Singapore target US$5.35b investments

Singapore target US$5.35b investments

SINGAPORE (AFP): Singapore is on target to achieve its goal of drawing S$7.5 billion (US$5.35 billion) in fixed-asset investments this year, Economic Development Board (ADB) chairman Philip Yeo said.

Yeo, speaking at a news conference Tuesday, expressed determination to achieve his goal of hitting average annual investments of S$10 billion over the next decade in order to constantly update Singapore's industrial base.

"At today's technology, the assets depreciate faster," he said.

Fixed-asset investments totaled S$3.84 billion in the first half of this year, 38 percent higher than the same period in 1995, Yeo said.

The total for all of 1995 was a record S$6.8 billion.

"I think the job for Singapore is going to get tougher every year," Yeo said, citing competition for foreign investment from such emerging and lower-cost locations as China, Vietnam, Indonesia and the Philippines.

Yeo also remained bullish about key industries like electronics and chemicals where the EDB is investing money.

The EDB has the dual role of attracting private investment and putting its own funds into starting up strategic industries, serving as a magnet for private investment and then pulling out when the firms have established themselves.

The EDB currently administers a 1.3-billion-dollar fund, including venture capital, for co-investment programs with multinational and Singapore companies on local and foreign projects.

The EDB has so far poured a cumulative total of S$380 million into 13 projects under the co-investment scheme, compared to S$225 million at the end of 1995, an EDB statement said.

Six more projects requiring very high capital inputs, mostly in chemicals and electronics, are currently under discussion and should be finalized in the next six-to-nine months, Yeo said.

Yeo remained bullish about electronics, which accounts for more than half of Singapore's manufacturing output, despite the current slump resulting from excess inventories and weak demand, particularly in the crucial U.S. market.

He said a recovery was expected to start in the fourth quarter with a projected surge in computer demand during the Christmas holidays.

"We are optimistic. These are industries that go through cycles," he said.