvious reason for the stores' attraction is its pricing. While some department stores are trying to go up market and targeting customers with big spending power, Mr Ahmad aims for the mass market. "At our shop here, we believe everybody is a customer," explains Mr Ahmad, pointing out that maids and employers shop there together. Mustafa's is also a favorite of Indian and Bangladeshi foreign workers. "We have a lot of things which most people can afford and anybody can come in and find something for themselves. Customers can buy small things and all these small things can add up to a big volume. At the same time, we also have bigger ticket items, so there'll be a product for everyone." Mr Ahmad says he also offers lower mark-ups compared to other stores. "Of course we make money," says Mr Ahmad. "But we work it out such that we have a smaller mark-up and customers get the lowest market price, but we have enough margin from a big turnover." Gross profit margin on products is at an average of about 15 per cent at his stores, with some ranging from 10 to 30 per cent. The reason why his stores can keep prices low is because they buy in much bigger quantities and can therefore negotiate for lower prices. "And if there's a big price difference in the market, we parallel import the goods," says Mr Ahmad. Parallel imports, which range from electrical products to perfume, make up about 20 per cent of the goods. "Although we only have two shops here, we do a lot of homework and my staff will travel to buy these goods," he reveals. But just when you think his secret is all down to a pricing strategy, Mr Ahmad tells you it isn't all that simple. "It's not just the price, it's the real thinking behind it," he emphasises. "We ask ourselves if we are going hand-in-hand with customers or if we are just trying to sell them things." Taking the tourist business as an example, Mr Ahmad says the visitors are quite prepared to spend, but some retailers think they should therefore make as much money from them as possible. "But if he finds out the price difference, he will not come back," he points out. "The normal price is the price that will build trust, even though it's not necessarily the cheapest." At the same time, the method of pricing is also important. According to Mr Ahmad, MMSC's products are presented without a lot of hidden cost. For instance, if the price tag of an electrical product at his stores says S$300, it already includes the 3 per cent goods and services tax (GST). "Someone else could have a S$299 price tag, but have yet to include the GST, plus S$10 for delivery and so on. So in the end, the customer pays S$320," he explains. "It's a very simple method we use without being afraid that someone will beat us with a S$299 price tag. That's where the confidence comes in." Although customers may take some time to realise this, they keep going back to his stores when they do. "This is because they know there is something different, there's honesty," says Mr Ahmad. "Then we're a little bit better than the next store." Of course, the fact that MMSC stores have a wide range of products also helps. Because of its location in Little India, MMSC's complete range of Indian supermarket products makes it very popular. So even though there are Indian spice shops in the area, they can't beat MMSC stores for their range, and hence, the convenience. And instead of fancy carrier bags, MMSC stores use plastic bags which are tied with a security tag once the items have been paid for. This may not exactly look elegant, but it certainly is an effective method against pilfering, which stands at about 0.5 per cent, compared to some stores with a rate of between 3 and 4 per cent. While the MMSC stores don't look expensive, Mr Ahmad emphasises that its goods aren't cheap either. "Customers don't care about the seller's problems, as long as the price is fair," he states. So instead of frequent sales, he keeps his prices steady. "This is business we are building everyday, because we can't promote everyday." Although many retailers expect the poor trading conditions to continue for some time, Mr Ahmad believes the outlook is good for his business. "There's a lot of opportunities, not only here, but all around the world," he says matter-of-factly. "We're short of space, but not short of customers. We can open a shop anywhere, as long as we have our own niche market and can use our way of doing business." The fact is, Mr Ahmad is confident that if he were to set up this type of stores in Kuala Lumpur, Jakarta or Hongkong, it will be a hit. But don't mistake this for arrogance. "Why am I confident? Because we find that there are certain weaknesses in the market, so we take the opportunity to remove those weaknesses and provide for the customer," came the simple reply."A lot of big businesses don't have confidence in doing things." And this confidence means that if he pays $1 for item, no one can pay 50 cents for it, and he can sell it to the customer for $1.20. "It's a fair price, but not the cheapest," emphasises Mr Ahmad. "Those who think cheapest is the fairest come into the market and then disappear because expenses are more than their income. Some others think they want to make as much profit as possible, but this doesn't match because the market cannot accept it." "So the question is at what levels can the market accept the prices," he says. "That's the trick of the game." The difficulty is of course, how to read market correctly. And that, according to Mr Ahmad, comes down to how much a person is involved in the business. "If a person shows enough interest, he can create a niche market," he believes. "Just study the needs of a particular group of people and fit their needs. Everybody needs their daily necessities right? So the business is there already." The other thing he believes retailers should do is to retain whatever they started out selling. "So if you were selling artificial jewellery, and want to sell gold as well, then keep both," he says. "And when you add diamonds, you should sell all three. You have to build on existing business because you've done it successfully and if you maintain your bread and butter, you're safe." With his business cruising along, what are his expansion plans? "We're very satisfied with how we're doing and as and when things come up, we will expand," says Mr Ahmad. "But for us to set up anywhere, we need a big capital, and there's no magic show where we can set up without it." Although renting is easy, that is not an option for him because "rentals will go up and you'll be at the mercy of your landlord". Another way to gain capital quickly is to invest in high leverage business "and get headaches everyday". But this is not a prefered choice as Mr Ahmad would rather take it at a more unhurried pace. "We can take whatever challenges as long as we don't put too much worry on ourselves or stress on our health," he says in his laid-back manner. Raising funds through a public listing is yet another possible -- and much faster -- means of financing a business, but MMSC is only just "thinking about it a little bit". "If we want to move fast in the market, we might do that, but if we decide to move slowly, we can remain like this," he says. "We're not aggressive in the sense of wanting to reach this or that target in a certain year. We are very comfortable with this speed." One thing's for sure though. With 60 per cent of his customers being locals and 40 per cent tourists, Mr Ahmad would like to see more Singaporeans of all races visiting his store. "Right now, Indians form about 65 per cent of customers, so we need more Chinese shoppers." So far, the only expansion plan that's certain is his proposal to convert the 130 hotel rooms above Mustafa Centre into an additional 45,000 sq ft of retail space. Having said all that, Mr Ahmad's business philosophy boils down to taking care of the people he's dealing with. His staff, customers and suppliers attest to his friendly and easygoing nature, largely because he isn't stuck in some plush boardroom holding endless meetings, but meeting them regularly on the shopfloor. Of course, there's also the 'X' factor -- Mr Ahmad's ability to understand the consumer psyche, and his swift reaction to changes in consumer demands and expectations. But just when you think you've got Mr Ahmad's business strategy in a nutshell, he surprises you. "Whatever I say, tomorrow, the ideas might change," he says with a shrug. "Because tomorrow is another day." Article Credits -Corinne Kerk

