Leadership in a Fragmented World

The world today is unsettled. Geopolitical tensions, economic uncertainty, rapid technological shifts, and widening social divides are reshaping how we live and work. In such times, leadership calls for more than management. It requires the ability to bring people together, to navigate complexity, and to act with purpose. 

This fireside chat featured Mr Philip Yeo, a visionary maverick and former Chairman of the Economic Development Board (EDB), A*STAR and SPRING Singapore. Mr Yeo has been instrumental in shaping modern Singapore, steering its economic rise and nurturing its research and innovation ecosystem. The session was moderated by Prof Jun Yang, Dean of Nanyang Business School, NTU Singapore, where she also holds the President’s Chair in Finance. 

The following is an edited transcript of the Fireside Chat and Q&A segment:

Fireside Chat

Prof Yang: Many of us who are old enough know the story of the four Asian Tigers — Singapore, Hong Kong, South Korea and Taiwan. Since the 1960s, these economies have been among the fastest growing in the world. Singapore is the smallest in area and population, and the poorest in natural resources. Yet against the odds, Singapore has pulled ahead of the other three since 2005.

Today, in GDP per capita, Singapore stands at roughly 1.5 times that of Hong Kong and about 2.5 times that of South Korea and Taiwan. Mr Yeo’s leadership in EDB and A*STAR coincided with this period of growth, and it is fair to say he has played a critical role in shaping Singapore’s development and identity.

So my first question is this: in what respect do you believe Singapore has done right to pull ahead? And what is the one thing you are most proud of?

Mr Yeo: Well, if we compare Singapore with Hong Kong, Taiwan and Korea, they are quite different economies. Of the four, Singapore is the most open in its industries. Unlike Taiwan and Korea, which are dominated by domestic companies, Singapore does not have the population base or resources. Singapore has always invited investors. Our local industries are not strong. Singapore was set up as a trading nation: we buy and sell, import, and export.

So when the government decided to industrialise in 1961 under Dr Goh [Keng Swee], we focused on industrial development because it creates jobs. Unlike Korea and Taiwan, and with Hong Kong being a different case, we invited investors and allowed them to own 100%. We asked them to bring in management, intellectual property and, most importantly, employment.

Over the last 30 years especially, since I joined EDB in 1986 after 15 years in Defence, we have grown very fast. Our main challenge is sustaining that growth. Today, manufacturing accounts for about 20% of our GDP, which is very respectable. Hong Kong’s share is 1%. Korea and Taiwan are close to 25–30%. So despite our limited population, we are still growing.

The key for Singapore is that the government is very focused. Our job is to provide infrastructure, educate our young people, and maintain an open market. That is how we have prospered.

Prof Yang: You have created many engines for Singapore’s growth: disk drives, semiconductors, petrochemicals, and more recently the biomedical sector. You also created what many call the second wind of Singapore’s growth. People often mention Batam, the Wuxi–Singapore Industrial Park and the Bangalore International Tech Park.

If you were to build a bold new project today, anywhere in the world and in any sector, what would you choose and why?

Mr Yeo: Since 2006 or 2007, I have been helping Saudi Arabia, as I have friends in Aramco. I have also been helping Kazakhstan since 2013. Every country is different, so you cannot simply transplant our approach. I work with the Ministry of Industry, Ministry of Petroleum and Ministry of Defence in Saudi Arabia, and with the Kazakh government’s equivalent of EDB and GIC.

The key challenge is political leadership. Second, you need bureaucrats who can execute. Singapore’s success lies in execution. Many countries hire consultants, and even the consultants speak to me, but the issue is not ideas, it is execution. In my generation, we executed.

When I moved to EDB in 1986, I had been doing well in Defence. I was a Permanent Secretary at 32. The economy went down in 1985, and I was sent to EDB on loan. I remained on the Defence payroll until 1999. I focused on industries that could create jobs. I started with disk drives. At that time, a disk drive was a 5.25-inch chunk of metal. Today, everything is solid state.

