Singapore to invest up to 30 percent of capital reserves in Asia: Goh
Singapore to invest up to 30 percent of capital reserves in Asia: Goh
LONDON (AFP): Singapore, traditionally an investor in
established capitalist economies, is targeting developing Asian
nations for 20-30 percent of its reserve capital, Prime Minister
Goh Chok Tong said here.
"There is a quiet economic revolution going on in Asia, a
changed attitude toward foreign investors," he told a Singapore
Forum of European and Asian businessmen on Tuesday.
He said Singapore would be looking to Vietnam, India and even
Burma for regional investment opportunities, but primarily to
China, to "bring good returns...a good, black bottom line."
"I believe China will continue with its economic reforms
beyond the year 2000," he said.
"I believe there will be political stability. I know there is
tremendous stress as China moves into a free market economy.
There is high inflation...difficulty in controlling the
provinces...a lack of macro-economic instruments," he said.
"But we are putting our money into China."
Vietnam, said Goh, was another prime target for new
Singaporean investment.
"My sense is that Vietnam will follow in the footsteps of
China," he said.
"Vietnam had a choice of two models to follow: the former
Soviet Union, with its glasnost and multi-party elections, or
China with its economic reforms and restructuring and its strong
political and central control.
"It has chosen the Chinese model. It is moving cautiously and
will study the impact of economic opening in China," said Goh.
He said he envisaged no stunning political reform in Vietnam
in the next decade.
"The Vietnamese leaders are old. Maybe we will see new ones in
10 years, a more open-minded generation prone to economic
reforms. My guess is that Vietnam will open slowly. I don't
expect multi-party elections there in the next 10 years. There
will be a slow development of stability.
Strategy
Singapore, too, would proceed slowly in its new regional
investment strategy, mindful of swiftly changing political winds
and their effect on economies, said Goh.
"We are moving cautiously into these areas," he said. "We are
not putting all our eggs in any one basket. If we invest in five
Asian countries and there is a political setback in one, it will
be offset by the other four."
India, said Goh, "has begun to regulate its economy, not with
the same fanfare or economic impact as China, but it is opening
up. There is no choice for India. It has the potential to be a
macro-economy. But it is no longer with the former Soviet Union
and either it finds new trading partners or it will be left far
behind."
To a complaint from a Singapore-based Italian businessman that
automobiles in Singapore, particularly company cars, were
outrageously expensive, Goh replied: "Singapore is a very small
country. Unfortunately we do not have the space of Italy. So we
had to decide whether we wanted to keep cars moving on the roads,
or turn Singapore into one huge car park.
"If the economy continues to grow, cars will continue to be
expensive. If the economy falls, cars will become cheaper."