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SINGAPORE’S DEVELOPMENT POLICIES 395

development investments. For example, in acquisitions were almost totally absent in
addition to its manufacturing plant in Tuas, Singapore but significant in Asian countries
GlaxoSmithKline (GSK) has invested US$70m such as China and India. Hence, this some-
in a R&D facility within the same compound what ‘tacit’ division of labour has benefited
(Singapore Straits Times, 5 November 2005). Singapore, as far as FDI competition is con-
This would be GSK’s sixth R&D plant, after cerned. Coupled with the Singapore govern-
two in UK, and one each in USA, Italy and ment’s provision of high quality infrastructure
Ireland. Novartis AG set up a R&D facility to and the growing pool of qualified human
develop drugs for tropical diseases, such as resources, Singapore has been able to
dengue fever and tuberculosis (Singapore re-capture the ‘competitive advantage’, at
Investment News, August 2004). The other two least for the time being. Some critics (mostly
high profile pharmaceutical R&D projects political lobby groups in the West) offer an
include operations by Eli Lilly, known as the alternative explanation for the flow of
‘Lilly Systems Biology 2’ Centre, and biotechnology and pharmaceutical FDI to
Schering-Plough’s biochemical R&D facility, Singapore. They claim that Singapore has an
located at the University Science Park. extremely ‘liberal’ bioethics policy even with
It would be a mistake to attribute the large the bioethics guidelines. Hence, their argu-
inflow of pharmaceutical FDI into Singapore ment is that Singapore’s high level of phar-
solely to the government’s Biomedical maceutical FDI was due to its competitive
Sciences Initiative. There were also other advantage in lesser ‘morality’. In other
exogenous factors that allowed Singapore to words, scientists and companies involved in
enjoy ‘differential advantages’. For example, stem cell research that is banned in the ‘first
the biotechnology policies of the two largest world’ have since flowed to Singapore (see,
countries in Asia, China and India, had a sig- for example, reports in Far Eastern
nificantly different focus. For both of these Economic Review 2003; Businessweek
countries, the focus was on developing (Online) 2005). In response to these criti-
domestic biotechnology and pharmaceutical cisms, it is worth noting that there are places
firms. Hence, the aim in attracting FDI was which have even less ‘morality’ than
to encourage large biotechnology and phar- Singapore as far as bioethics is concerned.
maceutical corporations to establish joint Yet, there does not seem to be any regular
ventures with domestic firms with the aim of flow of pharmaceutical or biotechnology for-
acquiring capital and technology. The for- eign investments there. Hence, it is more
eign investors, in exchange, sought access to likely that pharmaceutical FDI has come to
these (potentially) huge consumer markets. Singapore because of the state-‘created’
The situation was very much the same in competitive advantages, as well as the cur-
Taiwan and to a lesser degree in South Korea, rent structure of the Asian regional economy.
because the latter country was not particu- Given that the Singapore government had
larly keen on FDI in the first place. Other once gained and then subsequently lost its
Asian countries, such as Malaysia and ‘competitive advantage’, and also given the
Thailand, also have biotechnology policies, nature of economic globalization, the
but they are in the ‘infancy’ stage. Japan is Singapore government would be foolish to
excluded from the analysis, as it is consid- assume that pharmaceutical FDI would
ered one of the ‘first world’ economies, always flow into Singapore. When other
where FDI emanates rather than arrives. states decide to pursue a similar policy
As such, up to the beginning of 2006, agenda, and begin taking action to put in
pharmaceutical FDI in both production and place measures that will be attractive to large
R&D within Asia were mainly concentrated pharmaceutical corporations, Singapore will
in Singapore, but there was very little else- face competition that it did not face between
where. Pharmaceutical FDI in mergers and 2000 and 2005.