Singapore's History

Chapter 9 Merger and Separation

. Reasons for a merger with Malaya

. Reasons for Separation

Do you agree that the merger is an union of convenience?Explain

Why Singapore wanted a Merger with Malaya

1a) Economic Reasons - Need for a hinterland

. Declining entrepot trade and growth of industrialisation

. Need for raw materials

. Increasing population & demand for jobs

1b) Economic Reasons – Need for a Common Market

. With Malaya’s independence 1957, tariffs imposed on goods with Singapore

. Merger can provide for a Common Market where goods can be bought and sold freely without taxes

. Increase trade, expand industries and create more jobs

2a) Political Reason – Desire for Independence

. British unwilling to grant Singapore independence

. Too small a country, not confident of Singapore’s economic survival

. Concerned about communist threat in Spore

. With merger, Malaya’s raw materials and economic development would ensure Spore economic vibrancy

. With merger, communist threat would be checked by Malayan government

Malaya’s Hesitation

. Upsetting the racial balance

. Pro-communist support by the Chinese

Change of Mind

. Turmoil within the PAP

. Split between the moderates and radicals

. Malaya worried split would enable radicals to capture power from PAP

Reasons for Separation

1a) Political Reasons – 1963 Elections in Spore

. UMNO, MCA & MIC formed Spore Alliance

. PAP rejected Tunku’s proposal

. Spore Alliance lost all 3 seats

. Signal that Spore Malays not for communal politics

. UMNO unhappy and vowed to reorganise Spore Alliance to challenge PAP

. Strained relationship

1b) Political Reasons - 1964 Federal Elections

. PAP sent 17 candidates for Federal Elections

. Upset the Alliance Party in KL

. Seen as challenge to its supremacy

. Relationship further strained over PAP’s criticism of MCA as poor representative of urban Chinese in Malaya

. Also unhappy over PAP declaration to help build a Malaysia not based on racial lines

. Both parties lost confidence in each other

2a) Social Reasons – PAP’s programmes

. PAP’s plans to redevelop Crawford, Kampong Glam & Rochor Areas

. UMNO started anti-PAP campaign through Utusan Melayu

. Strained relationships as these speeches increased tensions between the races in Spore

. Tensions escalated with more anti-PAP speeches and resulted in the 1964 Racial Riots

2b) Social Reasons – Malaysian Malaysia

. Spore Alliance announced major reorganisation for Spore state election in 1967

. In response, PAP started by Malaysian Solidarity Convention (formed by PAP to create united opposition to communal-based Alliance)

. all Malaysians, regardless of race, language or religion, to be given equal opportunities

. UMNO saw this as attack on Malay rights and privileges demanded arrest of Lee Kuan Yew

3a) Economic Reasons – Pioneer Certificates

. Spore felt that KL was reluctant to grant PC to new industries to Spore

. Only 2 out of 69 approved

. Spore would lack behind other states in economic growth

. KL wanted to spread new industries throughout Malaysia and not just Spore

3b) Economic Reasons – Common Market

. KL not keen to set up CM though agreed to do so

. Spore goods to Malaya continued to be taxed

. Investors not keen to set up factories in Spore

. Attractive financial packages to set up businesses in Malaya

. Spore felt that it defeats the purpose of having a merger as no CM was provided for

3c) Economic Reasons – Spore’s contributions

. KL demanded that Spore contribution of its revenue be raised from 40% to 60%

. This was to pay for the cost of dealing with the Indonesian Confrontation

. Spore refused as it would cripple its economy

. This strained relations as UMNO would not be able to introduce policies well if the various states refuse to its proposals

3d) Economic Reasons – Bank of China

. KL proposed closing of Bank of China in Singapore

. KL felt that funds were sent from bank to communists in northern Malaya

. Singapore was not for it as the bank played an important role in Singapore-China trade; Chinese goods were affordable for Singaporeans