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Financial Times - Nepotism In Singapore Government & GLCs

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  • sg_review@yahoogroups.com
    Current or former PAP MPs have often been appointed as executives or directors of GLCs, while GLCs have also served as recruitment grounds for the PAP.
    Message 1 of 1 , May 1, 2004
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      "Current or former PAP MPs have often been appointed as executives or
      directors of GLCs, while GLCs have also served as recruitment grounds
      for the PAP."

      "Senior government officials and military commanders have also secured
      posts in the GLCs after retirement."

      http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1083180217836

      Singapore issues rules to prevent 'crony capitalism'
      By John Burton in Singapore
      Published: May 1 2004 5:00
      Financial Times

      Singapore has issued new rules that increase oversight on government
      lawmakers serving as company directors, in an effort to prevent the
      emergence of "crony capitalism" in the city-state which prides itself
      on its integrity.

      Goh Chok Tong, the prime minister, said members of parliament with
      the long-ruling People's Action party must submit annually a list of
      their directorships and the total fees and stock options they receive.

      PAP MPs have found company directorships a lucrative sideline, with
      some sitting on as many as 11 boards and receiving fees of up to
      S$70,000 ($41,000, €34,000, £23,000) from each company.

      There are suggestions that private companies have sought the MPs as
      board members to gain influence with the PAP, which has ruled
      Singapore since 1959 and holds all but two seats in parliament.

      Mr Goh warned that "some companies may do so, hoping that this will
      facilitate their business inter-actions with the government or lend
      respectability to their operations".

      But some analysts believe private companies have little choice in
      currying favour with government MPs to gain a foothold in an economy
      dominated by state-owned companies.

      The PAP's political dominance and the high salaries offered for
      government posts to discourage corruption has drawn Singapore's
      brightest to the public sector and ruling party, depriving private
      business of the best talent.

      Mr Goh said the new guidelines on MPs' involvement in business would
      help improve transparency and draw a clear line between political
      duties and private interests.

      "The MP should also consider the possible impact that the
      directorship may have on his political life," the guidelines stated.

      There are suggestions that the PAP should place limits on the number
      of directorships an MP can hold.

      A survey by the Singapore Straits Times newspaper found that a large
      number of PAP MPs had been approached for board directorships and
      demand was rising due to an increased number of initial public
      offerings.

      The guidelines said MPs should not solicit for directorships as they
      may appear to be using their political position for personal gain.
      But the guidelines appeared to fail to address the close involvement
      of government MPs and other officials in state-owned companies, or
      government-linked companies (GLCs) as they are known in Singapore.

      Current or former PAP MPs have often been appointed as executives or
      directors of GLCs, while GLCs have also served as recruitment grounds
      for the PAP.

      Senior government officials and military commanders have also secured
      posts in the GLCs after retirement.

      Mr Goh, for example, was managing director of Neptune Orient Lines,
      the state-owned shipping line, before he entered politics, while
      David Lim, a former government minister, was recently named as NOL
      chief executive.

      This has led critics to suggest that the government is reluctant to
      privatise GLCs because it could hurt the employment and ownership
      interests of people closely connected to it.

      ----------------------------------------------------------------------------------------


      From: "apsonlim" <apsonlim@...>
      Date: Wed Aug 13, 2003 6:15 am
      Subject: Why it is difficult for govt to withdraw from business

      Please click on this link for a comprehensive data of who's who in
      GLCs.
      http://www.singapore-window.org/sw02/020210gl.htm

      Why it might be difficult for the government to withdraw from
      business

      BY Tan Boon Seng

      February 10, 2002

      Singapore Window obtained this documentation. As far as we know, the
      information is correct.
      IF readers know of any inaccuracies please contact the webmaster.


      GOVERNMENT-LINKED companies (GLCs) appear to be playing a bigger
      role in the Singapore economy than ever before. With Singapore
      experiencing possibly its worst economic downturn since
      independence, the government is re-examining its economic policies.
      The government's deepening and broadening involvement in private
      enterprise is among the policies being scrutinized by the
      government's Economic Review Committee. Some officials hint at a
      reversal of this practice but others appear to disagree.

      A closer look at the issue suggests that reversing this policy is
      difficult. The government's withdrawal from business could hurt the
      employment, income and ownership interests of people closely
      connected to it –

      1)relatives of senior government leaders,

      2)former senior government officials,

      3)former senior military commanders,

      4)current senior government officials, and

      5)current and former ruling party politicians. The outcome may also
      hurt the government's efforts to co-opt its politicians from the
      private sector.

      The Policy Debate

      ]Minister of State for Trade and Industry Raymond Lim in November
      said that the government might in future do less of "leading from
      the front". He also suggested the possibility of introducing
      competition law to address the dominance of GLCs. Mr Tharman
      Shanmugaratnam, Senior Minister of State for Trade and Industry, in
      December said that: "What really matters for East Asia is a shift
      towards open, competitive markets, and away from the state-driven
      industrial policies and the collusive domestic networks that have
      led to low returns on investment."

      However, Deputy Prime Minister Brigadier-General Lee Hsien Loong,
      who is heading the Economic Review Committee, has clarified the
      extent to which the government will withdraw from business. He said
      GLCs would continue to be "one of the thrusts forward" for the
      Singapore economy. His wife, Mdm Ho Ching, who is Director of
      Temasek Holdings and Deputy Chairman of Singapore Technologies, has
      shared her dream for Singapore Technologies to become a "global
      champion", "to make the seemingly impossible, a reality". Mr S
      Dhanabalan, Chairman of Temasek Holdings, has also made it clear
      that the government will not withdraw from businesses it deems it to
      have a "strategic" interest in. Mr Dhanabalan said the government
      also intends to be involved in businesses of a high-risk nature.
      These remarks were made even before the committee's work had begun.

      http://www.singapore-window.org/sw02/020210gl.htm
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