Former Minister Mentor Lee Kuan Yew about Environment

World’s thinnest hard disk drives released in Singapore

Singapore’s Data Storage Institute launches A-Drive, One of the world’s thinnest hard disk drives At 5mm, the A-Drive, a hybrid hard drive developed by A*STAR’s Data Storage Institute (DSI), is one of the world’s thinnest in a 2.5″ form factor. It’s also one of the world’s first — the other being Western Digital‘s hybrid hard drive, which is also 5mm thick. The new drive was unveiled on 1st November to commemorate DSI’s 20 years of research. The A-Drive, which could be commercialized within a year and retail at USD60, can provide up to 1TB of hard disk drive (HDD) space and 23GB of solid state drive (SSD) space. That’s about 250,000 songs. Compared to SSDs, a hybrid disk drive provides more storage space at less cost and power consumption. If placed in tablets, which uses SSDs, it could extend storage space while prolonging battery life by 30 percent. It could be used in ultrabooks as well, where thinness is a priority. Dr Pantelis Alexopoulos, executive director of DSI, told Yahoo! that the A-Drive is also more secure. When an SSD is lost, its encryption code can be broken. That’s not the case for the A-Drive, he said. The hybrid drive could be sold as portable devices, or they could come baked into mobile devices through working with OEMs. Enterprises could be a potential market as well, where it can cut power usage by half. DSI is currently discussing with partners to market the device in Singapore. Dr Alexopoulos posited that getting from a partnership deal to manufacturing would take about 6 to 8 months. Patents for the design of the hybrid drive’s axial field motor, along with 30 other designs, have been secured.

