Here’s a very intelligent article on Singapore’s recent history and possible future. It looks at how Singapore rose to be a regional giant, how it then lost much of its lustre under the great shadow of China, and how in the wake of this it is now reshaping itself to once again attain its place in the sun.

In some ways, Singapore’s demise was beyond its control and inevitable:

Truth is, nothing that Singapore did was ill conceived, just that rest of Asia has caught up with them. Today global companies wanting to set up in Asia ex-Japan, be it a representative, sales or manufacturing entity, has a choice. It could be Malaysia, Thailand, Indonesia (maybe) or Singapore in South East Asia or Hong Kong, Taiwan, Korea and the inevitable China in North Asia. They all now offer an acceptable set of infrastructure and a reasonable enabling environment, which for many years was almost a monopoly of Singapore.

When cost becomes an overriding consideration, China wins hands down. China is responsible, for hollowing out a large proportion of existing manufacturing operations of global companies from other Asian countries. The shift of manufacturing from Singapore to China has been relentless and is partly responsible for the current high unemployment and low growth. But all is not lost. When it comes to a decision of spreading the risk that is not putting all your eggs in one basket, in this case China, Singapore features well.

Despite huge advances in China, it still remains unpredictable, multinationals prefer to cover this risk by considering stable Singapore as a regional headquarter or sometime even establish a manufacturing unit irrespective of its high cost base. High productivity also favours Singapore compared to China. Notwithstanding, Singapore has suffered badly from the advent of China as a global manufacturing base.

The one point I have to disagree with, very sadly, is Singapore’s lingering appeal as a regional headquarters. That was true some years ago, when the SE Asian “tigers” were still hot and it looked like Malaysia would arise as the great high-tech manufacturing hub.

Now, I am afraid that Hong Kong is a smarter choice for the Western firm seeking entree to China. Just look at a map and you’ll see why. And, sadly for both HK and Singapore, many of these Western firms are simply skipping the traditional “stepping stone” and setting up headquarters right in Shanghai.

Meanwhile, Singapore is now in a frenzy to position itself as a regional hub for all kinds of industries. From biotech to semiconductors to nanotechnology, Singapore is claiming this is where it is all happening:

Singapore has accepted that it can no longer be a serious contender for manufacturing. It now wants to be a knowledge based society. So at the high end they are building infrastructure and an enabling environment for creating a hub for research and design. Biotech and Infocom are a major focus.

As before, the state is providing the initial impetus by investing in physical infrastructure and seeding some of these projects. Multinationals have gradually begun to follow in its footsteps. Business cost has been reduced, through tax breaks, reduction in mandatory pension contributions and depressed market condition has also seen to a fall in office rentals.

It sounds good, but I can safely say that so far there has been little measurable response.

It is an eerie time in Singapore, a time of anxiety and confusion. We all hear the government’s grandiose intentions, the talk of turning the city-state into “a hub,” but there have been no results. Obviously that will take time, but they’ve been at it now for years.

The article ends on a note of cautious optimism based on the government’s efforts to encourage entrepreneurship and to get out of the people’s way. But many in Singapore right now are worried as the comforts and security they had taken for granted are being whittled away. As in every other country in the region, many businesses are turning to China, hoping that some of its prosperity will rub off on them.

That’s definitely a gamble, but what’s the choice? With every other economy flat, where else is there to turn? As some may know, I’m a bit pessimistic about this strategy, at least in the long term, but I completely understand it. Let’s hope it keeps Singapore afloat, at least until the country gets back on its feet and actually becomes the hub city the government wants it to be.

This is going to be a difficult and painful transition, but at the moment it seems to be Singapore’s only hope.

An article in today’s New York Times points out that credit agencies fear China’s government-owned banks may require a major bailout thanks to overdue loans.

Responding to hints in recent weeks from senior Chinese financial regulators that another bailout of the country’s biggest banks might be needed, two credit rating agencies issued separate reports on Wednesday suggesting that China’s previous efforts had not solved the banking system’s troubles.

