Singapore developed in response to changes occurring outside it and independent of its existence. The point was made in chapter 2 that the chief factors underlying this development were a growing world demand for the primary products of Malaya and Netherlands India and the shipping links available to Singapore by virtue of its strategic position on the primary world east–west shipping route. These factors were equally important during the first four decades of the twentieth century.

Since trade as an engine of growth depended on rubber and petroleum after 1900, this study now turns to an examination of their expansion and role in Singapore's economic development. The focus cannot be exclusively on these two commodities, however. The traditional trades of tin, tropical produce and rice, although no longer the dynamic elements in growth, were important to it, for as well as continuing to demand infrastructural services and providing a fund of experience on which Singapore could draw, their still high volume and value made growth a matter of building on an existing foundation of trade rather than of having to start anew.

The present chapter analyses why trade centred on Singapore, how it was financed and what its principal development implications were. Sections I and II consider the course of Singapore's trade and the main volume, value and development features of primary commodity exports to the West.