Then I moved into semiconductors because you need them long before anyone talked about them seriously. Singapore became a major producer, not of the top end, but of everyday-use chips. After that, I looked at refining. Refining alone does not add value, so we moved downstream into petrochemicals and developed Jurong Island at a cost of six to seven billion dollars. This year is its 25th anniversary.

From there, I moved into pharma. We do not produce generics. Every drug we manufacture is proprietary, and most are cancer drugs exported worldwide. In a good year, with fewer tariffs, we export about 25 billion dollars of pharmaceuticals, so we are a major drug centre. But I was not satisfied with just production. I wanted development.

So I created the A*STAR scholarship and sent young people overseas. Today we have trained 1,800 Singaporean PhDs, half men and half women, split into biomedical sciences and engineering. Another 500 are still in training. The path takes about 12 years: three years undergraduate, one-year overlap, five years PhD, and two to three years postdoc. This is not an AI job; it is long-term scientific training.

I also sent about 30 young people to the UK for MBBS–PhD programmes. They graduate with both a medical degree and a PhD. By 35, they are established professionals.

Transferring this model to other countries is not easy. Saudi Arabia and Kazakhstan have asked, but they must find their own solutions and, more importantly, people who can execute. That is the challenge. Many countries have consultants and political leaders keen to diversify from oil and gas, but they lack strong executors. Everywhere, the issue is finding people who can execute.

Prof Yang: There are a few things that make Singapore unique. We are a trusted partner to many countries, very inclusive, open for business, we welcome everyone, and we can execute both in the short and long run. So when you were starting A*STAR in the early 2000s, I remember the question for you was: when would you see any results? How did you answer that?

Mr Yeo: When I started focusing on medical research, it was not about manufacturing. You can start a factory within five to seven years, but research takes about a decade, about twelve years. Many people ask about Nobel Prizes, but a Nobel Prize is not created overnight. Most Nobel Prize winners are in their sixties, seventies or eighties. It is very rare to win one young. The only Nobel Prize winner I know who received it at 36 was David Baltimore, a good friend who has just passed away. Most others are much older.

So Singapore must understand that it takes decades to train scientists. We now have 1,800 PhDs, all Singaporeans, men and women. Whether they will become future scientists, I am not sure. My main concern is whether we can develop new drugs and new treatments, whether in equipment or in medicine, that can help patients.

The most important thing is not just what we do in research, but how we bring that research into hospitals and to patients. When I visit hospitals, some doctors tell me, “Mr Yeo, I am one of your MBBS–PhD scholars.” I know there are more than 3,000 of them now. I see the outcome as long term. Maybe one day, one of my scientists will become Minister for Health.

Prof Yang: Today, many things are happening. We talk about AI and new technologies that change the definition of jobs every day and challenge existing skill sets. We face climate risk, which threatens Singapore’s very existence because we are at sea level, and geopolitical risk, with rising tensions between major powers. All this makes the world more complex and, in many ways, chaotic.

In this unpredictable world, how do countries across Southeast Asia, which face challenges from tariffs to supply chain shifts, cope with these pressures? What strengths do you believe Singapore still has, and what risks should we watch out for in today’s environment?

Mr Yeo: If you read the news every day, you will see that we no longer have a truly globalised economy. The United States is determined to bring manufacturing back. It now has a basic minimum tariff of 10 per cent, with some even higher. For Singapore as a small nation, this means we must look to our neighbours in ASEAN. We have a sizable combined population at different levels of economic growth, and we can work together. In fact, ASEAN already has free trade among its members.

So we must find a way to operate in a world that is no longer fully global. We have also built strong links with Europe, Japan, South America and Africa. Future economic leaders must think about diversification. In the past, we could simply manufacture and export to the United States, Europe and Japan. Now the situation is very different. Every opportunity for us lies in opening new markets.

For us, and for my colleagues in government, the challenge is to send our officers out. In EDB, we now have offices around the world. When I last completed my work with SPRING Singapore and Enterprise Singapore, we had offices in Africa, Latin America and, of course, India. Our political leadership recognises that we live in a very diverse and unpredictable world, not only politically but also in terms of skills and education.