The ratings agencies, Standard & Poor’s and Moody’s Investors Service, said that the banks’ troubles had not been resolved by an attempt in 1999 and early 2000 to shift $170 billion in nonperforming loans into asset management companies. The companies resemble the Resolution Trust Corporation that the United States used successfully to dispose of bad loans after the collapse of much of the American savings and loan industry in the late 1980’s.

Gordon Chang, author of The Coming Collapse of China, always maintained that China’s banks are hopelessly insolvent and would prove to be China’s Achilles heel. Things still look okay, but if the slowdown feared by so many materializes, a serious problem, starting with the banks, could escalate into a catastrophe.

I’m not trying to be an alarmist, spreading hysteria about China’s imminent collapse. (It may not be imminent at all.) It’s just that China’s banks seem to be an elephant in the corner of the room that everyone wants to ignore. It’s a big elephant.

[Update, 7:35 am Nov. 7.]

Phil has revamped his site and it not only looks good, it no longer takes all day to load! Also new is a prominent photo of the chicken beater, taken with an eerie chiaroscuro effect that makes him look a bit like a blood relative of Dr. Evil.

The Public Relations Society of America has an article out on how to pitch bloggers. This was inevitable, and it’ll get worse, at least for the superbloggers; as soon as you have people reaching millions of other people with words, you get PR people trying to vie for some of that “mindshare.”

The same article also mentions that UC Berkeley’s journalism school will be offering a graduate course on blogs. A graduate course? Like there is that much to study and learn about writing a frggin’ blog?? I would love to see the curriculum for this class, which could only be offered at Berkeley.

Morgan Stanley has issued a dark, somber (yet sober) warning about the latest fear in Asia, i.e., the overheating of the Chinese economy and the disaster that could follow in its wake.

This topic is everywhere, including the front covers of Fortune and Business Week. And yet it seems no one is taking any notice.

This is urgent; it could affect the lives of all of us living and working in Asia, where so many stars have been hitched to the so-called unstoppable engine of the Chinese economic miracle. Morgan Stanley economist Stephen Roach writes, in near-apocalyptic language:

Asia is not prepared for a China-led slowdown, in my view. Midway through this two-week Asian tour, I am struck by a growing sense of complacency in the region. Memories are amazingly short these days. A seven-month run in the stock market did the trick, I guess. Not unlike the case in post-bubble America, the post-crisis Asian economy seems to have all but wiped out the painful lessons of five years ago. I spent a few days over this past weekend at the Boao Forum for Asia in Hainan, China — a relatively new pan-regional celebration of the Asian miracle modeled after the World Economic Forum in Davos. Heads of state and policy makers spoke eloquently and predictably of the new potential for pan-regional integration and resilience. But the real message, in my view, was the widespread acceptance of an unmistakably Chinese-centric character to the region’s growth dynamic. To some extent this is the inevitable outgrowth of the Asian crisis of 1997-98 — a region that has subsequently turned inward after having been burned by the hot-money capital flows from the West. There was a real sense of self-congratulations in the air in the halls of Boao. China’s spectacular performance over the past five years has given the rest of the region great confidence in the payback from such a strategy.

But there are no guarantees that this latest incarnation of the Asian model will perform any better over time than earlier growth strategies. If the slowdown in the Chinese economy materializes as we suspect, the rest of Asia will have to face the consequences of its new strain of dependency. And that could well unmask many of the region’s lingering structural deficiencies — namely, shaky financial systems and inefficient corporate sectors. Reluctant to embark on the heavy lifting of post-crisis restructuring, Asia thought it had found in China a new recipe for prosperity. As China now slows, my sense is that the region doesn’t have a clue as to what’s coming.

Wow. I’d have to agree; virtually all of the companies I meet tell me how their plans for revitalization and growth are based on those mythical 1.2 billion Chinese consumers, the Holy Grail of world trade. If that engine sputters, a lot of plans and hopes will be dashed.

Link via T-Salon — thanks!

Chinese health officials have declared the month of November to be AIDS Awareness Month, and they’ll be stepping up AIDS education accordingly.

