Book summary- Crossroads: A Popular History of Malaysia and Singapore

MONSOON ASIA

Climatically, Malaysia is part of what is often called Monsoon Asia. Monsoons are strong seasonal winds that blow from the northeast from October to March, and from the southwest during the remaining part of the year. These winds bring tremendous amounts of rainfall, especially the northeast monsoon.

The climate of the region had an impact on the attitudes and lifestyle of the people who lived there. It produced a slow-paced life that reflected the heat and periods of inactivity caused by monsoon rainfall.

Among the Chinese immigrants and Europeans, this acceptance fed a stereotype that the Malays were lazy and easy-going. It is not that they did not work hard; rather, they just had a different view of when and how to work.

 At the Crossroads

Each succeeding trading power that arose realized that the keys to controlling trade between the Pacific and Indian Oceans were the Melaka and Sunda Straits.

As sailing technology improved, Malaya became a middleman for trade involving India, the archipelago and China. The Europeans followed, searching for spices and to control trade with China. With the rise of British naval power, Malaya provided ports of call and military bases.

A further significance to Malaya’s location culturally that went beyond its position astride these key straits was its access to and its integral position in archipelago Southeast Asia.

Much like in its European counterpart, the economic, cultural and racial interactions that took place within the archipelago were key components in molding the society that emerged in the peninsula and in Borneo.

The historical interaction continues to this very day. With the growth of the Pacific Rim economies, Malaysia and Singapore play important roles in the trade between the Pacific Ocean and the countries east of them.

Both Malaysia and Singapore derive great benefits from the economic and cultural interaction that takes place as a result of their integration in the archipelago. They are truly at the crossroads of the world.

Kampung Culture

Prior to the twentieth century, before a modern infrastructure of roads and railroads was built, geographic realities also contributed to kampung culture.

Mutual assistance was necessary for survival, and communal life was based on a cooperative legal system called adat (traditional law). Adat incorporated two key principles: compensation, which was preferable to punishment, and mutual responsibility.

If you wish to insult someone in English or Chinese, you accuse them of unnatural sexual acts or compare them to parts of the body that are seen as unclean. The Malay language traditionally had little such vocabulary, although literal translations from English have crept into the language in the cities.

The worst insult to most Malays is to be kurang ajar (lacking in manners). The phrase literally means “little teaching.” Its use as an idiom reflects the cooperation and courtesy of kampung life.

Islam and Malay Values

The conversion of the peninsular Malays to Islam took place in the fourteenth and fifteenth centuries and added another dimension to the nature of kampung life and Malay values.

One reason was the Muslim belief in the community and equality of believers.

Given the nature of kampung life and its sense of group-directed behavior, Islam was seen as a faith that bound the village even closer together and offered clearly delineated codes of behavior.

Another attraction was Islam’s belief in predestination.

For rural people, whose lives were controlled by the cycles and whims of nature and were already fatalistic, the idea of one God directing the daily fate of each member of society had great appeal. This was an aspect of the uncomplicated nature of Islam that was not evident in other religions and beliefs to which they had been exposed. Islam was a religion that was relatively easy to understand because it fit their society.

It would seem that Islam would be in direct conflict with many traditional Malay beliefs, but the Malays found ways to accommodate the two.

The Islam that came to Malaya had already passed through India and Indonesia and thus was somewhat more accommodating and adaptable to the local culture than the Islam of the Middle East. Islam weakened adat law but did not replace it.

Language, Literature and Legends

Traditional Malay and Indonesian literature is heavily laced with stories that have origins in Hindu epics, such as the Ramayana and Mahabharata, which were often told in wayang kulit (shadow play) performances.

The state of Kelantan banned wayang kulit in 1990 for its un-Islamic messages, but the art form reinvented itself as a presenter of folk tales rather than Hindu epics and was reinstated in 2006.

Although a Greek, Alexander the Great played a significant role in Islamic history and legend as Islam worked its way east into Southeast Asia.

Revisionist Persian historians made Alexander a follower of the one true God who was converted by the Prophet Khidir. Alexander’s conquests in the Muslim world were justifiable because he was part of Muslim tradition.

