The following article appeared in the Melbourne Age. Ho Ching and Temasek should sue the newspaper.
SINGAPOREANS aren’t usually given to open criticism of the Lee family
that has ruled them for half a century. Rightly or wrongly, some presume
that in their tightly controlled island state, walls have ears, and one
never knows who is listening.
But this time it’s different. Singaporeans are deeply displeased with
their Prime Minister’s wife, Ho Ching. She has run Temasek Holdings,
the state-owned fund, since 2002, and has presided over a spectacular series
of misjudgments that have lost Singaporeans billions.
There was the murky $3 billion deal she made in Bangkok in 2006, to buy
then Thai PM Thaksin Shinawatra out of his telco. Ho’s massive plunges
into European and American banks ended in tears last year when Temasek
lost a third of its $100 billion portfolio. In Australia, Ho lost
Temasek’s entire $400 million stake she’d plunged into Eddie Groves’ ABC
Learning Centres, among other missteps.
So much for her much-lauded ‘‘Superwoman’’ smarts and vision when the
state appointed her, even though her pre-Temasek record at Temasek-owned
arms supplier Singapore Technologies was hardly Sorosesque. Today,
Singaporeans are sick of Ho and have been for some time. They want her
out of Temasek, lest she create any more financial havoc for them.
Except she’s not going. In a February ‘‘transition’’ — not a sacking, as
Temasek spun furiously — Ho was supposed to hand over Temasek to Chip
Goodyear, the 51-year-old American (and North Melbourne supporter) who
pointed BHP-Billiton at China for four years and made billions.
The big idea was that Goodyear would fix the mess Ho made in banking and
tilt Singapore into the booming China and India growth stories, which
meant placing Temasek at the middle of big regional resources plays. But
that, too, has ended in tears, when Temasek last week cited ‘‘strategic
differences,’’ announcing it was "mutually agreed" Goodyear would not
become CEO.
It seems clear that after five months hanging around the Temasek office,
Goodyear has been paid millions for his life-long silence.
But only a few days earlier, Goodyear was doing the rounds of Temasek
satellites mapping out his vision. One CEO I spoke to expressed shock,
saying he had been on the ‘‘same page’’ as Goodyear and was looking
forward to working with him. The implication was clear: Goodyear was a
genuine businessperson whereas Ho was not.
That was mid-July. A week later, Chip was chopped. Temasek’s board met
the weekend before last, then announced Goodyear was gone. So what
happened?
The Government-controlled Straits Times said Goodyear’s proposals to
shake up Temasek were viewed as "too risky" by the board. Too risky?
Ho’s bad bets in banks lost Temasek around $30 billion. What could be
riskier than that?
More likely is the take doing the rounds of Singapore’s banking and
business communities. Local insiders, under few illusions that little
happens at Temasek without Government say-so, say the Government has
been spooked by the arrest in China of Rio-Tinto executive Stern Hu.
Temasek hired Goodyear because they wanted him to do for it what he had
done at BHP, expertly play China, which is far more politically
important for an Asian nation such as tiny Chinese-dominated Singapore
than it is for a global mining giant. But after the Chinese Government
arrested Hu and sent a message it was taking back control of its
resources management, it wouldn’t do now, they say, for a foreigner who
knows so much about Chinese resources to front mostly Singapore Inc’s
ambitions in China.
The handling of Goodyear has deeply embarrassed Singapore and seems to
give lie to the fiction that Temasek operates transparently and
separately from Government policy. And knowing how deep runs the anger
among its readers that Ho has squandered a big chunk of their nest egg,
even the normally lap-dog Straits Times was moved to ask how ‘‘private
sector’’ can Temasek really be, commenting: ‘‘Like it or not, Temasek
cannot get away from the fact that it is inextricably linked to the
Singapore Government’’.
It’s shaken up the arcane world of sovereign wealth funds too, where
Temasek liked to portray itself as the model for emerging wealthy
states. Delegations from around the world made pilgrimages to Singapore
to see how it was done, how their state’s strategic jewels can be
packaged and managed into an investment vehicle that maintained the
illusion it was somehow separated from the Government. Journalists
describing Temasek as "Government-controlled" invited a welter of
complaints to their editors from Temasek’s spinners who demanded it be
benignly referenced as an "Asian investment company" with no references
to the Government whatsoever, and certainly not to describe the family
connections of Ho’s. Failure to comply would mean an outlet would be
blackballed by Temasek, which in Singapore ultimately suggests a libel
suit no media company has ever won there.
East Timor decided the Temasek model wasn’t for them, and chose a
Norwegian-inspired transparent route for its now $6 billion petroleum
royalties pile. In many respects, it’s actually a model for Temasek.
Certainly, the East Timorese fund made more money than Temasek has
recently — it invested in boring US treasury bonds while Ho was plunging
billions into Merrill Lynch.
Unsurprisingly, Temasek’s model appeals more to the more authoritarian
and less democratic of states, such as Kazakhstan which, like Singapore,
is run along family lines.
Now Singapore Inc is in a pickle. It said it wants to internationalise
Temasek, and appointing the much-respected Goodyear was a huge – and
widely welcomed – statement. Now it’s stuck with the bumbling Ho, for at
least another year, which simply deepens the market’s conviction that
dealing with Temasek is akin to de facto dealing with the Government.
Temasek says it is continuing its international search for a new boss.