One point I often advocate to colleagues is that Singapore has two very important neighbours. The first is Indonesia, with 270 million people. I believe our young people should learn Bahasa. It makes sense. When I go to Jakarta, they speak Bahasa. I can understand, but not well enough. The second major market is Vietnam, which interestingly is now very English-focused.

In 2005 or 2006, I brought 500 young Vietnamese students to Singapore. I funded their education up to A-levels. They were free to stay or join my scholarship programme. Out of the 500, I selected seven to continue to overseas universities for bachelor’s and PhD training. All seven are now Singaporeans, all MD–PhDs. Of the seven, six are girls and one is a boy. Vietnamese girls are often the stronger students, which I found to be true.

Most Vietnamese students, after A-levels, receive outstanding opportunities. Two in particular come to mind. One entered the International Baccalaureate (IB) programme at St. Joseph's Institution (SJI) and later National University of Singapore (NUS) High School. After scoring perfect A-level results, he received a full scholarship from Harvard and is now doing his PhD. Another received a scholarship from Massachusetts Institute of Technology (MIT) in Computer Science and now works in Silicon Valley. He still visits me and brings me goodies from Vietnam. Even though we funded their education, not all will stay, but the links remain.

Some people ask why we fund foreign students. What we are bringing in is not only talent but also competition, which raises standards. The Vietnamese students study very hard. Monday to Friday they are in school, staying in dormitories. Saturday and Sunday they study again. Perfect scores. Because of Singapore’s size, they are not all going to MIT and Harvard by chance. They achieve it through effort.

For Singapore, we need more talent. Our limit is not ideas; it is people. In my scholarship programme, I attract students from Malaysia, Vietnam, India and China. After their bachelor’s degree, we send them for PhD training. When they complete their PhD, they automatically receive Singapore citizenship. That is the best form of “kidnapping.”

Prof Yang: To some extent, being small and resource-poor forced Singapore to be open, to integrate our neighbours into a larger economic zone, and to absorb talent from outside. In that sense, we turned the disadvantage of being a city-state into a long-term advantage.

Many people who know you say that you often do things in unconventional ways and sometimes pursue what they call “mad ideas”, including reclaiming Jurong Island and even selling the underwater parts of the island to large multinationals.

So I would like to ask: how do you turn those “mad” ideas into action? How do you treat risks and opportunities when converting bold ideas into real execution?

Mr Yeo: To me, the ideas were neither mad nor risky. We simply had no choice. If we relied only on oil refining and importing petroleum from the Middle East to produce petrol or kerosene, there would be very little added value. To move further downstream, we needed two resources.

First, we needed sizeable land. We could not place chemical projects on the main island because they would be too close to housing areas. So we had to find space offshore. Second, we needed enough land to achieve a critical mass. A viable cluster would require three or four crackers. One cracker is about one million tonnes, so we needed land that could support three million tonnes.

The third requirement was talent. When I asked how many chemical engineers we were training, NUS was producing only 48 a year. I said we needed 400. They were very obliging and expanded the pipeline. Interestingly, most of the students who enrolled in chemical engineering, which is one of the hardest disciplines, were girls. They often assumed “chemical engineering” meant chemistry, not thermodynamics and fluid mechanics. That is why most of my staff in the chemical group were women. In electronics, they were mostly men.

Because we trained 400 chemical engineers a year for ten years, we became the fastest-growing chemical engineering base in the region. Our neighbours could not compete, and our brightest students went into the sector.

So the idea was not mad. It was necessary. If we did not go downstream, we would have had no added value. At its peak, Jurong Island employed about 25,000 people. It was not small. Depending on oil prices, our exports from Jurong Island could reach around 100 billion dollars. Most Singaporeans only see hotels and offices; they do not see the industries that are out of sight. Manufacturing is still about 20 per cent of our GDP, and less than 20 per cent of total employment. But manufacturing has powerful multiplier effects. You need logistics, finance and many other services to support it. Services alone do not generate that multiplier.