Thus there are Muslim royal families in Malaysia who trace their heritage to the Greek, Alexander the Great.

DUTCH CHALLENGE PORTUGUESE TRADE

Two of the largest ports in the world today are Singapore and Rotterdam. By collecting and selling the goods of other countries, both have used their geographical locations to become centers of trade.

While the Portuguese and Lisbon were the source of products from the East, the Dutch were the distributors of these products in western Europe.

The ban on access to some of their most lucrative trade became a primary motivation in the Dutch desire to cut out the middleman and seize control of the commerce from the East, especially that of the archipelago.

Many Dutch sailors had traveled with the Portuguese to the East and had learned Portuguese navigational and sailing methods. During these voyages, the Dutch had also observed that Portuguese control over their trading empire was weak.

The secret was out – Portugal was vulnerable and unable to defend its far-flung empire. This knowledge and Dutch advances in naval technology gave them the tools to challenge Portuguese trade between Europe and Asia.

Thus, by the end of the sixteenth century, a mixture of nationalism, economic necessity and maritime knowledge created a new player in the trade of the archipelago – one much more formidable than the Portuguese.

The vehicle for the creation of Dutch trading dominance was a joint stock company called the Dutch East India Company (VOC). By the second half of the seventeenth century, it had an army of 10,000 men and an armed fleet of hundreds of merchant and naval vessels and was virtually a law unto itself.

In today’s world, a comparison would be to give a major oil company total control over all the oil coming out of the Persian Gulf.

RENEWED INTEREST IN ASIA

A persistent problem was what to trade in exchange for tin and tea. There was little Britain had that China wanted, either from Europe or India. Traditionally, the British had traded cotton textiles from India for straits tin and Chinese tea, but the competition was fierce because the Dutch and Arabs were also involved in the textiles trade.

Thus the British had to pay for tea and tin with silver, which depleted the nation’s reserves and was contrary to the entire idea of a profit-making mercantilist trading empire.

In the eighteenth century, this problem was solved when the EIC went into the opium business. Opium had been a trading commodity for some time but on a relatively minor scale.

What the EIC did with opium make the Colombian drug deals of the 1990s seem almost insignificant. They traded it legally, were backed by their own army and navy and had government control over the areas in India that grew it.

By paying Indian farmers to grow opium and promoting the trade with credit facilities to country traders, the British had the perfect trading commodity – a product that would create a demand for more and on which they had a monopoly.

The combination of European power rivalries, the general increase in trade and the boost given to trade through the sale of opium reinforced the need for a British base and port in the archipelago.

They needed a place to collect the tin and spices, a port of call in the trade between India and China and a naval base to protect that trade.

The final reason for the British return and subsequent dominance of Malaya was the weakening of opposition to their presence in the archipelago.

The Dutch had superior military strength against local powers, such as the Bugis, but not against a country that was as strong and committed to its course as Britain was.

FOUNDING OF PENANG

After Britain lost its American colonies in 1783, the EIC began to search for a base in earnest. Once again, Kedah made an offer through Light, this time requesting protection from Siam, which had become powerful in the eighteenth century.

Light accepted Sultan Abdullah’s offer of Penang Island, although it is unlikely that either he or the EIC had any real intention of protecting Kedah from its enemies.

In 1786, Light hoisted the Union Jack in a settlement on Penang Island, which he called Georgetown after King George III. Britain had its first foothold in the Straits of Melaka.

It is said that Light paved the way for British occupation by shooting silver dollars from cannons to clear the jungle of unwanted growth and gain the goodwill of the Malays.

Both in terms of trade and population, Penang grew rapidly and soon became the British entrepôt that Light had envisioned. The sultan of Kedah was not particularly happy about the success of Georgetown. He felt the EIC had obtained the port under false pretenses. 

He received a yearly pension, but it was apparent that the British had no intention of protecting Kedah from the Siamese. In 1791, he assembled a force to attack the British.

The British, under Light’s leadership, staged a preemptive strike and destroyed the sultan’s fleet at Prai, directly opposite Penang Island. In order to prevent future incidents and to obtain an area in which to grow food for the island, the British then purchased the district of Prai. They re-named it Province Wellesley. It gave them control of a piece of the mainland facing the island and led to close physical links with Kedah.