Foreign labour tightening has affected businesses of some small and medium companies

SINGAPORE: The gradual tightening of foreign labour regulations has affected businesses of some small and medium companies. That is according to a recent survey conducted by the Association of Small and Medium Enterprises (ASME). The survey also showed that some companies are looking to relocate or have already relocated overseas due to difficulty hiring in Singapore. It was conducted last month based on the ASME's 6,000 strong members. In the survey, two in five SMEs said that the recent manpower policies have negatively affected their business. About three in 10 SMEs indicated they have moved or are thinking of moving their operations elsewhere. The rest who are not looking to relocate said they are still cautiously monitoring the current business environment and labour shortage in Singapore. ASME's president Mr Chan Chong Beng said: "We have also heard people not expanding at the moment because they are waiting for a clearer picture to come and any additional expansion could be a burden to them. Mr Chan added: "The next alternative is to relocate to a cheaper country and we have seen companies who have relocated to Malaysia and the trend will continue because you want to survive." Acting Manpower Minister Tan Chuan-Jin recently cautioned that the pace of cutting foreign labour dependency must be managed to avoid prompting firms to relocate. This may cause retrenchment and higher unemployment among Singaporeans. The current labour crunch faced by companies includes skilled workers. But recent figures revealed the number of skilled foreign workers in the S Pass category, rose by some 12 per cent. As of June this year, there were 128,000 S Pass holders, as compared to 113,900 last year. These are for workers earning at least S$2,000 a month. The number of employment pass holders dropped by 0.4 per cent for the first half of this year. The contraction could be due to tighter requirements such as higher minimum salary, which was introduced in January. It is possible that companies are using S Passes to bring in more junior level PMEs. President of the Singapore Chinese Chamber of Commerce and Industry, Teo Siong Seng said the sentiments on the ground may be different. Mr Teo said: "The real feeling on the ground, especially among my 40,000 members is that in fact they are facing a very severe manpower crunch, especially the SMEs. "I think the government may need to release more figures as to exactly different sectors of the business industries, what are the net increase or decrease, in the work permit, in the S-Pass and also in the Employment Pass." The Manpower Ministry said it will be taking a closer look at S Pass holders. Chairman of Government Parliamentary Committee for Manpower Zainudin Nordin believes there is a possibility of further tightening for this group of foreign workers. Mr Zainudin said: "If there is no progress in building productivity or building the Singapore core, then something has to be done because as long as there is still the option of and the availability of cheap labour source, people will also make that option. "I would expect the government to tighten measures to ensure that we go towards less dependency of foreign labour because in my view, it's just not sustainable." The government had indicated that it is on the right track in reducing dependency on foreign labour but this will take time. Channel News Asia Reports

Tightening of foreign labours has negative impact on business owners

WHO issues guidance on new SARS-like virus

GENEVA — The World Health Organization on Wednesday urged health workers around the world to report any patient with acute respiratory infection who may have travelled to Saudi Arabia or Qatar and been exposed to a new SARS-like virus confirmed in two people so far. The United Nations agency put out a global alert on Sunday saying a new virus had infected a 49-year-old Qatari who had recently travelled to Saudi Arabia - where another man with an almost identical virus had died. The Qatari remained critically ill in hospital in Britain, according to the WHO’s latest information as of Tuesday. The WHO said on Wednesday no new case of acute respiratory syndrome with renal failure due to the new virus had been reported but its investigations continued. “We’ve got things in place should things change, should the behaviour of the virus change,” spokesman Gregory Hartl said. The WHO said it was working closely with Saudi authorities regarding health measures for the haj pilgrimage to Mecca next month when millions of Muslims travel to the kingdom and then return to their home countries. Its clinical guidance to 194 member states said health care workers should be alert to anyone with acute respiratory syndrome that may include fever (above 38oC or 100.4oF) and cough, requiring hospitalisation, who had been in the area where the virus was found or in contact with a suspect or confirmed case within the previous 10 days. The virus, known as a coronavirus also related to the common cold, comes from the same family as SARS (Severe Acute Respiratory Syndrome) which emerged in China in 2002. SARS infected 8,000 people worldwide and killed 800 of them before being brought under control. The WHO said it was identifying a network of laboratories that could provide expertise on coronaviruses to countries. “Though it is a very different virus from SARS, given the severity of the two confirmed cases so far, WHO is engaged in further characterizing the novel coronavirus,” it said, referring to genetic sequencing. Hartl, speaking to reporters on Tuesday, said: “This is not SARS, it will not become SARS, it is not SARS-like.” It was not established whether the virus spread by human to human contact or just how it was transmitted, he said. “We don’t know if all cases of infections are as severe as the two cases we have currently or in fact whether there have been 2 million cases of this virus and only 2 severe cases.”