Singapore had to diversify into different skills. In my generation, we knew what we wanted to do and we got it done. The key was execution. The original target for Jurong Island was 2025, but we completed it early and opened it in 2001. We were far ahead of schedule.

I remember Mr Lee Kuan Yew’s secretary calling me one day to say that Mr Lee wished to visit Jurong Island because he did not know much about it. We arranged a visit, and afterwards he was very happy. He said we should have a plaque listing the people who built it. I said thank you, although we did not do it for recognition.

The key in my generation was execution. The political leadership did not need to wrestle with us. No one second-guessed us. No one asked for lengthy papers. In fact, there was never a formal paper on Jurong Island.

Prof Yang: In Singapore, we often try to strike a balance between having diverse ideas and respecting established norms. You are well known for moving fast and creating new things, and along the way you have broken a few rules and challenged the boundaries of that balance.

So my question is: how can today’s leaders show the same courage while keeping trust and accountability intact?

Mr Yeo: The key is that you break rules not for personal benefit, but for economic growth, for the country, for the people. So as long as you break rules with no personal gain, it is not a crime. That is the key. Rules are necessary, but we should not stick to rules that hold us back.

When we wanted to develop any project, for example, I wanted to build 25 semiconductor wafer fabs, which are very water-intensive. If you ask for 20 wafer fabs, you need lots of water, and we could not supply potable drinking water for that. So I asked my staff in EDB what we should do. We took dirty water, recycled it into NEWater, and most of that NEWater goes to industry because it is pure with no minerals. That is how Singapore was able to build wafer fabs. Today we have only 15, but even 25 would have been too demanding on potable water. Most countries use both.

Here in Singapore, we use recycled water for industry, which is technically drinkable, although nobody wants to drink NEWater. In my generation, we had to break rules and be correct. You are asking for 20 wafer fabs, competing with drinking water, so we cannot agree. We switch and create an alternative.

For Singapore, we need people who think out of the box. Rules are there, but not always necessary. To reclaim 3,000 hectares of land, we had to find sand and companies to help us reclaim. Each phase had to be done in five years. Each phase of Jurong Island, about 900 hectares, was completed in five years.

We were promoting Jurong Island to companies while it was still underwater. So it requires people who have confidence and are willing to get things done, not conform to the idea that we must have the land ready before inviting investors. We promoted investment while it was still under the sea. So we had a joke: the best song for us is “Under the Sea.”

Prof Yang: We need confidence, and we need to think outside the box. I think that is probably a key takeaway from this discussion. I learned that you often warn about complacency, especially for new generations and for leaders in business and in government.

So the challenge is this: what will help leaders keep a large system yet stay fragile? In other words, how can we make sure each generation is creating rather than simply maintaining what is already there? How do you view that?

Mr Yeo: Each generation has to find their own path. But I believe the most important thing is whether each generation has the hunger and drive. My concern is that a generation that is well fed, well educated and under little pressure may lose that drive. That is a worry.

Today, I fund about five students each year from ITE, polytechnics and universities to pursue their projects. They are very keen. So I guess each generation has to find their own dream and their own drive, and I am quite happy that younger people are doing that. They are also lucky. Unlike my generation, they do not worry about supporting their parents; their parents support them. With that support, the younger generation is more willing to try and do their own thing.

But I always tell them this: you must go beyond Singapore. You cannot think of ideas and products only for the Singapore market. There is no market here. Start with ASEAN, then move to other markets. So when young people have an idea, I always ask: where else can you sell this product or service? You cannot focus only on Singapore. That is the key challenge. Young people must be global. That is why I always say they must learn, beyond English, another language. That is very important.

For example, in one of the companies I run, I have factories in Penang with 1,800 workers, in Suzhou with 400 workers, and in Thailand at two locations with 1,000 workers. Now we have factories in Ireland as well. We have young people who want to be posted overseas. I do not want them to stay at home comfortably. The more international we become, the more I want my young people to go everywhere.

Prof Yang: We thank you for your investment in talent. You mentioned one initiative you started called EDIS Cares, where you support young kids. Could you share with us about EDIS Cares?