Penang never really lived up to Light’s hopes for the colony. Situated at the northern tip of the Straits of Melaka, its strategic value was limited by its distance from the Sunda Straits. Also, it was too far from the sources of much of the straits produce.

Whatever significance Penang had was later eclipsed by the success of Singapore. Penang, however, was a successful model for the future.

Stamford Raffles, the founder of Singapore, was stationed in Penang as an official of the EIC and saw the potential for a similar port that was more strategically located.

It is probably true that without Light’s vision for Penang and the example it set, there would have been no British Singapore.

RAFFLES AND SINGAPORE

Dutch attempts to dislodge the British moved to Europe and to the diplomats. In this arena, the Dutch had considerable support.

Many members of the British government saw Raffles’ actions as a violation of government policy. Within the EIC, there was significant opposition – from Penang, whose officials felt that Singapore was a threat to their future, and from India, which thought it was a costly venture that would drag the company into a profit-draining conflict with the Dutch.

If there had been modern communication at the time, Singapore probably would have been returned to the Dutch.

What saved Singapore was its success. While diplomats, bureaucrats and company officials argued, Singapore’s destiny was already established.

In its first year of existence, British Singapore conducted over $400,000 in trade. In 1821, this increased to $8 million and in 1823 to $13 million.

By 1825, the trade figures for the British ports were Melaka $2.5 million, Penang $8.5 million and Singapore about $22 million. Singapore had become too important a port for Britain to return it to the Dutch.

By 1821, the EIC had changed its tune and favored keeping Singapore. The following year, the British government made it clear to the Dutch that they were there to stay, and it was time to re-negotiate the future of the Dutch and the British in the archipelago.

SINGAPORE’S IMMIGRANT POPULATION

Singapore is a unique Southeast Asian country in that the vast majority of its population is not from Southeast Asia. Nineteenth century Singapore was a society of immigrants and migrants.

Although virtually all the Chinese who came to Singapore were from southern China, the Chinese community of the nineteenth century is probably best characterized as divided and disorderly.

These early Chinese played important roles in Singapore’s early success because of their knowledge of the archipelago and the commercial contacts they had developed in the straits.

The Chinese government opposed the migration of its citizens because it feared that overseas Chinese communities would become hotbeds of anti-government activity.

In addition, in the past, the Chinese had been reluctant to leave China because of strong cultural ties to the family and their ancestors. Ancestor veneration and the ceremonies that went with it were important parts of Chinese culture. To move to another part of the world weakened those ties and was a traumatic experience for many Chinese.

In addition, the Opium War and the Unequal Treaties gave the West virtual control of many southern Chinese ports and thus provided gateways for those who wanted to escape China.

As the Chinese left, a pipeline formed back to their villages and families, ensuring that future migrants would follow their relatives to the new countries.

One factor that divided the migrant Chinese community was dialect. While China has a common written language, it has numerous oral dialects, which are distinctly different from one another.

Each dialect group clung together, forming associations, clan organizations and secret societies. In many cases, centuries-old prejudices and animosities continued in the new land.

Most who came to Singapore as laborers were Hakka; businessmen and shopkeepers generally were Hokkien; artisans tended to be Cantonese; farmers and some shopkeepers were Teochew; and the Hainanese were often servants, waiters and seamen.

FEDERATED MALAY STATES (FMS)

As time went on, it became apparent that separately governed states retarded growth on the peninsula.

These problems led to the call for some kind of centralized governmental control, which would create greater uniformity of law, rein in the power of the individual residents and allow the use of the revenue of the more developed areas to help those that were lagging behind.

What finally emerged was close to Swettenham’s model and became known as the Federated Malay States (FMS). The plan called for the establishment of a federal capital at Kuala Lumpur and the creation of a new position of resident general, who would supervise the residents and coordinate policy for the four states.

The sultans and the British approached the concept of this new government from opposite directions. The sultans saw it as an opportunity to put limits on the powers of their state residents.

