Rethink regional investment strategy

The Straits Times, March 1, 2007
By Ong Soh Chin


MS Irene Ng believes government-linked companies (GLCs) should reconsider their regional investment strategy in the light of the rising nationalistic fervour in Thailand and Indonesia.

Singapore's Temasek Holdings has considerable stakes in businesses in those two countries - namely Thailand's Shin Corp and Indonesia's biggest mobile telecommunications operators, PT Telekomsel and PT Indosat.

The Tampines GRC MP cited a recent Political and Economic Risk Consultancy (Perc) report on nationalism risks which described Thailand's official anti-Singapore rhetoric as 'bizarrely extreme'.

She said the report also linked the hostility towards Singapore to the negative sentiments against the country's ousted former prime minister Thaksin Shinawatra.

Temasek Holdings had purchased a stake in Shin Corp from Mr Thaksin's family in January last year, setting off massive protests in Thailand which culminated in his ouster in a military coup in September.

Ms Ng also noted that there have been calls in Indonesia for its government to buy back Temasek's Indosat shares.

Indonesia has also slapped a ban on exporting sand, a move directed at Singapore.

Said Ms Ng: 'We have been very restrained, measured and rational in our responses. In the same rational frame of mind, we should take stock and rethink our aggressive regional investment strategy.'

She added that Temasek had invested in Thailand and Indonesia to show confidence in their growth. It did so with a long-term view of not only making them prosper, but also growing together with them.

'But the actions of our neighbours raise the question of whether we should re-prioritise and re-allocate our limited resources.'



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