Mr Yeo: Not many people are aware of EDIS Cares. I found out that in Singapore there are people living in one-bedroom HDB flats, and they usually have financial difficulties. So this is an arrangement we have to help the education of these young people, from infant stage all the way to Primary Six, because I believe that if a child can cross Primary Six and have a good education, their chances improve greatly.

EDIS Cares takes care of about 300 young kids from broken families, and that is what we have managed to do. In fact, the whole purpose of my book was not for my own biography. My staff asked me, “We want to raise money for EDIS Cares, can we write about you?” And I said, “Okay, you can do anything you like so long as we help raise money.” Because of the book launch in 2016, we raised 750,000 dollars from donations. After the first 5,000 copies, SPH made a lot of money selling the rest, but we are continuing with this charity.

This charity is not just about providing money. We find a mentor for each child from Primary One to Primary Six, and the mentor and mentee must volunteer to spend at least a year together every weekend. Most of the volunteers are young people, and on weekends they spend time with the boys and girls to help them with English and Maths, the two very important subjects.

When these young people pass Primary Six and go to secondary school, we are happy that they succeeded, because most of them come from broken homes. The father could be a drug addict, the parents may be divorced, or the father may be in prison. Many of these kids are brought up by grandmothers, and it is a challenge because there is not much financial help. The key is to find a mentor for each child.

I am very pleased that many of the mentors are young school students, secondary school kids willing to volunteer. Each mentor takes one child for at least one year, renewable. It is very labour-intensive, so we keep the number to 300.

The staff are on my payroll. I raise the money for their use, and the money is managed by Community Chest. Every year I sit down with five volunteer organisations and ask how we can help their members. These groups include those working with families of prisoners and broken homes. But the key is always finding mentors who can help these children in their education. I hope they can help each child cross Primary Six, and from there the future is open.

Prof Yang: Investing in people is probably the most profitable investment in the world. I know you have talked about your bosses, and you have mentioned Dr Goh on many occasions. Do you remember any difficult moment with any of your bosses in your career?

Mr Yeo: By 1988, we had full employment. We had a problem because we had enough workers here, and companies wanted to import more workers. So I came up with ideas. How do I move parts of my production chain offshore? Should I move them to Johor? Should I move them to Indonesia? Obviously Johor was easier, but there was not much facilitation for transportation.

So when Dr Goh came to see me around March 1989, he asked, how about looking at Batam? I said I had never been to Batam, so let me have a look. I went to Batam. Infrastructure was there, the airport was there. So I said I wanted a location in the central island near the reservoir. The reservoir was there, about 500 hectares. So I said, what can I do?

We would produce the components in Singapore – electronics, Thomson Electric. We would produce the components here because manufacturing is capital-intensive, but you still need assembly and testing. You cannot replace the final phases. So we moved the final assembly offshore. We produced the parts in Singapore, put them into a sealed container, transported the container to Batam Industrial Park, did the final assembly there, sealed it again and exported it back to Singapore. It did not enter the Indonesian market.

When I proposed this idea, I needed agreement from the government. So I went to see my boss, Dr Goh, who was then Chairman, and I said I had this idea to move some of the production offshore because I could not get more labour, and I wanted to move to Batam.

I brought him to visit. He said it was a crazy idea with a lot of transportation problems. I showed him the island and said this was my plan, to build an industrial park for factories. He asked what I was going to do. I said I would start work tomorrow. He said no, you cannot do that. You need a government-to-government agreement. I looked at him. He looked at me. He knew I would not write it. He wrote down the note. After that he handed it to me and said, “This is my draft for you, can you check?” He took the draft written by him to Mr Lee Kuan Yew. Mr Lee flew to Brunei, met President Suharto, and agreed. So you need to find bosses who do the work for you.

After I started construction and built very fast, in two years there were about 100,000 workers. Then I realised that if I wanted to raise funding for Indonesia, because the land was Indonesian, Singapore banks would not loan Singapore dollars. I needed to raise Singapore dollars for financing the project, but Indonesia would not allow it because Singapore does not allow the export of Singapore dollars.

