From fishing port to financial fortress: Singapore’s biggest investment has always been in itself.
My first trip to Singapore was back in 2005 — and I didn’t love it.
Maybe I’d compared it too much to New York or London. Maybe I’d just spent too much time indoors, wandering from one air-conditioned mall to another.
Back then, the city struck me as sterile and over-engineered. Like if IBM was a country. What William Gibson once called “a relentlessly G-rated experience, micromanaged by a state that has the look and feel of a very large corporation.”
But this time was different.
This week I returned for the F1 Race and the TOKEN2049 conference. I found a city that’s still squeaky-clean and obsessively planned, but now buzzing with a new kind of energy. The skyline is greener, the ambitions are higher, and the whole place feels like a gigantic long-term bet that’s paying off.
Singapore, with just six million people and no real natural resources, has become one of the richest countries on earth — not by luck, but through decades of disciplined, deliberate investment in itself.
Plenty has been said about how Singapore transformed itself from a swampy outpost into a self-funding global powerhouse. Singapore’s GDP per capita today sits around $91,000, the highest in Asia and 4th highest in the world.
(When measured by Purchasing Power Parity (PPP) per capita, which accounts for the cost of living, it’s the #1 richest nation in the world.)
The real story going forward is how it sustains that success — continuously channeling capital into infrastructure, housing, and innovation in a way few nations can match.
Today I’ll share a few notes & anecdotes from The Garden City, and look at what other countries (and investors) can learn from the way Singapore allocates capital through a unique mix of state control and private innovation.
Let’s go 👇
Table of Contents
A long history of investing
Building prosperity
When Singapore became an independent city-state in 1965, it was small, humid, and vulnerable. A speck of land with few natural resources and no hinterland. Its first great act as a nation was to invest in itself. And the architect of that vision was the legendary Lee Kuan Yew — Singapore’s first prime minister and the man who essentially built a city-state from scratch.
Singapore had one huge advantage: Its deep harbor was one of the world’s most strategically-located ports. Lee turned Singapore’s geography into an asset and governance into a growth engine.
Lee Kuan Yew lived through the Japanese occupation and studied in London, absorbing the logic of British trade and the mechanics of self-funding economies. When he returned home, he applied those lessons ruthlessly. Every policy, port, and housing block was a calculated move on a national chessboard.
To attract global manufacturers, his government offered something unheard of in the region: low taxes, predictable rules, and fast paperwork. In 1961, Singapore created the Economic Development Board (EDB) a “one-stop agency” designed to make foreign investment frictionless.
Jurong, a swampy western corner of the island, became the flagship industrial project. Within a few years, factories replaced mangroves, and Singapore’s first industrial estate began exporting goods to the world.
Tourism as an investment
By the mid-1960s, Lee had begun treating leisure as an industry in its own right, creating the Singapore Tourism Promotion Board in 1964 as a a deliberate hedge against industrial cycles.
Lee recounted how a soft-drink manufacturer suggested that tourism could provide low-cost, high-employment growth: “It was labor-intensive, needing cooks, maids, waiters, laundrymen, drycleaners, tour guides, drivers and makers of souvenirs.”
Changi and the Jewel
The same investment logic shaped Changi Airport, which Lee later called “the single best investment we ever made.”
Changi was conceived as both critical infrastructure and global marketing. A spotless, fresh, mind-blowing arrival experience became Singapore’s calling card. (Check out Trung Phan‘s recent issue on the development of Changi.)
Four decades later, the Jewel at Changi extends that vision. This is a S$2 billion “rainforest mall” by architect Moshe Safdie (the same guy who designed the Marina Bay Sands.)
See, this isn’t just a stopover point for travelers, it’s a destination in its own right. Locals come here on purpose. It’s become a hugely popular place to get married. Residents spend weekends shopping, dining, climbing rock walls, and taking photos beside the “Rain Vortex,” the world’s tallest indoor waterfall.
When you look at Singapore’s success, it’s easy to forget that each of these projects — the port, Jurong, the tourism board, Changi — began as state-backed investments. Together they reflect a national reflex that hasn’t faded. The island’s wealth was built one deliberate reinvestment at a time.
Housing and the ownership engine
But if there’s one place where Singapore’s investments are most visible — where planning, policy, and capital all intersect — it’s in housing.
While the city routinely sits near the top of global rankings for high cost of living, the government has managed a remarkable balancing act: it’s one of the world’s most expensive real estate markets for outsiders, and yet one of the most affordable for its own citizens.
The backbone of this system is, you guessed it, a government entity called the Housing & Development Board (HDB).
Roughly 80% of Singaporeans live in HDB apartments, usually clustered around public transit lines that make private car ownership unnecessary — a sensible choice in a city where the right to own a car can cost more than the car itself!
Technically, residents don’t own their units outright. Instead, they purchase 99-year government leases, giving them secure long-term tenure without ever surrendering state control of the land. It’s one of many structures designed to ensure stability and discourage speculative flipping. Housing as a utility, not a casino.
The financing mechanism is just as deliberate. Singapore’s Central Provident Fund (CPF) channels part of every worker’s paycheck into personal investment accounts, which citizens can use for down payments. First-time homebuyers can also get grants up to S$80,000.
Foreigners, however, face an entirely different reality over here. They’re barred from subsidized HDB housing and sharply limited in what they can buy elsewhere. Access is generally restricted to private, non-subsidized condos. And even then, it comes with steep penalties.
The Additional Buyer’s Stamp Duty (ABSD) is Singapore’s way of managing speculative demand and preserving affordability for citizens, while ensuring foreign capital doesn’t totally distort the market.
