TR EMERITUS

In a few weeks’ time, GST will go up. The PAP government will raise GST by 14.3% (from 7% to 8%) with another similar rise a year later, making a total increase of 28.6%. No matter the compelling and reasoned economic arguments against this rise, no matter the appeals for compassion and the pleas to delay. The PAP government needs to spend, and therefore Singaporeans must pay, that is essentially its explanation for going ahead. They say trust us when we say this package is sufficient, that grants will help, that vouchers will keep the poor afloat. They say believe us when we say any public spending beyond these fiscal rules means drawing on the past reserves, which leaves behind less for the next generation. Singapore’s fiscal position for FY2022 includes a Net Investments Return Contribution (NIRC) of $21.6 billion, yet we are told that the country is still at a budget deficit of $5.4 billion for the year. How are we to trust figures which are shrouded in secrecy? When meaningful detail and transparency remain frustratingly elusive and any attempt to obtain clarity is met with obfuscation and condescension, the questions must keep coming. We are told the NIRC is limited to a maximum of 50% of net investment returns on the reserves. 50% is self imposed and arbitrary. It was set by parliament several years ago. Likewise, it can be changed by a super majority in parliament. Since 9 Aug 1965, the PAP government has amended the Singapore constitution 52 times. How large a reserve would be enough? Why must cash from land sales of all leasehold land that reverts back to the state be excluded from revenues? Why must GST be raised? Quite apart from how the numbers are calculated, government spending needs to be prudent and wise. Equally, the custodians of our monies need to invest with rigorous care. And there needs to be full transparency, and accountability. During GE2015 when GST stood at 7%, PM Lee said: “What would make you need to raise GST? Profligate spending and irresponsible, unsustainable plans.” Could this dire warning have indeed come true?     * Facebook post by Lee Hsien Yang.        Read More →

Many people in Singapore were disappointed that Temasek Holdings invested and wrote down US$275 million in its investment in FTX. There were surprised and shocked to learn, after the collapse, that FTX was run by a team of young, inexperienced people, and there were no proper governance, accounting and risk management practices in place. How did TH carry out its due diligence, and invested a large sum into a a badly run business? This is my understanding of how the venture capital industry works. The people in this industry that invest large funds into startup companies, such as FTX, form a closely knit community. They know each other personally through attendance at international conferences, business introductions and joint investments in ventures. Often, a leading VC capitalist gets to know a startup entrepreneur and decides to fund the startup business. This VC capitalist introduces the startup to the their close contacts in the industry, and probably describes it as "an opportunity not to be missed". The other VC investors line up to get a share of this opportunity. They would probably not carry out their own due diligence, as it would take time, and the opportunity might go to other investors who are willing to decide promptly. I have spent a few decades of my working career in the insurance industry. This is also how the big insurers spread their risk through reinsurance. They follow the leader and take a share of the big risks, often based on trust that the leader has carried out the proper due diligence. The problem with this approach is that the leading VC capitalist that brings to "opportunity" to other investors might have a vested interest, e.g. they are paid a finder's fee based on the investments made by new investors. I do not know for certain if this is the case for FTX, but it might be. The finder fees can be quite hefty, and the payment would probably be considered legal. Nevertheless, I consider it to be a bad practice for an institution to make a big investment based on this practice of following the leader blindly. Many large hedge and institutional funds are involved in FTX. Temasek Holdings was not the leading investor and not the largest investor. I expect that the decision to invest in FTX was not made by the portfolio manager on his own. It probably had to be approved by an investment committee. I would expect that the investment committee would include members of the non-executive board. I found that Temasek Holdings have a Senior Divestment and Investment Committee (SDIC) that comprised solely of the full time management. It does not appear to include the non-executive board directors. The annual report did not disclose the names and positions of members of SDIC. I think that this is a bad practice that needs to be corrected. Some non-executive members of the board should sit in the SDIC. Their role is to check that the full time managers are doing their work diligently. My above view is based on my the information that I was able to obtain, and that information may be incomplete or inaccurate. The government has announced that they will carry out an investigation into this matter. I will wait to read the findings of this investigation. I hope that it will be released in full and quite promptly.   Tan Kin Lian      Read More →