So I went to see Dr Goh. He said, write to me. I looked at him. He took a note, wrote it down and said, “This is what you write to me.” So I got my secretary to type three of the same letters, same format, for 600 million dollars. So you need to find a boss who will write for you.

Prof Yang: You have mentioned multiple times that you never wanted to be a civil servant. If you think really creatively, what might you have ended up doing if you had not worked as a civil servant? What would your work have been like?

Mr Yeo: First and foremost, I went on a scholarship, so I was bonded. Singaporeans were bonded for five years. I worked in Defence at the age of 24. By the time I finished my fourth year, I was Director of Finance, the fastest promoted by Dr Goh, at the age of 26. I had a Mercedes-Benz given to me. I was the youngest director. My counterpart was Mr Nathan; S R Nathan was 20 years my senior. So I had a good boss.

In a sense, I could have stayed, and I could have quit. My original idea was to finish my bond and leave, and move into the business world, because I would have preferred business. But what happened was this: I went to Harvard on a US Fulbright Scholarship, not funded by the government, and I thought I would be free. They said no, we want you back. Vietnam had fallen in 1975, and we knew very quickly what needed to be done.

If I had not had Dr Goh, I would have left the government long ago. That is a fact. So, in a sense, a good boss is not someone who kidnaps people or forces them to stay. If you have a lousy boss, I always tell myself, you cannot choose your parents, but you can choose your boss.

Q&A Segment

Audience Member 1: What factors do you believe will shape Singapore’s future?

Mr Yeo: When people ask me about the future of Singapore, I’ll say it's not my problem. I said it jokingly because it's hard to see forward. It really depends on the present leadership. What I have done is history. What you need is a new generation.

Today, there is greater focus on intellectual property, so it's quite a different thing. But I always tell young people: you need to have a good education that allows you to pursue a broad field. That's very important because industries will change.

For example, when we talk about AI, AI is basically software, but you still need to make products. AI doesn't make a car. AI doesn't make a phone. You use AI as software. You need young people who are willing to learn hardware and software. The key is to have a good education.

Ideally, I like young people to have an education where they have a combination of sciences and humanities, so that they are able to think, write, and communicate. For any leadership, the education of young people is the most important factor. And that's why Singapore succeeded. We are able to educate, and we are able to finance the education of young people. So our future really depends on that.

If we want to grow in our ASEAN neighbourhood, we should try to invite young ASEAN students to come and study in Singapore. They may not all stay, but what percentage will stay? And those who go back will bring memories of their stay in Singapore. When we want to go into ventures, it's always good to find a student who has studied in Singapore. That's very important.

I give an example: the Deputy Minister for Science and Technology in Indonesia — a lady. She's an Indonesian lady. She came to Singapore, received an ASEAN scholarship, and went to America to do a bachelor’s and a PhD in neuroscience. She was then taken back into Tsinghua University. And last year, she returned to Indonesia as the Deputy Minister of Science. She's still a Singaporean, so I communicate with her. I ask her, “So, do you miss Singapore food?”

So the key is that if you are able to accept talent from our neighbours, and be generous enough to give them scholarships here, not just to our own population, we really can grow. Whether it's Vietnamese students or Indonesian students, we have a lot.

Singaporeans must have a big enough heart to take in new students from our region, to add to our population, because our population is not increasing, and we grow a stronger Singapore. Political leadership must be able to tell the people that we need to bring in talent to grow our economy.

Audience Member 2: How can we ensure that our current civil service, where execution is so important, continues to have the love of the country, even as people become less willing to break the rules and push the boundaries?

Mr Yeo: Well, it depends on leadership. When I was Chairman, our job was to help companies grow, whether international or local. You cannot blame the officers on the ground; everything is driven from the top.

For example, in 1987 I set up EDBI in San Francisco and gave my staff 40 million dollars to invest. My rule was simple: write down every one million dollar investment to ten per cent, because 90 per cent of projects will fail. If you plan for failure, you do not blame people. Many projects succeeded because of that mindset. Today, everything is calculated: if I put in one dollar, can I get back two? Leadership sets the pace.

