In his memoirs, Lee Kuan Yew (LKY) gives 2 reasons for believing that Singapore and Malaya ought to be one country.

The first was that Singapore and Malaya had been governed by the British more or less one territory with administrative headquarters in Singapore.

The second was that Singapore depended on Malaya for water, a point which was brought home when the Japanese conquered Johor and the water supply was cut off.

However, I am quite sure these were not the only two reasons. The belief that Singapore could only achieve independence as part of Malaya was very common, and very popular in Singapore. Both Singapore's main political parties in the 1950s, the Labour Front and the People's Action Party (PAP), campaigned on the platform of independence for Singapore as part of Malaya. LKY, as leader of the PAP, had been elected on just such a platform. Even the more radical socialist wing in the PAP, whose members knew they would face more scrutiny and restrictions on their activities as part of Malaya, publicly supported merger with Malaya - this was clearly a real vote winner.

Those who supported independence through merger tended to do so for economic and political reasons. While I don't know that LKY ever overtly said he endorsed all of them, they were popular, uncontroversial arguments. It is likely that LKY, being a staunch supporter of merger, agreed with them.

British support for merger

The biggest reason for supporting merger with Malaya was that independence literally seemed impossible without it.

In the 1950s, mainstream leaders in Singapore and Malaya were fiercely in favour of independence, but were not prepared to engage in violent uprising. Thus, independence could only be achieved if the British agreed to it.

In principle, this wasn’t a problem for the British. They were completely prepared to grant independence to their Southeast Asian (SEA) colonies. However, given the state of the post-WW2 world, the Empire was not quite prepared to withdraw completely.

A military presence was still necessary to protect British interests in SEA. Should these be threatened in any way, such as a rebellion against an ally, the nationalisation of British investments, or an unfriendly government seeking to close shipping lanes, British forces could deploy rapidly and set things right.

Due to its strategic location, Singapore was chosen as the base from which British forces would deploy. Thus, Britain’s navy, airforce and army all constructed extensive, and expensive, bases in Singapore. Singapore became the main administrative, supply, maintenance, transit and recreation facility for the region. Indeed, at one point in the early 1960s, Britain even stored nuclear weapons in Singapore’s Tengah airbase in case nuclear strikes against China were ever called for.

This complicated the question of Singapore’s independence, because if a government hostile to Britain were ever to come to power, Britain could lose access to its expensive bases and the means to protect British interests in the region. Worse still, powerful military hardware (including nuclear weapons!) would be left in the hands of a hostile power, which would have terrible global ramifications.

Unfortunately, the political situation in Singapore did not fill the British with confidence. In fact, Singapore looked likely to turn into a communist state. Malaya was grappling with a communist insurgency that drew its support almost entirely from Chinese, and Singapore’s population was about 75% Chinese. Singapore’s Chinese trade unions were powerful and fond of striking, and several of their leaders had, in fact, been elected to power under the PAP.

However, those factors could be mitigated through a merger with Malaya. If Singapore and Malaya were one country, then Malaya could devote resources to defeating communism in Singapore. Even if the communists gained power, they would merely be running one state out of several, with no control over foreign policy or military forces. Their voice at a national level would be diluted by the voices of representatives from all the other states in Malaya.

The British made known their support for this. Thus, a merger with Malaya was seen as the only way the British would ever agree to Singapore’s independence.

Economic survival

There were looming economic challenges for Singapore in the 1950s. The colony was in the midst of a population boom with an underdeveloped economy. In a generation’s time, there would not be enough jobs to go round. With no natural resources, industrialisation was the only way forward.

Singapore did have a small industrial sector, but this involved the processing of raw materials from Malaya. Tin from Malaya was transported to Singapore where it was smelted. Pineapples grown on Malayan plantations were canned in Singapore. Singaporean factories turned Malayan rubber into simple rubber products. In other words, Singapore’s existing industries were completely dependent on Malaya, and it was likely that most other industries Singapore could develop would likewise rely on Malaya.

For proponents of merger, a merger between Singapore and Malaya meant a common market. Raw materials would flow, untaxed and unimpeded, into Singapore. Just as importantly, manufactured goods from Singapore could flow into Malaya.

This plan was very much a product of developmental economics of the 1950s, a branch of economics that was becoming popular as decolonisation swept across the globe, creating large numbers of newly independent developing nations.

The core argument of developmental economists was that developing economies faced unique challenges, and thus needed unique economic policies. In the 1950s, one very popular theory was import substitution. Proponents argued that developing economies didn’t have the money to import both consumer goods (handbags, clothes, washing machines etc.) and capital goods (machinery for factories, tools and other items needed to industrialise). Developing economies should thus spend their limited cash on importing capital goods. But since a country couldn’t go without consumer goods entirely, a developing nation should manufacture its own consumer goods for its domestic market.

Several developing economies in South America, Africa and Asia embraced this theory, and Singapore’s leaders were no exception. However, Singapore’s population was tiny and could not provide a big enough domestic market to support its manufacturers. Malaya’s domestic market was thus essential to making import substitution work, and only merger with Malaya could give Singapore’s manufacturers access to this market.

Today, the idea that Singapore needs Malaya as a ‘hinterland’ seems ridiculous. But I can’t even find the words to describe just how different the world of the 1950s was from today in terms of politics, dominant economic theory, technology and their impact on the world. Not merging was widely thought to be fatal for Singapore. Indeed, it was a moot point since the British would never grant independence in the first place.

As it turned out, merger was such a mess that when separation was announced, Singapore’s stock market rose and Chinese businessmen celebrated in the streets. But for LKY it must have been frightening, as he and his government were left trying to make things work after repeatedly predicting doom for Singapore going it alone!

I'm not an expert on LKY so I don't quite understand what you mean by 'how did he see his political ideology situated within the Malaysian political system'. If you clarify I might be able to answer (or not, as I say, I'm no expert on the man himself).

Borschberg, P., Heng, D., Tan, T. Y. & Kwa, C. G. (2019) Seven Hundred Years A History of Singapore. Marshall Cavendish.

Murfett, M. H., Miksic, J. N., Farrell, B. P. & Chiang, M. S. (2011) Between Two Oceans A Military History of Singapore from 1275 to 1971. Marshall Cavendish Editions.

Lee, K. Y. (1998) The Singapore Story. Marshall Cavendish Editions.