SM Goh Chok Tong claimed that the main reason why Temasek took over China project is because Temasek takes a longer view of this project, while Keppel is "impatent" for immediate returns.
First, who is the majority shareholder in Keppel Corp? Isn't it the government? Doesn't Temasek belongs to the Singapore government? So the government expects quick returns from Keppel, but allow Temasek the luxury of long-term holding.
Second, to expect returns within 3 to 5 yrs from a project of this size and nature is unrealistic even for a private venture. If Keppel had done it's feasibility study, it would know the economic horizon of this venture, and would not have undertaken it in the first place. So why did they?
I suspect that these reason are just bullshit to justify giving Singbridge a leg up into China.
But what is really uneasing is SM Goh spilling the bean that the billions that the PAP government had poured intp Suzhou and Tianjin was based on gut feelings without any economic feasibility study done. This is done so that the PAP can stay "engage" with the communist chinese government. What can be more disturbing than this?
http://www.businesstimes.com.sg/sub/news/story/0,4574,393217,00.html
Why Temasek took China project
Public company shareholders more impatient for returns: SM Goh
By CHEW XIANG
IN SHANGHAI
TEMASEK Holdings took over Keppel Corp's stake in the 'knowledge city' project in Guangdong because it could take a longer view while public company shareholders are impatient for immediate returns, Senior Minister Goh Chok Tong said yesterday.
Speaking in Shanghai at the end of a three-day working visit, Mr Goh said the project could be the first of a 'new model' of China-Singapore collaborations, which would be led by private companies like Temasek.
Both countries' governments have worked together on previous large-scale industrial and development projects in Suzhou and Tianjin, but the new 'knowledge city' in Guangzhou city, in Guangdong province, will be led by the private sector instead.
Keppel Corp, which is taking an active role in the Tianjin eco-city now under development, was also initially involved in Guangzhou but its stake was taken over last year by newly created Temasek subsidiary Singbridge International.
'Keppel did so for Tianjin because (former Keppel chairman) Mr Lim Chee Onn could see the larger strategic purpose for Singapore and for the company,' Mr Goh told reporters yesterday. 'But I think even Keppel would not want to do the 'knowledge city',' he said, noting that returns could take three to five years, a long time for public companies impatient for immediate returns on investment.
Mr Lim is now chairman of Singbridge, while its chief executive is former Economic Development Board managing director Ko Kheng Hwa, who had first joined Mr Lim at Keppel in 2008.
Singbridge has committed to invest two billion yuan (S$411 million) in the initial stage, with a Chinese joint venture partner, a unit of the Guangdong Development District, contributing a 123 sq km plot of land and undertaking infrastructure investment to connect the new development to the rest of the province.
Mr Goh and Guangdong party secretary Wang Yang officiated at a groundbreaking ceremony on Wednesday at the 'knowledge city' site 35 km north-east of Guangzhou city centre.
Yesterday, Mr Goh noted that for the industrial projects in Suzhou and Tianjin, 'on the government-to-government side, we did not do an economic feasibility study'.
'We just felt in our guts that this was something good to do to engage China and that you could make it work,' he said. But Singbridge's present involvement means Guangzhou's 'knowledge city' would be undertaken purely for profit.
'We are commercialising our public sector experience through Singbridge, so we are now able to unlock the value of the civil service for projects like this,' Mr Goh said.
However, Singapore will always take priority in terms of civil service resources, he added.
The 'knowledge city' development is seen as a testbed of the province's ambitious plans to upgrade its economy by shifting to higher-end manufacturing, high-tech industries and research and development. Guangdong has been a centre of China's low-cost manufacturing for decades but wage pressures and increasing labour unrest are eroding its competitive advantage.
Electronics manufacturing giant Foxconn confirmed yesterday that it plans to relocate major production lines from Shenzhen to Langfang in Hebei province to save costs.
Singaporean involvement in Guangdong, and China generally, in such projects would help it stay relevant to its much larger Asian neighbour for the next 10 to 15 years, Mr Goh said. 'The day is already here where we learn from one another,' he said. 'Ten to 15 years from now I think we will be coming here to learn (from the Chinese).'
During his working trip, Mr Goh also visited eight pavilions at the World Expo in Shanghai, including China's, Japan's, Australia's, London's and Madrid's. He also took in a pavilion set up by Chinese private enterprises and yesterday morning spent over an hour at the much-criticised Singapore pavilion, accompanied by Acting Minister for Information, Communications and the Arts Lui Tuck Yew and tourism officials.
Mr Goh said Singapore's was a 'commendable effort' but 'on having visited the other pavilions, I'm sure it could have been done better'.
He said he would have preferred it if the organisers had focused on the future of Singapore as well as reduced the presence of sponsors' logos at the site, noting that banners and signs were large and jarring and took up valuable space which could have been used for attractions. 'The reality is better than what we could show (at the pavilion) so naturally you would be a little disappointed,' he said, but noted that resources allocated were necessarily limited.