When I wanted to recruit a senior oncologist from the National Cancer Institute in 2000, he asked whether he could have his own building. I said yes, and that led to Biopolis. I had no budget and no land. JTC owned the land, so I asked them to build a two-million-square-foot complex designed by Zaha Hadid, and I would pay rent. There was no government paper or budget approval; we just built it.

It was the same with Fusionopolis. We broke ground in 2003 and even built a new MRT station without formal budget approval, later handing it to LTA. We placed public and commercial labs together so the development was viable.

The leader sets the pace. If the leader is bureaucratic, everyone becomes bureaucratic. If the leader is willing to break rules responsibly to get things done, the system moves. So I have no simple solution.

Audience Member 3: What must Singapore do to continue growing beyond its borders?

Mr Yeo: I’ve been to Dubai Maritime, and they also sought my advice. What we have here is a population. We have to take care of people. Dubai’s population is 90% foreigners. It is a difference. So in a sense, we educate our people. Dubai does not educate these foreigners.

I go to Saudi Arabia. Saudi Arabia has 8 million foreign workers, about 90%. They have no choice. In Singapore, we have our people. But our people must not think that they must remain in Singapore. They must really get out.

So the key for the young generation and political leaders is that we must always think big. We cannot look at Singapore and think that is where we are. We have to make friends with our neighbours, politically and economically, and link ourselves to them. So your leadership must see themselves as big-hearted, with big eyes, and able to grow beyond. The key for the present leadership is that they must learn to grow outside. And that is, politically, up to them to convince the people.

Audience Member 4: Chemical engineering is no longer the most competitive. It is actually the easiest faculty to get into now, because fewer people are interested in becoming chemical engineers. And with all the MNCs that have retreated or downsized in Singapore, do you think the future is still in oil and petrochemicals, or should those lands be developed into something else?

Mr Yeo: Well, the petrochemical companies face an environmental issue. In Singapore, we are not in basic chemicals; we are in downstream chemicals, and that is still a growing area. Next week, we are also marking the 25th anniversary of Jurong Island. They are working out how to redevelop the area, using the same skills to produce pharmaceuticals.

Most of the chemical engineers have now gone into pharmaceutical. Petrochemicals are still present, but the largest industries are in the pharmaceutical sector. So the outlook is still positive. The two most difficult disciplines in engineering are chemical engineering and electronics. These remain the most demanding fields, and you can still move into other areas with these backgrounds.

In fact, many of the scholars are chemical engineers, and chemical companies are widespread. Even one of my engineers is now running a German company in Dow Chemical.

When Mr Zhu Rongji was prime minister, he had previously been the mayor. I knew him as the mayor of Shanghai in 1989, and he later became a minister and then prime minister. We used to meet and talk. There are two industries China should pay attention to: chemicals and semiconductors. Today, I was invited to look at an island developed as the equivalent of Jurong Island for them. Unfortunately, I said I was quite busy. So what China has done today is the same, building a self-sufficient chemical industry with crackers, refineries, and semiconductors. In fact, they should have listened to me earlier.

Audience Member 5: When you look back at all these years of making significant contributions, what is the point? Why do you do it, and how would you do it differently?

Mr Yeo: Well, to be fair, I have been doing many things differently all the time, so I am not too sure how. The one area where I felt we could have gone further was expanding beyond Singapore as far as we could. The moment I stepped out of EDB, after Easter in 2006 or 2007, we stopped going global. All the industrial parks we have today are legacies of my time and my contribution. So my greatest regret is that no one continued the same expansionist attitude. Most people are quite comfortable being here, and that is a worry.

Audience Member 6: Singapore is well known for its meritocratic system. However, based on what you have just described, the definition of talent still remains quite narrow. Yet success can come from different pathways, especially for entrepreneurs. Many of them may not be the top academic achievers. So, if the same system remains in place, how can Singapore better identify and nurture entrepreneurial talent to take our economy to the next level?

