Sunday, 23 December 2012

Singaporeans: please get a hobby and be happy!

Singaporeans are the unhappiest people on earth. True? Maybe, maybe not. Singaporeans are amongst the wealthiest humans living on our planet. True? Absolutely.

Measured by per capita income, Panama, the happiest country on the planet, is the 90th wealthiest country in the world. Using the same measure of wealth, Singapore ranks at number five. 

Singaporeans lead 'First World' livesSingaporeans travel the world, waste food, contribute to global warming, worry about things like the welfare of animals and indulge in all sorts of other behavior only available to people with lots of money.

Few will argue humans should live in abject poverty to pursue happiness. However, it does not necessarily follow that greater prosperity equals greater happiness.

But the bottom line is Singaporeans are wealthy. So why are the super wealthy residents of this super-efficient city-state so unhappy with life? It doesn't make any sense. Or does it?

At this point, I will step into some murky waters. Many of my comments below are based on anecdotal evidence and personal observations during my (almost) fifteen years of life on the Little Red Dot. (Hey, it's my blog and I am entitled to opinions.)

Let's talk about hobbies.  

Wikipedia, the source of all modern knowledge, defines hobby as "a regular activity or interest that is undertaken for pleasure, typically done during one's leisure time. Examples of hobbies include collecting, creative and artistic pursuits, making, tinkering, sports and adult education."

Leisure time – what's that? Does the concept exist in our super efficient 'kiasu' society? (We all know what 'kiasu' means, right?)

Singaporeans have little or no spare time. Or at least make little or no free time ('me time') from their otherwise busy lives. It's simply not possible to have any interests outside of work unless one has time.

Time requires the semblance of a 'work-life' balance. Such a balance requires Singaporeans to demonstrate strength of character. 

Character – huh? What does an individual's character have to do with 'work-life' balance? Well, as long as we chase the current equivalent of the 'Five C's' as the Holy Grail of existence there will be no balance in our lives. If our self-worth depends upon owning the latest electronic gadget, Louis Vitton handbag or other material possession then having to run faster and faster on the treadmill is inevitable. Splurging beyond one's means on big ticket items like cars and condominiums mean debt related stress permeating our entire life – and keeping us unhappy?

Make some time and get a hobby. Do something other than chase the dollar.

A hobby does not have to be expensive. It can be as simple as reading (borrow books from Singapore's great library system). Or spend some quiet moments in a green space every so often.

Surely, the pursuit of wealth is a legitimate life goal. Yet, becoming obsessive about materialism and allowing social pressures to dictate our wants is often a sure path to misery. Instead, it might be helpful to ask ourselves, 'How much money is required for me to be happy? Will the new phone [handbag, car, condo, etc.] bring me happiness?'

Reaching peace with our desires is one way to achieve happiness. Buddha figured that maxim out many centuries ago.
Imran is a business and management consultant. Through his work at Deodar Advisors and the Deodar Diagnostic, Imran improves profits of businesses operating in Singapore and the region. He can be reached at

Sunday, 16 December 2012

Reflections from my stay in Pakistan VII: the Capital Market

In the mid-1990s, Pakistan's Corporate Law Authority (today's Securities and Exchange Commission of Pakistan) issued draft rules for the establishment of mutual funds in Pakistan. The proposed framework was clunky and financial market participants did not bite. Fast forward a couple of decades to 2012 and mutual funds are a major part of Pakistan's capital markets. Large domestic banks such as Habib Bank and United Bank have dedicated fund management companies with significant assets under management (AUMs).

Indeed, the asset management industry calculates its AUMs at approximately USD 4 billion as at November 2012. That may not sound like a lot but it certainly provides enough fees to support a nascent industry for an economy of approximately USD 500 billion (purchasing power parity terms). Additionally, the statistic points to significant growth potential in the coming years, especially as new products are introduced by innovative institutions.

To be sure, Pakistan's domestic capital market has made tremendous strides in several areas other than mutual funds. The bond market, also non-existent until the mid-1990s, has grown and achieved critical mass, allowing corporations to issue debt at market rates in short periods of time. In fact, many of these bonds are purchased by fixed income mutual funds catering to the needs of yield chasing savers.

