Singapore is the modern economic success of a country's ability to transform from a third world nation to a first world nation. Today, Singapore has the highest GDP-to-trade ratio in the world and also the third highest GDP per capita in the world. Coupled with the fact that it only took Singapore less than 60 years to achieve its current status with few natural resources, the nation's economic success is truly admirable and sets a good example for today's developing countries. This essay will study how government policy plays an important role in the economic challenges and development of the nation since its independence. This success is based in particular on the government's emphasis on infrastructure and workforce development, as well as the sensitivity it demonstrates in developing policies well suited to the economic situation and the environment of the country. As an independent nation, Singapore faces many challenges. Firstly, the decolonization of Malaysia would mean that entrepot trade would no longer be possible between the two countries. Singapore's main economic sector is trade and commercial activities, as the country lacks natural resources for production. As a result, infrastructure and manufacturing were poorly developed during British colony. Second, the unemployment rate “is increasing by more than 13 percent as the population continues to grow rapidly” (“Singapore Local Economic Development”). The departure of British troops from Singapore further aggravated the situation, as many locals were hired by British families for odd jobs and provisioning. According to the United Nations Industrial Survey, some 21,400 jobs had to be created by 1970 to solve this problem. At the same time, Singapore's status as ...... middle of paper ...... excerpt describes Singapore's reputation among foreign businesses: 'It's an investor's dream' , said Robert Maxon, director of a major oil company Mobil. here, when asked to explain the industrial rush to the little republic. “The government is stable, people are working hard and I can reach the finance minister just by picking up the phone.” Factory sites are available and cheap. The government exercises strict control over unions, which explains its non-inflationary economy. In Singapore, unskilled labor earns between 10 and 156 cents per hour. And there is a lot of work to do. The cost of living in Singapore has only increased by 1.5 percent per year over the past eight years. » (Bellows 241) Despite the success achieved with foreigners, the nation has not yet achieved the same feat with locals. The general standard of living of the working population is still far from the state desired by the government.