First, who is the majority shareholder in Keppel Corp? Isn't it the government? Doesn't Temasek belongs to the Singapore government? So the government expects quick returns from Keppel, but allow Temasek the luxury of long-term holding.
Second, to expect returns within 3 to 5 yrs from a project of this size and nature is unrealistic even for a private venture. If Keppel had done it's feasibility study, it would know the economic horizon of this venture, and would not have undertaken it in the first place. So why did they?
I suspect that these reason are just bullshit to justify giving Singbridge a leg up into China.
But what is really uneasing is SM Goh spilling the bean that the billions that the PAP government had poured intp Suzhou and Tianjin was based on gut feelings without any economic feasibility study done. This is done so that the PAP can stay "engage" with the communist chinese government. What can be more disturbing than this?
http://www.businesstimes.com.sg/sub/news/story/0,4574,393217,00.html
Why Temasek took China project
Public company shareholders more impatient for returns: SM Goh
By CHEW XIANG
IN SHANGHAI
TEMASEK Holdings took over Keppel Corp's stake in the 'knowledge city' project in Guangdong because it could take a longer view while public company shareholders are impatient for immediate returns, Senior Minister Goh Chok Tong said yesterday.
Speaking in Shanghai at the end of a three-day working visit, Mr Goh said the project could be the first of a 'new model' of China-Singapore collaborations, which would be led by private companies like Temasek.
Both countries' governments have worked together on previous large-scale industrial and development projects in Suzhou and Tianjin, but the new 'knowledge city' in Guangzhou city, in Guangdong province, will be led by the private sector instead.
Keppel Corp, which is taking an active role in the Tianjin eco-city now under development, was also initially involved in Guangzhou but its stake was taken over last year by newly created Temasek subsidiary Singbridge International.
'Keppel did so for Tianjin because (former Keppel chairman) Mr Lim Chee Onn could see the larger strategic purpose for Singapore and for the company,' Mr Goh told reporters yesterday. 'But I think even Keppel would not want to do the 'knowledge city',' he said, noting that returns could take three to five years, a long time for public companies impatient for immediate returns on investment.
Mr Lim is now chairman of Singbridge, while its chief executive is former Economic Development Board managing director Ko Kheng Hwa, who had first joined Mr Lim at Keppel in 2008.
Singbridge has committed to invest two billion yuan (S$411 million) in the initial stage, with a Chinese joint venture partner, a unit of the Guangdong Development District, contributing a 123 sq km plot of land and undertaking infrastructure investment to connect the new development to the rest of the province.
Mr Goh and Guangdong party secretary Wang Yang officiated at a groundbreaking ceremony on Wednesday at the 'knowledge city' site 35 km north-east of Guangzhou city centre.
Yesterday, Mr Goh noted that for the industrial projects in Suzhou and Tianjin, 'on the government-to-government side, we did not do an economic feasibility study'.
'We just felt in our guts that this was something good to do to engage China and that you could make it work,' he said. But Singbridge's present involvement means Guangzhou's 'knowledge city' would be undertaken purely for profit.
'We are commercialising our public sector experience through Singbridge, so we are now able to unlock the value of the civil service for projects like this,' Mr Goh said.
However, Singapore will always take priority in terms of civil service resources, he added.
The 'knowledge city' development is seen as a testbed of the province's ambitious plans to upgrade its economy by shifting to higher-end manufacturing, high-tech industries and research and development. Guangdong has been a centre of China's low-cost manufacturing for decades but wage pressures and increasing labour unrest are eroding its competitive advantage.
Electronics manufacturing giant Foxconn confirmed yesterday that it plans to relocate major production lines from Shenzhen to Langfang in Hebei province to save costs.
Singaporean involvement in Guangdong, and China generally, in such projects would help it stay relevant to its much larger Asian neighbour for the next 10 to 15 years, Mr Goh said. 'The day is already here where we learn from one another,' he said. 'Ten to 15 years from now I think we will be coming here to learn (from the Chinese).'
During his working trip, Mr Goh also visited eight pavilions at the World Expo in Shanghai, including China's, Japan's, Australia's, London's and Madrid's. He also took in a pavilion set up by Chinese private enterprises and yesterday morning spent over an hour at the much-criticised Singapore pavilion, accompanied by Acting Minister for Information, Communications and the Arts Lui Tuck Yew and tourism officials.
Mr Goh said Singapore's was a 'commendable effort' but 'on having visited the other pavilions, I'm sure it could have been done better'.
He said he would have preferred it if the organisers had focused on the future of Singapore as well as reduced the presence of sponsors' logos at the site, noting that banners and signs were large and jarring and took up valuable space which could have been used for attractions. 'The reality is better than what we could show (at the pavilion) so naturally you would be a little disappointed,' he said, but noted that resources allocated were necessarily limited.