Frank Swettenham, who was responsible for selling the idea to the sultans, played this angle to the hilt, although he shared the British view that the new system would actually improve British ability to control the politics and economies of the Malay states.

When the federal council was established in 1909, the sultans soon realized that they had miscalculated. Rather than giving the sultans the opportunity to share a common front, the council further reduced their power and influence.

While dominated by the British, as time went on, it provided a structure for the Malays to participate in the government of Malaya rather than just in the government of their individual states.

The FMS was a model of greater unity, and ultimately it was the model for the establishment of the Federation of Malaya and the nation of Malaysia.

BRUNEI SULTANATE

In the sixteenth century, Brunei was a relatively peaceful place to trade compared to the Straits of Melaka. It was an important distribution center for Indian textiles in the South China Sea and eastern archipelago, a source of jungle produce, such as rattan and bird’s nest for China, and an entrepôt for nutmeg, cloves and pepper from neighboring islands.

Unlike other Muslim states, the sultanate was willing to trade with the Portuguese, as well as other European powers. As a result, it became a regular port of call in the trade between Melaka and Macao.

Brunei’s influence and control stretched into significant portions of what is now the Philippines, and it was a thriving, wealthy city of some twenty to forty thousand people.

Yet in some ways, the Brunei sultanate was quite similar to the Malay entrepôt states of Melaka and Johor. The sultanate’s power came from control of the river mouths along the coast and the allegiance of the leaders of those settlements.

In the sixteenth century, the sultanate prospered and was able to avoid the dislocations that took place in the peninsula after the arrival of the Europeans. Brunei was far away from the fiercely contested straits and was useful enough to all that it was left alone. By the seventeenth century, Brunei’s control over its empire had begun to decline.

One of the reasons for this was the loss of its position as an important trading center. Sulu had diverted much of the spice trade to the southern Philippines as well as claiming suzerainty over the northeastern part of Borneo.

Spain had raided Brunei several times in the sixteenth century, trying to gain a foothold in the northern part of the state. Portugal was brought under Spanish control in 1580, so that Brunei lost its main European trading partner.

SINGAPORE: A GLOBAL TRADER

An often-used assessment of present-day Singapore is that the People’s Action Party government transformed Singapore from a “colonial backwater” into a modern, prosperous global city.

While it is true that the PAP transformed the city, it was certainly not a backwater. British Malaya was of great significance to global economic and political issues during the years between the two world wars.

By the turn of the twentieth century, Singapore was the most important port in Southeast Asia and the seventh largest port in the world.

As the production of raw materials in the area around it grew, Singapore had the geographical advantage as well as a well-developed infrastructure to facilitate the expansion of trade and commerce.

Financial and commercial services were required to make growth possible, and the island was able to provide them. Even though large amounts of capital were raised from outside the area, the need for credit and banking facilities in Malaya boosted Singapore’s financial community significantly.

These developments rapidly established Singapore as an important financial center as well as a thriving port city. It made its living by offering services to trade.

Many companies that owned rubber estates and tin mines were in London and did not have the personnel or expertise necessary to facilitate their production.

As such, many well-established companies in Singapore provided these services. Guthrie, Sime Darby, Boustead and others acted as agents in purchasing supplies and equipment, providing labor and management services and facilitating the shipment of raw materials to the rest of the world.

The rubber plantations that developed in British Malaya in the early twentieth century became directly tied to the fortunes of the American rubber and automobile industry. The ties between the two were so close that it was said: “when America sneezed, Malaya caught a cold.”

Although the Dutch tried to prevent it, much of Indonesia’s raw materials passed through Singapore because of its superior port and trading facilities.

An example was its assumption of a role it plays to this very day as the most important oil bunkering facility in Asia.

The discovery of oil in Borneo, Sumatra, and East Java and the increased use of petroleum products for fuel created the need for a central facility for its storage and ready availability. Singapore became the clearing house for kerosene and, later, other oil products.

The first plant was set up on Pulau Bukom in 1905 by the forerunners of Shell, and it remains one of Shell’s most important facilities 100 years later.