The stock market's picture is decidedly more mixed. Undoubtedly, the Karachi Stock Exchange's (KSE) market capitalization has grown along with trading liquidity. However, on a relative basis the KSE has lost ground. The KSE is no longer in the MSCI Emerging Markets Index, having been relegated to a frontier market alongside countries such as Nigeria and Sri Lanka. Additionally, the quantum of new listings on the KSE has declined considerably, especially during the last few years, reflecting the broad slowdown in domestic large scale manufacturing.

Besides the traditional stock and bond markets, Pakistan's capital market has a new entrant: the Pakistan Mercantile Exchange (PMEX). In many ways, the PMEX is the most exciting development in the recent growth of Pakistan's capital market. The PMEX became operational in May 2007 with the purpose of introducing futures contracts into Pakistan. Presently, the underlying assets for the contracts include commodities, including agricultural products and interest rates although more contracts are in under development.

For an economy with a large agricultural base, the PMEX has the prospect of revolutionizing the lives of farmers and users of agricultural products. It will permit them to mitigate the risks associated with uncontrollable factors such as the weather. For example, farmers may sell cotton 'forward' and know in advance the sales revenue from the season's cotton crop. Similarly, textile units can lock in cotton prices in advance through the use of cotton futures; thus bringing predictability to production costs.

Notwithstanding these positive developments, the Pakistani economy remains weak due to mismanagement and corruption. Investment in new large scale manufacturing facilities has all but dried up, mainly due to the unreliability of domestic electricity supplies. Profitable corporations are holding back from fresh capital outlays until political risks diminish and / or interest rates moderate. Moreover, small and medium sized enterprises are also suffering as a result of inflation, sluggish macroeconomic growth and high interest rates.

Ultimately, Pakistan's capital market will only be as dynamic as the economy which it services. Unless steps are taken to increase economic growth, the country's debt and equity markets will continue to lag other emerging market nations.
Imran is a business and management consultant. Through his work at Deodar Advisors and the Deodar Diagnostic, Imran improves profits of businesses operating in Singapore and the region. He can be reached at

Sunday, 9 December 2012

Why Malaysian bus drivers should earn more than Chinese ... and get preference over other foreigners for Singapore's jobs

The recent strike by SMRT’s Chinese bus drivers has started a debate about wage levels and working conditions for foreign contract workers in Singapore. Yet a couple of questions remain untouched by the debate:

1. Should salaries vary based on a workers country of origin? Yes, absolutely, as long as the wage premium / discount is based on solid reasons.

2. Do Malaysian workers deserve a wage ‘premium’ relative to their Chinese counterparts? Yes, absolutely. Malaysia is Singapore’s neighbor and Malaysians integrate better than most into the Republic’s workforce.
Singapore's foreign labor pool encompasses the entire spectrum of jobs - from the low end street cleaner to the highly paid senior executive
Labor activists and human rights purists adhering to the principle of ‘equal pay for equal work’ might disagree. Certainly the principle applies to people working in their home country. However, when labor moves across national jurisdictions then different factors come into play. Amongst others, these factors include language, education levels and cultural norms. Collectively, these factors affect an individual’s ability to live and work within a foreign society.

Let’s call that concept integration.

During the last few years, Singapore has witnessed disruptive repercussions of varying degrees from foreign workers who are not easily fitting into local society. Yes, these foreign workers drive buses, clean streets or man stalls satisfactorily, in line with their employment contracts and job requirements. However, they also bring with them local customs and practices. Many of these behaviors: riding bicycles on pavements, spitting, not speaking English and sometimes indulging in (petty and serious) crimes to list a few, have created discontent within Singaporeans.

Moreover, as the numbers of a particular nationality grows to ‘critical mass’ levels, particularly within a specific occupation or organization, its citizens feel more emboldened to challenge the status quo in a manner detrimental to Singapore’s interests. That striking Chinese bus drivers’ have forced a political review of established labor management practices demonstrates the strength (and dangers) of such concentrations.

