Singapore is a unique country in that it's also only a city and happens to be one of the premiere centers of finance, trade, and so much more finding itself outperforming many other larger and even more powerful countries in many ways.
Obviously, this is in part due to its geographic location, but this can't explain the success of Singapore alone as places like Egypt and Panama also hold trading choke points without the same level of success.
In addition, Singapore must have the support of more powerful nations but often doesn't find itself mired in global international conflicts between the US, China, India, Russia, etc (at least not outwardly).
I'm curious as to what resources peal back some of these layers of its history, the power struggles, the agreements made around it, and how it continually keeps itself such a politically exceptional entity, especially in context to what the area was like before global trade. If there are any who have an expertise in all this and can share their own version here, it's much appreciated!
Singapore's economy is basically the result from the Economic Development Board funded in 1961. A board of experts which focused in making Singapore the most attractive place for Foreign Direct Investment (FDI) in the region by setting taxes, regulations and goverment interference as low as possible and by enforcing economic policies such like minimal work rights, massive inversion (durable goods which produces more goods), minimal consumption (like wages used on food, clothing and so on), minimal welfare and so on. For a few decades, workers experienced extreme hardships, but during the same generation they lifted themselves out of poverty rather quickly and won new privileges and rights. Basically, enforcing capitalism on it is more raw form but with modern financial and social institutions.
This made the economy of Singapore basically a massive entrepot. That is, where goods traveling around it's strait enter Singapore, where they store them, administer them, resell them for profit, or work raw goods and make them finished goods and exports them back for a profit. Literally the whole economy of Singapore is solely entrepot and nothing more. Their economy is exclusively based upon profiting from external trade basically.
While some FDI also went to South Korea, Taiwan and Hong Kong, Singapore by far received the biggest share of the whole FDI that went into Asia for the 1960-1990 period. Which at the same time bolstered inversion in education and made it the heart of the financial system in Asia alongside Hong Kong which then produced even more competitive advantages which just produced a virtous cycle of development.
That is a little more of the result part, though. The real reasons behind Singapore's success relays on it's geographic location, coupled with a diminute population base (1.6 millions) and a lack of competition in the region during the Cold War.
The British Empire decided to build one of the most sophisticated and biggest ports in the world in Singapore to host a massive navy to preserve their colonial interests in the region. They started in 1923 and finished in 1939. They really little knew World War II would come and that their Empire would collapse shortly afterward. This left Singapore with the most advanced piece of infrastructure in comparison to their population by the time of it's independence by sheer luck and it's geographic location.
It's geographic location, again. It is literally the heart of Asia, the biggest region in the world! Far more volumes travel through Singapore that they do at Panama or Egypt, specially since Singapore is a natural sea travel, whereas Panama and Egypt requires from special infrastructure which severely limits the volume of movement that goes around, specially for the Suez Canal. An entrepot exclusive economy would be impossible without such a luxurious ubication. Plus Panama lacked direct control of the canal until recent times (since they "won independence from Colombia thanks to the US", Canal ownership was the payment) and since then it has been developing almost as fast as Singapore did in the past.
Most the FDI for the region (which is the biggest one, thus the biggest chunk of worldwide's share of FDI) due to lack of competition. Asia was a political mess for FDI during the Cold War. Communism, Socialism or Anti-FDI policies in China, North Korea, Vietnam, India, Bangladesh, Pakistan, Indonesia, Japan and Mongolia. Poorly educated elites, feudalism, civil wars, hardline dictatorships with martial law, absolute monarchies, independence struggles, neo-colonial institutions and a few things more in the remaining places. Only Taiwan, South Korea, Hong Kong and Singapore were left, basically. All the low-labor intensive and high-trade intensive trade inversions went to Singapore (like oil refineries) in the early period and afterwards also knowledge-intensive (like pharmaceutics).
Politically Singapore was stable and sound since they had some degree of self-governing as a response from the British after the British Raj fiasco. This time of self-governance but inside the British system allowed for the development of a highly educated governing elite in a short frame of time. They won independence mostly effortless as a collateral from the struggling Malaysian movement, and while they at first wanted to merge with Malaysia, they changed of mind as they noticed that wasn't convenient for them, and since they had a stable goverment before the merge they didn't have a hard time to make the province unworkable for Malaysia, thus easily reverting merging and arising Singaporean nationalism.
And finally, it's population. FDI and Entrepot are extremely limited venues of revenue. It is like with natural resources. Nigeria produces sightly more oil than Norway (and Norway became rich mostly only from oil and education), but while Norway can become rich with that much oil, Nigeria can't as it has to divide the revenues for a 35 times higher population. Singapore would have never developed as faster and strongly if it had a higher population base: India arguably had more infrastructure than Singapore left by the British, but almost half a thousand times the population to distribute it. The same happens with Egypt's comparison: Egypt has about 13 times the population: they just plain can't live from entrepot and FDI like Singapore does; Suez Canal indeed greatly helps Egypt, but that alone will never lift them out from poverty.