One Response from the South: Singapore's Efforts at Developing Hub Functions

As Asia becomes increasingly integrated economically, opportunity particularly in managing financial flows, as bases to coordinate regional production networks, and as staging points for the penetration of new markets. The paper argues for a path-dependent logic to understanding the efforts of the Singapore State in hosting hub functions. As a city-state without a national economic hinterland, Singapore's response to increasing business costs and regional competition has been to create a set of policies designed to encourage multinational companies to keep administrative control functions in Singapore while moving the more labour and land intensive production functions to nearby Malaysia and Indonesia. An understanding of the competition among cities in the Asia Pacific for hub functions must also take into account corporate strategy within particular industry dynamics. The second half of the paper provides a number of case studies to show this interplay between corporate strategy, industry dynamic and government policy.