Yet, I am always wary about putting quasi-religious faith in any economic theory. Something in me says every economic idea contains the seeds of its own disproof, and this one is not going to be any different, given time.

But until that disproof comes, we're going to have the ride the ups and downs of globalisation. 

I recently bought an airline ticket online, and the experience brought home to me how things are rapidly changing, but it also set me asking how Singapore is going to cope.

It's not as if I am an avid aficionado of online purchasing. Far from it. I shall humbly admit I am unnerved by every tale I read of credit card fraud and identity theft. Hence, I do choose with care with whom I make such transactions, trying in my own subjective way, to limit my exposure to reputable companies.

So I began by looking at Singapore Airlines' online booking site. You could hardly get more reputable than that. Even so, I thought their asking S$480 for an economy seat (return) Singapore-Bangkok a bit rich, especially when the budget airline Air Asia had just launched its S$59.90 fare (one-way) [1]

This is the first point I want to make: the days of bilateral air services agreements are coming to an end. Today's economic theory touts the benefits of open skies, and fierce price competition will soon be the order of the day. What exactly Singapore Airlines is trying to achieve with a $480 price, when pre-SARS and pre-Air Asia, I recall paying $425, I don't know.

My concern with Zuji is that they sometimes have technical glitches with their site, and it happened again!

All went well until nearly the end. At that point, from my previous experience, there should have been a confirmation page on the screen, which I would be requested to print out for my retention. This time, that confirmation page never appeared. I waited some 15 minutes. Prior to that it had warned me not to hit the "Back" or "Stop" button, as these would abort the purchase with unpredictable results. Thus I couldn't go back, nor could I stop, but it clearly wasn't going forward.

Oh, to hell with it. I eventually hit "stop". But it left me with a problem: what if the system had debited my credit card for the purchase but never got to issuing me a ticket or making a reservation? Would I be in for a frustrating wrangle with faceless corporates!

The following morning, I called Zuji's hotline.

"Press 1 to make a new booking, press 2 to check status of your booking."

I pressed 2.

"Press 1 to speak to someone in English..."

I pressed 1.

And expected cloying music. But to my surprise, a voice came on, and a greater surprise - she had a strong Australian accent.

I had been routed to a call centre in Australia - that's why the second question was what language I wanted to use. If I had said Chinese, I might have been routed to Taiwan or China. That's globalisation. Or off-shoring - the latest killjoy in the American presidential election.

The funny thing is this: most times, offshoring means relocating call centres to really cheap third world countries like India. Australia is not a third world country. Its per capita income is higher than Singapore. Of course, labour cost is not the sole determinant. Training costs, infrastructure costs, rents, legal protection and many other factors count too. Ultimately, it's overall value for money that shapes the decision.

And in this case, it seems Australia, despite its higher per capita income, was judged by Zuji to give better value.

I can imagine many factors in that country's favour: a friendlier people, thus a more pleasant pitching of the voice; greater ease with the English language, thus better able to articulate what the problem is and how to go about solving it. Almost surely, Australians tend to display more personal initiative (as opposed to falling back on rules), so essential to being successful in helping customers. In addition, Australia can boast of lower rents, outside of downtown Sydney or Melbourne at least.

And these are Singapore's weaknesses. Our slightly lower labour cost does not compensate for the much poorer quality of people that we have. Our language skills are poor, our customer service attitudes dreadful, and problem-solving skills as rare as snow on this tropical island. Not to mention how the government, through its monopolistic pricing of development charges, has raised property prices, and consequently rents, to punitive levels.

So here we are losing electronics manufacturing - the mainstay of our economy for the last 30 years - to China, but not in very good shape to attract services.

Oh, we're going for biotech, I am reminded.

Well, let me remind you, at the height of the SARS scare in the first half of 2003, the government tried to pull a rabbit out of the hat. In effect, they said (via glowing articles in the Straits Times) that one silver lining from being severely hit by SARS was that with all the samples at hand and the national resources put to the task, we could be one of the first places to develop a test kit, and then a vaccine for it. That would put us in the big league of medical research.

Not forgetting the possibility of big bucks.

Three months after the supposedly last case left the hospital in May, and the all-clear was declared for Singapore, a 27-year-old National University of Singapore (NUS) post-doctoral student came down with SARS. He had spent some time in 2 labs which held samples of the SARS coronavirus, though he was studying and working with quite a different virus: the West Nile Virus. Nonetheless, suspicion fell at once onto the labs as a source of infection - the NUS lab and the government's lab at the Environmental Health Institute (EHI).

Impossible, said the Health Ministry bureaucrats. The student merely spent 20 - 30 minutes in the EHI lab on 23 August, and anyway records showed he only had access to the West Nile Virus samples. Furthermore, the EHI lab was designed to meet the World Health Organisation's bio-safety level 3, a very rigorous safety standard. All the procedures were there. There's no way he could have been infected at the EHI lab. 

Implicit in the bureaucrats' rejection of the hypothesis that he was infected at the EHI, was that he must have got it from the NUS lab, which was not the ministry's direct responsibility.

The poor guys' diagnosis was confirmed on 8 September, and a sample of the virus in him was genetically sequenced. It turned out to be virtually identical to the sample stored in the EHI lab. With that, there was no more denying that he was accidentally infected while in the government's laboratory.

A panel of 11 experts from Singapore, WHO and the US Centers for Disease Control was formed to review what happened. In its report, it said that bio-safety standards were below those necessary for handling infectious diseases such as SARS. In other words, the lab did not meet the requirements of bio-safety level 3.

The Health Ministry then admitted in a statement, that "inappropriate laboratory procedures" allowed the West Nile Virus to be contaminated with the SARS virus [2]. Whatever might have been the intention, in practice, people were sloppy, going through the safety procedures by rote, and, to use a famous Singaporean expression, 'bo-chap'.

Antony Della-Porta, a WHO bio-safety expert and chairman of the panel said, "The main thing we want to emphasize is that safety is about culture, where people willingly talk about any problems they have and there is good communication and they are willing to address issues that relate to safety."

This culture of which he speaks doesn't sound like Singapore at all. Consider how the Health Ministry bureaucrats got all defensive when, at the outset, it was suggested that the EHI could have been the source of the infection.

Anyway, as part of the clean-up, the EHI had to destroy all their SARS coronavirus samples. Along with that was destroyed the dream of being the first place to discover a vaccine for the disease. So much for bio-technology as the vanguard for Singapore's future.

That may be the crux of our problem. We're a third world society, with an authoritarian government that needs a mindless population to keep them unchallenged in power, wanting to be a first-world economy that needs first class minds.

© Yawning Bread