Comparative Economic Structure and Performance in Taiwan and Singapore

The economic structures of Singapore and Taiwan are strikingly similar. In both economies, the goods producing industries, which consist mainly manufacturing industries, accounted for about one-third, and services producing industries accounted for two-thirds of their GDPs in 2003. They did not start out from the same position, however. Taiwan had an agricultural sector which contributed more than 10 percent to its GDP 30 years ago, while manufacturing and service sectors contributed about 40 percent each. The contribution of the agricultural sector had declined steadily to less than 2 percent in 2003. Manufacturing had expanded and developed rapidly throughout the 30 year period but its contribution had relatively declined to 30 percent due to the even faster growing services producing industries, which made up more than 65 percent of GDP in 2003. On the other hand, Singapore did not have a decent agricultural sector to begin with. Trading, in the form of entrepot trade, was the main economic activity. Industrialisation began in the late Sixties and it overtook the importance of trading later. The service sector, in the form of financial and insurance services, grew together with trading activities. As Singapore developed to become the regional financial centre in Southeast Asia in later years, the service sector expanded further and became the most important sector which contributed more than 65 percent to GDP in 2003