So, how does all this relate to paying Malaysian bus drivers more than their Chinese counterparts? The answer lies in Singapore’s recent history.

Malaysians have more in common with Singaporeans than the traumatic events of 1965 may suggest. Despite the obvious religious differences between certain segments of the two populations, being geographically contiguous and a part of the same ‘civilization’ for centuries has welded the two peoples into sharing many important cultural and social traits. Consider the continuing deep economic linkages between Singapore and Malaysia.
The commercial relationship is no accident. It is a byproduct of the cultural ease of carrying on business in either society as well as the geographical reality of being neighbors.

The two nations are not alien to each other. There is a natural cultural and social fit between the two nations. A large number of Malaysians already live and work in Singapore. They have done so for many years, and without the social disruptions associated with people of other nationalities. Likewise, droves of Singaporeans regularly visit, own properties, businesses and even retire in Malaysia.

It is this relatively seamless social integration of Malaysian workers into Singaporean society which justifies their wage premium. Maintaining social stability through a cohesive work force is worth that little bit extra.  

As a sovereign country, Singapore’s human resource policies must cater to the Republic’s unique characteristics. Political pressures from regional economic giants – an unintended consequence of hiring large numbers of people from one nation – can be minimized by pursuing a more balanced foreign labor policy. To this end, Singaporean businesses might benefit from additional government incentives to employ Malaysian citizens over other nationalities. Implementing policies to encourage a more balanced pool of foreign workers must be a strategic priority for public officials.
Imran is a business and management consultant. Through his work at Deodar Advisors and the Deodar Diagnostic, Imran improves profits of businesses operating in Singapore and the region. He can be reached at

Sunday, 2 December 2012

Labor strikes in Singapore: another psychological barrier falls

The fault line between locals and foreigners just got deeper. Almost 200 bus drivers from China working in Singapore recently protested working conditions and grievances over pay by striking from work for just over a day. Singapore has not seen such 'industrial action' for almost three decades. The action by Chinese bus drivers is significant in more ways than one.

For starters, the action highlights Singapore's dependence on low wage earning foreign labor. They are critical to maintaining Singapore's efficient and competitive economy operating smoothly. Additionally, the bus drivers strike signals to the government problems are afoot at both ends of the 'foreign talent' spectrum.
At the upper end, Singaporeans express concerns about recruiting highly skilled foreign talent. These well paid immigrants are routinely blamed for pushing up property prices, filling up subway trains and even taking away school seats from 'born and bred' Singaporeans.
At the other end of the wage spectrum, foreign low wage earners are blamed for crime and other forms of 'anti-social' behavior, including littering and riding bicycles on the pavement, besides also straining public transport infrastructure. To this list can now be added lack of respect for local law - the bus workers strike was illegal under Singapore law - and a sense of arrogance by bringing 'Chinese' ways of protest into Singapore.
Irrespective of the merits of worker claims of discrimination and the legality of the strike, one fact is undeniable: another feather from Singapore's 'aura' cap has been plucked. Singapore's reputation as a trouble free, well oiled machine is under siege from many fronts.
First came floods on Orchard Road; then murders and loan sharks; subsequently, regular breakdowns on the city's subway system. Now another 'halo' surrounding the 'Singapore Inc.' brand is at risk, i.e. an efficient and pliant labor market.

All eyes are on the government's handling of the strike. How hard will the judiciary be on the strikers, especially with the protest organizers and instigators? Will the work stoppage result in quiet, albeit delayed, concessions to bus drivers? Will revisions to existing methods of managing labor relations be implemented to make the process more responsive to changing conditions?
The strike has exposed one more 'foreign versus local' cleavage. If a clear message is not sent to illegal strikers, there is a real danger the strikes will spread to other sectors, not only among Chinese but other foreign workers. Subsequently, work disruptions will join the growing list of 'novelties' to which today's Singaporeans must adjust. The list already includes train delays, floods, litter, crime and even riding bicycles on the pavement.
Imran is a business and management consultant. Through his work at Deodar Advisors and the Deodar Diagnostic, Imran improves profits of businesses operating in Singapore and the region. He can be reached at