Lee Kuan Yew made Singapore a global player, writes Tim Huxley

In a region of the developing world where post-colonial political leadership has been characterised all too often by incompetence and greed, Singapore's People's Action Party government has since 1959 supervised the transformation of this small, ethnically heterogeneous former colonial city into an oasis of prosperity and stability with a per capita gross domestic product larger than that of many developed nations.

Though Lee Kuan Yew, the PAP's foremost but uncharismatic progenitor, surrendered the post of prime minister in 1990 in a move that other regional leaders could have usefully emulated, over the past decade he has continued to exercise guiding influence over the government from his position as "senior minister".

Singapore's successes, and Lee's role in them, have not provoked universal admiration. In its own region, Singapore is often portrayed - particularly by nationalists and Islamic politicians in neighbouring Malaysia and Indonesia - as a parasitic and selfish Chinese state that oppresses its Muslim minority. That Singapore survived the economic recession of 1997-98 largely unscathed while other Southeast Asian economies collapsed around it only reinforced its neighbours' negative perceptions. In the West, Lee is best known as a proponent of illiberal "Asian values" arguments that question the universal value of western notions of democracy. western critics have often taken Singapore to task for its supposed abuses of human and civil rights and have pilloried its social-engineering projects. Critics have gleefully derided some of the city state's apparently silly regulations, such as the ban on the sale of chewing gum. Yet aspects of Singapore's economic development and social organisation have provided models for Asian states as diverse as Malaysia and China. And Lee, though often reviled by those whom he would call "western liberals", is respected as an elder statesman by many governments in Asia and beyond.

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The first volume of Lee's memoirs focused on his early life, the PAP's rise to power, its push for union with Malaya, and the tensions that led to Singapore's eventual separation from Malaysia in 1965. Its publication in 1998 created a minor regional sensation. This was most obvious in Malaysia, where there was outrage at Lee's quite credible claim that senior Malay politicians from the leading party in the governing coalition had deliberately provoked the 1964 race riots in Singapore.

The second volume, From Third World to First , picks up the story in 1965. It has proved less controversial, mainly because Lee - not wishing to exacerbate Singapore's already neuralgic relations with its neighbours - has pulled his punches. In his acknowledgements, Lee says: "I wanted to avoid unintentionally hurting Malay sensitivities and have tried hard not do so." When assessing the future of Singapore-Malaysia relations, he is uncharacteristically equivocal. At one point, Lee argues that to "speak of Singapore-Malaysia problems as 'historical baggage' is to miss the pointI the root causeI is our diametrically different approaches". But paradoxically, he then concludes that a "younger generation of leaders will soon be in charge in both countries. Free from the personal traumas of the past, they can make a fresh start..."

The early chapters of From Third World to First detail the efforts of Lee's government to develop Singapore after 1965, focusing on the construction of a defence capability; efforts to counter the potential damage, in economic as well as security terms, of Britain's military withdrawal; the creation of an international financial centre; language policy; and anti-corruption measures. These chapters offer valuable insights into Lee's thinking as he and his cabinet worked to mould a new nation amid economic adversity. His early inclination - vetoed by his colleagues - to enforce national service for women as well as men is particularly striking.

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Domestic politics receive short shrift, reflecting the fact that organised opposition to the PAP was minimal and ineffective after 1965. Apart from nipping in the bud any resurgence of left-wing activism, Lee's chief domestic political preoccupation as prime minister was to secure the continuation of the PAP's dominance by rejuvenating the cabinet, mainly with hand-picked technocrats and (though he does not highlight this point) military officers, notably including his son Lee Hsien Loong.

Most of this volume, though, is concerned with the island republic's foreign relations and particularly Lee's personal contacts with a startlingly wide array of foreign leaders. Since 1965, Singapore's government, and Lee in particular, has devoted huge energy to building an extensive network of regional and global international relationships. These have widened the city state's security and economic options, allowing it to transcend the constraints imposed by its unstable relations with Malaysia and Indonesia. Lee's memoirs point to his decisive role in making Singapore's foreign policy, particularly in terms of his ability to form close working relationships with leaders as diverse as Harold Wilson, Ronald Reagan, General Suharto, Taiwan's Chiang Ching-kuo and China's Jiang Zemin. Despite their differences, Lee was able to find considerable common ground during the 1980s with Malaysia's Mahathir bin Mohamad, an old political foe from the 1960s.

The memoirs are peppered with vignettes that emphasise the human characteristics and idiosyncrasies of these and many other leaders. But not all of Lee's character sketches are flattering. He clearly found it more difficult to work with western politicians who emphasised human rights and liberal ideals, such as Jimmy Carter, Chris Patten and Australia's Gough Whitlam ("a sham white Afro-Asian").

It has often been said that Singapore's separation from Malaysia deprived Lee of a part for which he would have been well suited: leader of a country rather than a mere city state. However, as this volume emphasises, in some ways Lee has played on a larger stage, notably as an interlocutor with US, Chinese and Taiwanese leaders. Though the extent to which he performed a stabilising role in the tense US-Chinese stand-offs over Taiwan in the 1990s is not entirely clear, his sophisticated understanding of the three parties' positions is evident. Despite his stress on the importance for East Asian stability of a continuing US regional security role (which will balance China's growing power while restraining any revival in Japanese militarism), Lee has little sympathy for those Americans who see China as a dangerous rising hegemon that must be "contained". His central message on China is that comprehensive engagement with Beijing is the only sensible option for other Asian states and the West.

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Tim Huxley is director, Centre for South-East Asian Studies, University of Hull.