Mr Yeo: Do not confuse education, academic excellence and entrepreneurship. Let me give an example. Yesterday at about 3pm, an American neurosurgeon came to see me. He had asked earlier, but I was busy and postponed, so we finally met yesterday. In 2006, he said, he was a professor at Stanford, a neurosurgeon, and was considering his next step. I was trying to recruit him then. He was around 50 or 52. He eventually left Stanford and joined the largest American company making proton beam equipment.

He is now 71. For the last five years he has served in his own company. He is still a professor of neuroscience and the university allows him to take leave to run his company. He is now selling a new proton beam system, equivalent to gamma equipment. He has set up one in Munich and is trying to sell more at age 71. He is very well educated and very bright. I tried to recruit him years ago.

The key is that society allows this. At Stanford, he can take five years’ leave, run a company, hand it over, then return while keeping his academic link. We must allow people to move in and out like that.

When I was Chairman of EDB, some young scholars told me after five or six years that they wanted to join the private sector. I said yes, because it gives them a different view of the world, and they could always return. We should encourage the flow between public and private sectors. Otherwise, there is no mixing of talent.

In America, academics can take five or six years’ leave, start a company, then return. We have not developed that in Singapore. We are quite strict; academics cannot easily move out. China has many bright young people who leave academia and start companies. But most of them fail first. Even this professor had six years of failure in his first company, and I had to help him raise money. Eventually he succeeded. He is now 71 and has set up 30 of these systems in different countries. He came to ask me for advice on setting one up in Singapore. I tried to recruit him in 2006, and now he wants my help.

So the key is allowing our talent to be loaned out. Singapore is strict — if you are a civil servant, you remain a civil servant. In my generation, I was both a civil servant and not a civil servant. I handled government work and also ran companies, but with only one salary: my government pay.

Once you insist a civil servant can only do civil service, you close opportunities. When I ran companies as a young civil servant, I saw a different world — borrowing money from banks, hiring and firing, buying equipment, dealing with unions. You do not get that experience in government.

This ability to be multifunctional is how we develop people. My generation was lucky; we had many roles but no conflicts of interest. I had one salary but the freedom to run five or six companies while still in Defence, EDB, Sembawang or Capita. Someone once asked if I was the highest paid civil servant. I said no — all these roles were pro bono.

Audience Member 7: How would you encourage people to ask more questions about how they can break the rules or change the system, rather than ask questions like how the system can change for them?

Mr Yeo: I do not think you should ask people to change. You must want to change yourself. It is self-driven. When I was in Defence or the Economic Development Board, a lot of the initiatives I took were on my own initiative. You do not expect someone to tell you that you are free to change things. Ultimately, you must want to do something, and you must also take responsibility. We fail, and most people do not want to act because they are afraid of being responsible for failure.

So the key is that there is no restriction on what you want to do. But I have also found that, for example, when I support some other companies, many of the people who are hungrier are polytechnic graduates, because there is a gap between the pay of polytechnic and university graduates, and they are more willing to set up companies. So many of the SMEs in Singapore that I am familiar with are actually started by polytechnic people.

So maybe sometimes you have to recognise that you have become too risk averse. Ignorance is bliss. That is the worry. The more educated people are, the more they analyse, or they generate ten options. When I do a project, I simply say yes, I go, or I do not do it. I do not do any analysis. In everything I do, I expect failure, but I must be prepared to change quickly and change direction. If I try to analyse too much, nothing will be done.

The difficulty is that the more educated a person is, the more they see all the alternatives and all the possibilities of failure. That is the biggest challenge. The more educated people are, the more risk-averse they become. So maybe you are right.

I think that is probably what we can learn right now. Maybe our risk tolerance is epsilon. Can we change that, even jokingly, to ten epsilon? Would that make any difference? The risk tolerance level is, in general, quite low right now. If we can tolerate a little more risk, we can encourage trial and error, so the young generation can learn and grow faster.

Well, we should get our students to go to the region to find new markets, to learn and to make friends. Staying at home is very comfortable. So the key is that we should send our students as far as we can. Then they will learn how to appreciate the talent of other people.

- End of Session -

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