Singapore represents Lee's economic legacy

From its early days, Singapore focused on enabling infrastructure for facilitating trade. Along with the Singapore port, the Changi Airport became one of the world's best. The seaport and airport give Singapore unbeatable advantages in the movement of goods and people. In this respect, Singapore was one of the pioneers of trade facilitation with emphasis on strong logistics.

The advantage of being a transshipment hub along with proactive outward-oriented policies made Singapore a processing center. It was one of the earliest in the world to realize the importance of value chains and intra-industry trade. Re-exports of items, after some value additions in domestic processing facilities, have placed Singapore firmly in regional value-added chains. Efficient execution of these was helped by Lee's focus on technical education allowing the local workforce to participate meaningfully in processing.

The Southeast Asian economic boom halted after the Asian economic crisis of 1997. Since then, high-growth economies of the region like Malaysia, Indonesia, Thailand and the Philippines have not been able to reproduce their economic success. Singapore has been an exception. With a per capita income of $55,182 in 2013, Singapore was the eighth-richest country in the world, ranked above the United States, Canada and the Netherlands. In comparison, Malaysia, the second-richest country in Southeast Asia, had a per capita income of $10,457, or less than 20 percent of Singapore, in 2013.

Singapore's success in breaking out of the middle-income trap is due to its pragmatic and visionary planning. While the Asian financial crisis hurt the other manufacturing export-oriented Southeast Asian economies, Singapore could overcome the crisis by focusing on export-oriented services. Strong and modern financial regulations established Singapore as a global financial hub. Along with its seaport and airport, financial services have made Singapore one of the most efficient intermediaries in the world of modern business. Global businesses have little choice but to have a presence in Singapore given the depth and scale by which the country coordinates world business functions.

One is not sure if Lee visualized the Singapore of today when he began transforming it 50 years ago. But his unique and pragmatic development strategy has transformed Singapore as well as Asia. As such, modern Asia's economic vibrancy and strategic importance is inconceivable without Singapore.

The author is a senior research fellow at the Institute of South Asian Studies in the National University of Singapore.