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Look at almost any "Global Top Ten" list of economic achievements and you'll rarely see Singapore not in the Top Five. This city-state, with a population half the size of Manhattan, was ranked the #1 information technology savvy country in the world in 2005; the #1 most competitive economy in Asia; the #1 country in Asia for intellectual property rights protection; and the #3 Asian securities market for transparency and regulation.

With a real GDP growth of 7.7% in 2006, Singapore was the third-fastest growing economy in the world. Throw in Singapore's very low levels of corruption, a skilled workforce, a stable environment, and an efficient infrastructure and you see why this ultra-sleek, city-state continues to rank among the very best performing global economies by virtually any measure.

Not that it's been clear sailing for Singapore over the past decade. Since the 1997-98 Asian financial crisis and the sudden downturn in world trade in 2001-02, the government has intensified its efforts to nudge Singapore away from traditional manufacturing toward a "knowledge-based" service economy. Central to this strategy has been the government's promotion of Singapore both as a high-end tourist destination and as "Asia's Switzerland."

Last year, the government awarded casino licenses for the first time ever. U.S.-based Las Vegas Sands and Malaysia's Genting are spending $6.5 billion to build two mega-casinos that are expected to be a significant boon to Singapore's economy over the next decade. Indeed, many credit Singapore's recent strong economic performance to a significant jump in tourism and shopping. Tourist arrivals hit a record 9.5 million in 2006 and are targeted to almost double to 17 million by 2015.

Singapore's legal system, political stability and high living standards have made it a financial hub for Southeast Asia. As a result, Singapore has become the world's fastest-growing offshore banking center. Money is pouring in from Indonesia, the Philippines and Malaysia -- especially from the well-off, "non-resident Indians" who are scattered across the region. The country's $21 billion financial services industry already accounts for 11% of its GDP -- and this is only set to grow.

So how best to profit from Singapore's economic achievements? The iShares Singapore ETF (NYSEARCA:EWS). Singapore's booming financial sector has the largest sector weighting with around 36% and includes otherwise inaccessible names like DBS Group Holdings, Ltd., United Overseas Bank, Ltd., and Oversea-Chinese Banking Corp. The telecom weighting of 12.6% consists solely of Singapore Telecom, Southeast Asia's largest telecom operator, which itself holds stakes in its counterparts in the Philippines, India, and Thailand.

EWS 1-yr chart
EWS

Disclosure: Author has no position in EWS.

Source: Singapore: See What This Little Overachiever Can Offer