It’s certainly about time. After years of ignoring this issue, it’s nice to see they are doing something, anything, to address this nightmare. All I can say is they have a long way to go. Let’s hope this announcememnt really means something, and that they continue the momentum.

Today the Christian Science Monitor profiles Liu Di, the Chinese “cyber-dissident,” and in so doing smashes the myth — the lie — that the CCP is slowly but steadily increasing press freedoms.

Things are getting worse, not better. The reporter notes how publications that for a moment gave us hope that things were really changing, have been pressured and threatened into silence.

“People talk about changes in the Chinese media,” says a Beijing-based media expert. “But it goes up and down. All political news still goes through the state. When it comes to important questions, there isn’t any independent media.”

Liu Di sounds like one brave lady. I have boundless admiration for heroes like this who are willing to say what they believe, letting the cards fall where they may. And in China, we all know where the cards are going to fall:

A third-year psychology student at Beijing Normal University, Ms. Liu formed an artists club, wrote absurdist essays in the style of dissident Eastern-bloc writers of the 1970s, and ran a popular web-posting site. Admirers cite her originality and humor: In one essay Liu ironically suggests all club members go to the streets to sell Marxist literature and preach Lenin’s theory, like “real Communists.” In another, she suggests everyone tell no lies for 24 hours. In a series of “confessions” she says that China’s repressive national-security laws are not good for the security of the nation.

If that doesn’t merit a decade in a Chinese prison, what does?

From my own experience in China, where all I did was work with the media, I know that there are pockets of press freedom, and some editors still push the envelope. But this is more likely to occur in smaller, more “vertical” publications — those with a relatively small readership in a specific niche industry. These publications are far less likely to be read by government censors (and even if they are, their sphere of influence is so small they may escape censorship).

These are drops in the ocean. In its last paragraphs, the article acknowledge the crumbs of anecdotal evidence of “improvement” (very small crumbs) but its conclusions are unequivocal:

But these are exceptions. The rest – labor activists, upstart college students, journalists, writers, intellectuals, professors, dissidents, religious believers with too much spunk, those who stand out in a too-public fashion or attract too much attention – are warned, or arrested. In this reading of China, free expression is not improving in the short- and midterm.

Despite some changes of style, more arrests are taking place, and ordinary Chinese are still strictly censoring themselves.

I’ll say it again: Reform is as reform does. Anyone who wants to believe the spoon-fed CCP mantra that China’s press is becoming freer is entitled to do so. But the evidence doesn’t back up such lofty phrases; just ask the “cyber-dissidents” sitting alone in Chinese jail cells this very moment.

Be sure to check out Josh Marshall’s great article on the Republican’s insistence that they never portrayed Iraq as an “imminent threat.” Sample:

It’s true that administration officials avoided the phrase “imminent threat.” But in making their argument, Sullivan and others are relying on a crafty verbal dodge — sort of like “I didn’t accuse you of eating the cake. All I said was that you sliced it up and put it in your mouth.”

He gives examples aplenty of the Bushies strongly implying that there was an imminent threat, even if they didn’t use those exact two words.

Here’s another site that gets it right on China and its knee-jerk paranoia when it comes to human rights and religious freedom. How did I miss it for so long?

Its descriptor:

News from China and bordering countries of N. Korea, Bhutan, Burma, Vietnam, Laos, Pakistan, Kazakhstan, Afghanistan, Tajikistan, Uzbekistan, Kyrgyzstan, Nepal, and Mongolia. The focus is on human rights and the persecuted church.

Well worth a visit.

Interesting post from Josh Marshall on how President Bush said in a recent speech:

“We see a China that is stable and prosperous, a nation that respects the peace of its neighbors and works to secure the freedom of its own people.”

That’s how the original transcript reads. (Well, if that’s how he really sees China, what can I say?)

But then, the speech turned up on the White House Web site with the second word changed from “see” to “seek“! That’s a whole different statement, and I suspect the less-than-honest change was made to appease Bush’s far-right donors who still cling to the notion that China is ruled by a brutal dictatorship that abuses its citizens, sneers at the concept of human rights, has dangerous and self-serving ulterior motives and can never be trusted.

Hey, wait a minute….