Singapore is going through a period of transformation forced upon by the economic reality of the last few years.Transformations change they way we do things thus challenging our previous believes and habits. We may argue that the change was forced upon us or we had to change to adapt but the fact remains, we had to change to survive. It is evolutionary.

From a country whose prime attribute was a strategic location with a docile manpower to a country where creativity flows it is not a straight path, the conditions for change have to be created. The semiconductor industry was not an indigenous offspring; conditions were created to attract players in this industry to establish themselves here.

It served Singapore well and still remain one of the largest contributors to the island export. Now there is a strong emphasis on life science as a future moneymaking, job creating activity. Government agencies are out to court life science entrepreneurs,
scientists and practitioners to set up shop here. While the search for the new economic activities is on, it is important to remember that the most important aspect will be for all Singaporean to be able to live with and accept changes if Singapore has to remain relevant
and for its business to prosper. Individual firms can quickly relocate, move to China, Malaysia or elsewhere where conditions are seen as more favorable or markets are bigger but you can't relocate a nation!

Here is the other crucial point: to live well and prosper where we are and this means with the neighbours we got. It may be difficult at times but we can't relocate nor can we live defensively or reclusively. We have to help them to prosper for us to prosper too and we have
sincerely to believe in what has been call the 'abundance' paradigm: the more we give the more we receive. China is big and developing rapidly. The chances for Singapore based companies to have any significant impact in terms of overall cost advantage versus
companies based in China are null.

On the other hand South East Asia with its 400 million inhabitants is where Singaporean base companies can make a significant difference. It is not a small market and it is the one that historically we know best. In my role as business consultant and observer of Italian business sentiment, I noted that the quality of the relation between Singapore and its neighbours is more then before an important element in the investment evaluation process.

I have not met instead any potential investor concerned about the relation between Singapore and China. It is a non-issue. Investors interested in China go directly to China; investors interested in South East Asia instead are prepared to considerer Singapore as a center of economic gravity and competence where to base their business. Poor relations between Singapore and its neighbours will affect
foreign investments here.

Costs are of paramount importance and the ability of Singapore based companies to average their costs by integrating low cost, labor intensive, raw material dependent activities in countries like Indonesia or Malaysia and finance and knowledge intensive in Singapore will offer a powerful combination to any foreign investor. It is therefore important to speed up the process of facilitation of business among Countries in the region by eliminating import tariffs, by instituting common practices and standards, by attracting

investments as integrated market rather then individual participants.
There is a renew interest from Italian companies for South East Asia since now it is cheaper then before to set up companies or buy into existing one, secure raw materials or establish distribution networks. There is also the perception that for the Countries most affected by
the economic crisis like Indonesia or Thailand the worst is over even if structural reforms have not been fully accomplished yet .
The reason of concerns remain the limited level of integration in the policies and practices of this region. Once these issues are resolved growth will return.It remains my personal believe that capable Italian
companies must be here to enhance their global competitiveness and their market reach and I am also firmly convinced that here there are still fantastic opportunities for them.

Singapore will remain a good place where to coordinate regional operations and maintain some assets base provided it will be able to add value and reign on costs for business. Recent proposed changes to the tax structure with a reduction in corporate and personal taxation balanced by an increase in the tax rate for consumption are good
decision. Reducing the cost of living may be a more arduous
task but it will be critical to attract foreign investors, researchers, managers and professionals. It is also of strategic importance in my views for Singapore companies to invest in Europe. I am not talking
of real estates here but of buying into, merge with existing companies whose technology and products are deemed desirable for this region.

It is increasingly difficult for Singaporean companies to obtain from foreign manufacturers agencies for territories other than Singapore; they do not have the knowledge or the contact of local players.
The only meaningful way is for Singaporean to invest at the source, to 'become' the manufacturer and from that position of advantage to structure the distribution of the product in the region. This role can be further enhanced by distributing products locally or regionally made to Europe through companies where Singaporean investors have participation or control.

We all have to be ready to look at opportunities in a different manner and learn new ways on how to prosper and this is possible.