THE RISE OF JAPAN

For some time, the British had recognized that the Japanese represented a potential threat to their interests in Asia. The money and resources spent on the construction of the naval base in Singapore were ample evidence of this. But until the late 1930s, the threat was not seen as especially menacing.

Even if the Japanese controlled China, they were so far away that an attempt to invade Malaya would be apparent well in advance. The Japanese would have to cover 4,023 km (2,500 miles) before they reached Malaya.

German aggression and the outbreak of World War II in Europe turned the British defense strategy on its ear. By 1941, German actions in Europe and the North Atlantic had changed the foundations of British strategy in the East.

More importantly, the administration of Indochina was controlled by Japan because it was an ally of Germany.

The Germans had established a puppet government in France, known as the Vichy government. This pro-German French government ruled Indochina and allowed the Japanese to build air fields and military staging depots in what is now southern Vietnam.

The Japanese were no longer 4,023 km (2,500 miles) away. They were just a flight across the South China Sea.

Fall of Malaya

It is interesting that many of the popular explanations as to the fall of Singapore and Malaya have focused on British mistakes and omissions rather than on Japanese strengths.

It is almost a racist form of denial – that the Japanese would not have won if not for British mishandling of the situation. The Japanese won because they had a well-equipped, highly motivated, well-trained and well-led force.

The Japanese fighter planes were the finest in the skies at this time and had more speed and maneuverability than even the best British plane.

The Japanese troops that hit the beaches in Malaya were seasoned veterans of the China campaign. They were outnumbered two to one, but their experience and deeply held devotion to duty carried them through.

In the end, the question is moot because there was no way the British were going to divert resources to Malaya that were needed to defend the United Kingdom.

The significance of the fall of Singapore goes far beyond the history of Malaysia and Singapore. After World War I, Britain was an empire in decline but not in the eyes of most of the people of Africa and Asia.

Singapore, the greatest base of the greatest empire, had fallen, not to another European power but to an Asian one. The Japanese victory was symbolic in the eyes of millions of Asians as the end of European invincibility.

When the Union Jack came down on February 15, 1942, it was a moment of great historical significance in Malaya.

IMPACT OF THE WAR

Although the people of Malaya were glad to see them return, the British had lost the moral authority to rule.

For almost a hundred and fifty years there had been an aura of British political and military invincibility. The Japanese invasion had ended that perception once and for all.

The British had failed in one of their primary functions as a governing power – to provide peace, order and security. The Japanese had continued to humiliate the British throughout the occupation, and the sight of half-starved British prisoners of war digging ditches and doing other menial tasks further eroded the British imperial image.

Thus there was little doubt that the days of British Malaya were numbered. The war had changed the views of both the Malays and the immigrant races as to what the new political order should be.

For Singapore, the occupation was a significant force in the creation of a Singaporean identity. The Chinese community had stabilized in the 1930s to the point where a majority of the population was born on the island.

For most of these Chinese, the occupation was a common experience that transcended dialect, class and education. They spent three-and-a-half years finding ways to survive in the face of a hostile occupying force.

It is the shared experiences of history that are the building blocks of nationalism, and the most powerful of shared experiences are war, hardship and suffering, all of which were abundant among the Chinese of Singapore.

The Singapore that had been willing to work, prosper and grow under British direction no longer existed. Most of the residents had been born in Singapore. They had survived against terrible odds, and the island would never really be British again. Singapore was their home, and they wanted a say in its future.

BORNEO IN THE TWENTIETH CENTURY

During Vyner’s reign, Sarawak slowly became part of the world export economy. In the nineteenth century, the Borneo Company had been the only foreign business venture allowed to operate in Sarawak.

As World War II and the 100th anniversary of the rule of the Brookes in Sarawak approached, it became clear to Vyner that the days of autocratic rule by white rajahs were coming to an end.

His efforts to modernize the government had been fairly minimal. In 1937, the government’s total revenue was $4 million, hardly enough to run a modern government and economy.

As the world approached the mid-twentieth century, the methods that the Brookes had used to rule Sarawak were outdated. Vyner seemed to realize that Sarawak needed a contemporary and centralized system of government, but his nephew and heir, Anthony, was determined to perpetuate the old system and worked behind the scenes against his uncle’s plans for modernization.