- Singapore Citizens: 0% on their first property, but rises to 20%+ on second homes.
- Permanent Residents: 5% on the first property, 30% on the second.
- Foreigners: a staggering 60% on any residential property.
NOTE: Interestingly, there are five countries whose citizens are exempt from the 60% foreign-buyer tax: Norway, Switzerland, Iceland, Liechtenstein, and yes, the United States.
This system ensures that the soaring costs of the global city do not bankrupt its citizens but instead, provide them with a fundamental pillar of financial and social stability.
It’s no surprise that the state takes the same hands-on approach to managing its national wealth.
The capital of capital
Singapore’s national wealth is managed through two massive state-owned funds, Temasek and GIC, which punch way above their weight on the global stage.
- Temasek is a S$434 billion fund designed to hold equity stakes in domestic champions like Singapore Airlines, DBS Bank, and Singtel. It operates like a national PE firm, actively buying, building, and exiting positions to compound returns rather than passively holding them.
- GIC meanwhile, acts as Singapore’s global hedge fund, with a mandate to invest abroad. They invest in infrastructure, real estate, and public markets across 40+ countries.
Together, Temasek and GIC have built a financial buffer that protects Singaporeans against shocks and secures long-term prosperity.
On a per-capita basis, Singapore invests more through its sovereign funds than almost any nation on earth — trailing only Norway, Qatar, and Kuwait.
The next chapter
Singapore has mastered the art of national investment. What it’s perhaps still learning is how to invest in uncertainty.
In a viral essay published last month, a young Singaporean recently captured the mood. He argued that the country’s success, it’s utopia, if you will, has come at a cost — a society so efficient and well-designed that it’s lost its appetite for risk.
“They built a country which works so well, it has tamed the utter chaos that historically defined most of our forebears’ lives and given us all a neat, packaged life. A life which most of us can live formulaically, sleepwalking through it without doing a single brave thing… Where are all the local companies that we can point to and be proud of? Where are our Ericssons and Nokias?”
That critique hits a nerve. For all its prosperity, Singapore’s startup ecosystem remains cautious. The city produces founders, but not many risk-takers. The best talent often flows into consulting, banking, and law. (i.e., careers that reward compliance, not experimentation.)
“We’re so numerate, we know instinctively that starting something new has a lower risk-adjusted EV than working hard as an investment banker or software engineer, and with a far higher Sharpe ratio too.”
The government is trying to change this calculus. Through Enterprise Singapore, SGInnovate, and venture capital tax incentives, the state is nudging capital toward early-stage startups, and positioning itself as a regional launchpad for APAC innovation.
It’s starting to pay off. In July, I highlighted two Australian biotech firms, Vow Foods and Inventia Life Science, that found their first commercial traction in Singapore.
Both chose the city-state for its clear regulations around advanced biotech. For Vow especially, Singapore’s heavy reliance on food imports (and spectacular restaurant scene) combined to make it an ideal test market.
We’re starting to activate the Alts community in Singapore, and next time I’m here I’d like to explore some startups and private lenders.
In the meantime, three big Singaporean public companies you should know about are Sea Limited (SE Asian tech holding company), Grab Holdings (the dominant ride-hailing/delivery app — Uber doesn’t exist here) and PropertyGuru (Singapore’s largest online real estate marketplace.)
Michael Fritzell, the excellent writer behind Asian Century Stocks, has also identified a slew of hidden champions — Singaporean companies that operate below the radar but are worth looking at.
Closing thoughts
Singapore is so high-functioning compared to the US and many other western countries that it’s almost comical.
I’m not saying it’s a utopia, I’m sure there are problems I’m glossing over. But you can’t argue with the results.
Singapore has built the world’s best airport, some of the cleanest and safest streets anywhere, and two of the largest sovereign wealth funds — all while becoming arguably the richest per capita society on earth. Simply astounding for a country 5x smaller than Rhode Island, with no natural resources!
But its success wasn’t a miracle, it was a combination of terrific leadership, hard work (much of it through imported labor!) and deliberate, continuous investment in itself. A masterclass in pragmatic socialism within a ferociously capitalist economy.
To me, Singapore’s strong institutions highlight just how badly the US has lost its sense of direction. In Singapore, competence is rewarded, policy is long-term, and results are measurable.
Meanwhile in the US, politics has devolved into performative theater, infrastructure is crumbling, budgets stall, and every major decision turns into a partisan hostage crisis. While Singapore is building up its institutions, America is gleefully tearing them down.
To be fair, Trump has expressed interest in creating an American sovereign wealth fund, which I think is a great idea. (Although knowing what we know about Trump, that fund could turn out to be uhhh, pretty slushy.)
I do wonder about Singapore’s ability to become a global cultural leader the way that Japan and Korea have. Can a society that frowns upon street musicians and isn’t known for spontaneous creativity ever produce the next Spotify or Apple? Where does alternative investing fit in a culture so carefully engineered for order?
Yet at the same time, I fully understand the country’s cautious mindset. After all, “if it ain’t broke, don’t fix it.” It’s exactly this discipline — the meticulous planning, the relentless execution, the faith in structure — that built this remarkable place.
Well, that and air conditioning.
My god, that humidity…
—
That’s it for today!
A BIG thanks to Artem Goldman from Wonder Family, and everyone at Unlock Venture Partners for inviting me to watch the F1 race from a nice air-conditioned Singapore suite.
Do you live in Singapore? Have any interesting startups or funds we should check out next time? Come say hi in our Singapore Group.
See you next time, Stefan
Disclosures
- This issue was written and edited by Stefan von Imhof
- This issue was sponsored by Delve
- Alts has no holdings in any companies mentioned in this issue.