I have to admit that I am not great with languages, even though my social circle at university believed that you were not really educated if you could only communicate in one language and speaking English and something else didn’t count as being bilingual. The only language that operates completely in, is English with German coming a distant second (I speak it well enough to be understood and I can read and write in German but a very basic level.) I can, if push comes to shove, get by in conversational Cantonese (it’s the language I used with my paternal grandma) and Mandarin (thanks to Donald Trump and Brexit, I realized that having some capability of Mandarin would be sensible). However, I am not multilingual and when compared to the guys I was closest with at university, I am a lout. So, to cover the fact that I am uneducated lout who is only operational in English, I developed something of a means of covering this inadequacy – I learnt key words in many languages. So, whilst I don’t speak anything much other than English, I know how to pepper a conversation with many phrases from different languages, thus sounding more intelligent that I actually am. Interestingly enough, this “party gag” of mine seems to work exceedingly well in Singapore, which is officially proud of educating a “bilingual population.” I remember attending a Saudi National Day function and dropping the various Arabic expressions (mainly the ones relating to God). The Saudi’s seemed to appreciate the fact that I was using what little I knew of their language in the right context but more importantly, I actually received an email from a young lady who worked at the Ministry of Foreign Affairs gushing over my command of the Arabic language. This dropping of “foreign” words into the conversation took a particularly interesting turn tonight at a networking function I attended. Ran into an Indian lawyer who works for an international law firm. Although I don’t speak Hindi, I watch enough Bollywood movies to pick up a few words and so I proceeded to use what I had picked up from Bollywood cinema on this chap. Managed to break the ice. Then, he proceeded to do one better by admitting that although he’s ethnic Indian, he’s actually a citizen of Hong Kong and it turns out that his “other languages” are Cantonese and Mandarin. What both of us concluded was the fact that using a language other than your own is a great opener. I think of a speaker at my lower sixth current affairs who mentioned that people become more receptive towards you when they see that you are trying to reach out to them on their terms. I’ve always kept that in mind and although nearly all my negotiations in life are in English, I try, from time to time to say something in another language. It gives the other side the impression that I do understand them. Copyright Hays – When you make the effort to communicate in a language other than your own, you demonstrate a willingness to meet the other side on their terms. I’ve found this especially true in two particular scenarios. The first comes from my days in the Bistrot when European customers came in and I could greet them in German, French or Italian. I like to think that this made me stand out as an Asian boy who realises that White People are actually more than a single group only capable of speaking English and I was rewarded with customers who spent a lot of money with me. The second area comes when I deal with foreign workers in my day job. These guys are usually in a pickle by the time they see me. Dropping that odd word or two in Bengali or Tamil helps give the impression that I am prepared to try to understand them. There is a caveat to this and that is that only works when it comes to a language that nobody expects you to speak. My new friend had a similar life experience growing up. Everyone expects him to speak Hindi. Nobody expects him to speak Cantonese or Mandarin. The same has been true for me. Nobody expects me to know a European language other than English. Nobody expects me to know anything of Arabic or Hindi. Everyone expects me to know Mandarin or, much to my Mum’s annoyance, everyone in Singapore thinks my natural state is Hokkien (minus the usual curse words). Still, that’s no reason not to try and make the effort to communicate in something other than what you’re used to. Linguistic chauvinism has to be the stupidest things around since cigarette smugglers voted to leave the block that made their trade legal. I think of all the idiots yelling “SPEAK ENGLISH – you’re in……” with a sense of pity because it’s a sign that your mind is limited and that is definitely not something to be proud of.   Tang Li *Although I’ve been based mainly in Singapore for nearly two decades, I’ve had the privilege of being able meet people who have crossed borders and cultures. I’ve befriended ministers and ambassadors and worked on projects involving a former head of state. Yet, at the same time, I’ve had the privilege of befriending migrant labourers and former convicts. All of them have a story to tell. All of them add to the fabric of life. I hope to express the stories that inspire us to create life as it should be.      Read More →