In return for financial support for his family, Vyner agreed to cede Sarawak to the British government. It was to become what James had initially planned, a British colony. There was opposition to Vyner’s decision. Many of the Ibans and Bidayuhs had deep personal loyalties to the Brooke family, and these were not necessarily transferable to an anonymous British government.

The resources available to the new colonial government went far beyond those the Brookes could have mustered. Impressive strides were made to rebuild and expand the economy and infrastructure. Between 1946 and 1955 alone, revenue from the oil industry increased from $51 million to $292 million.

The search for offshore oil was encouraged, and there were important new oil discoveries. New roads and airports added impetus to economic growth, and previously inaccessible areas were brought into the modern economy. New schools and teacher training facilities were built, and education was offered to all ethnic groups.

FEDERATION OF MALAYSIA

The sultan of Brunei had decided against joining Malaysia for financial reasons. In the 1920s and 1930s, large reserves of oil had been discovered in Brunei.

With a population of less than a quarter million people, Brunei’s economic future was bright. If it joined Malaysia, the sultan feared that significant amounts of Brunei’s oil revenue would be diverted to the federal government in Kuala Lumpur in the form of taxes and revenue sharing.

This was too much to give up. It is doubtful whether his son Hassanal Bolkiah, the present sultan of Brunei, would have become one of the world’s richest men today if the country had entered Malaysia.

Joining Malaysia would also have brought about greater democratization of Brunei’s political system since Malaysia was a democracy.

Brunei’s experience in limited democracy had not gone well. The leaders elected by the people had threatened the royal position and power and in 1962 had actually staged a short-lived rebellion. The sultan wanted no further significant participation by the common people in the political decision making process.

Also, the sultan of Brunei was not pleased with his place in the line to be a future king of Malaysia. Brunei was to be the tenth state whose sultan would be eligible to be king of the country, and the sultans of the peninsula had made it clear that Brunei would have to wait its turn.

Not foreseeing the prestige of being king in his lifetime, added to his other concerns, prompted the sultan of Brunei to continue his relationship with Britain as a protectorate rather than join Malaysia. Brunei achieved full independence in 1984.

Regional Opposition to Malaysia

Internationally, the new country faced opposition from Indonesia and the Philippines, which challenged the legitimacy of the creation of Malaysia.

The Philippines opposed the creation of Malaysia on the grounds that the part of British North Borneo east of Marudu Bay belonged to it.

Manila maintained that the sultan of Sulu had merely leased it to Dent and his successors, and thus, because Sulu was part of the modern Philippines, that area belonged to the Philippines.

Negotiations took place between the Tunku and the leaders in Manila to try to solve the dispute, but the issue became a matter of national pride in the Philippines, leaving little room for a compromise.

In the end, Malaysia and the British rejected Filipino claims, and North Borneo became the Malaysian state of Sabah. Politicians in the Philippines played up the perceived slight. Anti-Malaysia demonstrations were held, and the free-wheeling Filipino press trumpeted the injustice.

Decades later, an interesting phenomenon is the rising Filipino influence in Sabah as a result of the hundreds of thousands of illegal Filipino immigrants who have slipped into the state to take advantage of its better economic prospects.

The origins of Indonesia’s objections to Malaysia were more complex and revolved around the political problems and personality of the country’s first leader, President Ahmad Sukarno.

In the early 1960s, Indonesia faced serious problems. All levels of society felt the hardships caused by runaway inflation and shortages of nearly everything from rice to nails.

A foreign scapegoat is a useful tool to distract the minds of the people from the realities at home. Malaysia was a neo-colonial plot, proclaimed Sukarno to the masses. Sabah and Sarawak should be part of an Indonesian Borneo, and Britain was denying Indonesia this opportunity by making them join its puppet, Malaya. Sukarno vowed to “crush Malaysia” and sent troops to fight the new country.

The conflict between Indonesia and Malaysia went on for three years. At times this “Confrontation,” as it was called, was almost comical, but there were real battles with real people dying.