But after Goodyear’s bad year at Temasek, why would anyone want to go
there?
http://business.theage.com.au/business/lumbered-with-the-bosss-wife-20090729-e1oc.html?page=-1
SINGAPOREANS aren’t usually given to open criticism of the Lee family
that has ruled them for half a century. Rightly or wrongly, some presume
that in their tightly controlled island state, walls have ears, and one
never knows who is listening.
But this time it’s different. Singaporeans are deeply displeased with
their Prime Minister’s wife, Ho Ching. She has run Temasek Holdings,
the state-owned fund, since 2002, and has presided over a spectacular series
of misjudgments that have lost Singaporeans billions.
There was the murky $3 billion deal she made in Bangkok in 2006, to buy
then Thai PM Thaksin Shinawatra out of his telco. Ho’s massive plunges
into European and American banks ended in tears last year when Temasek
lost a third of its $100 billion portfolio. In Australia, Ho lost
Temasek’s entire $400 million stake she’d plunged into Eddie Groves’ ABC
Learning Centres, among other missteps.
So much for her much-lauded ‘‘Superwoman’’ smarts and vision when the
state appointed her, even though her pre-Temasek record at Temasek-owned
arms supplier Singapore Technologies was hardly Sorosesque. Today,
Singaporeans are sick of Ho and have been for some time. They want her
out of Temasek, lest she create any more financial havoc for them.
Except she’s not going. In a February ‘‘transition’’ — not a sacking, as
Temasek spun furiously — Ho was supposed to hand over Temasek to Chip
Goodyear, the 51-year-old American (and North Melbourne supporter) who
pointed BHP-Billiton at China for four years and made billions.
The big idea was that Goodyear would fix the mess Ho made in banking and
tilt Singapore into the booming China and India growth stories, which
meant placing Temasek at the middle of big regional resources plays. But
that, too, has ended in tears, when Temasek last week cited ‘‘strategic
differences,’’ announcing it was "mutually agreed" Goodyear would not
become CEO.
It seems clear that after five months hanging around the Temasek office,
Goodyear has been paid millions for his life-long silence.
But only a few days earlier, Goodyear was doing the rounds of Temasek
satellites mapping out his vision. One CEO I spoke to expressed shock,
saying he had been on the ‘‘same page’’ as Goodyear and was looking
forward to working with him. The implication was clear: Goodyear was a
genuine businessperson whereas Ho was not.
That was mid-July. A week later, Chip was chopped. Temasek’s board met
the weekend before last, then announced Goodyear was gone. So what
happened?
The Government-controlled Straits Times said Goodyear’s proposals to
shake up Temasek were viewed as "too risky" by the board. Too risky?
Ho’s bad bets in banks lost Temasek around $30 billion. What could be
riskier than that?
More likely is the take doing the rounds of Singapore’s banking and
business communities. Local insiders, under few illusions that little
happens at Temasek without Government say-so, say the Government has
been spooked by the arrest in China of Rio-Tinto executive Stern Hu.
Temasek hired Goodyear because they wanted him to do for it what he had
done at BHP, expertly play China, which is far more politically
important for an Asian nation such as tiny Chinese-dominated Singapore
than it is for a global mining giant. But after the Chinese Government
arrested Hu and sent a message it was taking back control of its
resources management, it wouldn’t do now, they say, for a foreigner who
knows so much about Chinese resources to front mostly Singapore Inc’s
ambitions in China.
The handling of Goodyear has deeply embarrassed Singapore and seems to
give lie to the fiction that Temasek operates transparently and
separately from Government policy. And knowing how deep runs the anger
among its readers that Ho has squandered a big chunk of their nest egg,
even the normally lap-dog Straits Times was moved to ask how ‘‘private
sector’’ can Temasek really be, commenting: ‘‘Like it or not, Temasek
cannot get away from the fact that it is inextricably linked to the
Singapore Government’’.
It’s shaken up the arcane world of sovereign wealth funds too, where
Temasek liked to portray itself as the model for emerging wealthy
states. Delegations from around the world made pilgrimages to Singapore
to see how it was done, how their state’s strategic jewels can be
packaged and managed into an investment vehicle that maintained the
illusion it was somehow separated from the Government. Journalists
describing Temasek as "Government-controlled" invited a welter of
complaints to their editors from Temasek’s spinners who demanded it be
benignly referenced as an "Asian investment company" with no references
to the Government whatsoever, and certainly not to describe the family
connections of Ho’s. Failure to comply would mean an outlet would be
blackballed by Temasek, which in Singapore ultimately suggests a libel
suit no media company has ever won there.
East Timor decided the Temasek model wasn’t for them, and chose a
Norwegian-inspired transparent route for its now $6 billion petroleum
royalties pile. In many respects, it’s actually a model for Temasek.
Certainly, the East Timorese fund made more money than Temasek has
recently — it invested in boring US treasury bonds while Ho was plunging
billions into Merrill Lynch.
Unsurprisingly, Temasek’s model appeals more to the more authoritarian
and less democratic of states, such as Kazakhstan which, like Singapore,
is run along family lines.
Now Singapore Inc is in a pickle. It said it wants to internationalise
Temasek, and appointing the much-respected Goodyear was a huge – and
widely welcomed – statement. Now it’s stuck with the bumbling Ho, for at
least another year, which simply deepens the market’s conviction that
dealing with Temasek is akin to de facto dealing with the Government.
Temasek says it is continuing its international search for a new boss.
But after Goodyear’s bad year at Temasek, why would anyone want to go
there?
http://business.theage.com.au/business/lumbered-with-the-bosss-wife-20090729-e1oc.html?page=-1