INDEPENDENT SINGAPORE

Singapore’s exit from Malaysia was unique. It is hard to think of an example in history when a state has been expelled from a country.

Singaporeans had to undertake a fundamental reevaluation of who they were, where they were going and what they were going to do to survive.

A new national identity had to be developed. After years of convincing Singaporeans that their national destiny was as partners with the people of the peninsula, they had become citizens of a separate nation. A new economic strategy also had to be formulated.

Singapore had seen itself as the New York of Malaysia, as the commercial and financial center of that country. It now had to look elsewhere for its prosperity and a new role. It was no longer a Chinese state in a Malay nation but a Chinese nation between two Malay nations – Malaysia and Indonesia.

These daunting challenges were compounded by the announcement in 1967 that Britain planned to withdraw its military forces from Singapore by 1972. On the heels of the exit from Malaysia, this was devastating news. The contribution of the British forces to Singapore’s economy was significant – 15 to 20 percent of its national income. The British withdrawal also meant that Singapore would have to build its own military establishment with people who for the most part had no military traditions, experience or national loyalty.

TWENTY-FIRST CENTURY SINGAPORE

When the Asian economic crisis hit in 1997, Singapore survived much better than its neighbors. Its resilience was in part due to its well-regulated and transparent commercial and financial markets and in part because its political stability offered a safe haven in uncertain times.

As Singapore faced the twenty-first century, it became clear that the model that had brought it this far was in need of some serious redesign work. At the core of Singapore’s social contract was an economic determinant.

The problem was that Singapore had moved into a pretty tough economic league. With annual household incomes averaging around US$40,000, Singapore’s competitors had become the developed countries of the world, and survival required a whole new mindset if Singapore was to continue to grow economically.

Singapore’s future growth would have to come from making the present population more productive and expanding the number of skilled workers. While it did this, it had to keep in mind its new competitors.

In this economic league, success was generated by initiating new ideas, products and services, not assembling or implementing the products and services of others.

While Singapore’s leaders had spent considerable time and discussion on how to transform the nation into a knowledge-based economy with its own ideas, innovations and entrepreneurs, the economic crisis of 1997 truly galvanized the nation into action.

FRIENDS AFTER THE DIVORCE?

Among many Singaporeans there is a common narrative that separation saved them from the fate of their immigrant brethren on the peninsula. In the ensuing decades, a belief has grown that the Malays had prospered and advanced on the backs of the immigrant races – that the Malays believed the world owed them a living. Had Singapore remained in Malaysia, they would have paid the price for this attitude.

From a popular Malaysian perspective, the narrative begins with Singapore having to be expelled from the country because its leaders were threats to racial peace and harmony. After independence, Singapore continued to be insensitive in its defense strategy and diplomatic behavior.

Singaporeans are viewed by many Malaysians as arrogant, crass and materialistic. Everything is about winning and money. In relations with Malaysia, everything is precise and businesslike, rather than chatty and neighborly.

When Singaporeans accuse Malaysia of marginalizing the Chinese, Malaysians say Singaporeans marginalize their Malay population. Malaysians are quick to point out their backward educational and economic positions on the island

It would appear that in the public eye, those who have wanted to stress the differences between Malaysia and Singapore have dominated the discussion. In reality, the relationship is one of codependency enmeshed in race and national pride.

Perhaps it is the recognition of this dependency that many times creates hyperbole and resentment.

The popular views blur the realities of how much they have in common. Singapore needs water from Malaysia; 50 to 60 percent is piped in from Johor.

Singapore is trying to develop alternative sources but the costs are much greater. Malaysia is Singapore’s most important trading partner. In 2005 bilateral trade between them came to S$88 billion. About 200,000 Malaysians work in Singapore, both unskilled laborers and professionals, and about 50,000 of these commute daily. They are the most compatible foreign workers in Singapore.

Malaysia benefits immensely from its economic relationship with Singapore. The balance of trade between the two countries in 2004 was in Malaysia’s favor by over S$10 billion.

Over nine million Singapore tourists visit Malaysia every year, spending around RM5 million a day in the closest state of Johor. Singapore is also Malaysia’s largest foreign direct investor.