Singapore's status as a financial hub seems secure as we stand head and shoulders above everyone else, at least here in Southeast Asia, in the realm of international banking. Ours has the look and feel of a successful economy steeped in wealth-management, and purring with maximum efficiency and minimum corruption.
It certainly does not convey the impression of a system under-girded by weaknesses and dangers that threaten its progress. And yet, in reality, our standing as a financial centre is being seriously questioned.
It is a situation that few Singaporeans know - much less care about. But as this three-part series of articles will show, it is a matter that calls for urgent attention because of the change in the global financial climate. It is a matter that will mean much to our economic lives in Singapore.
The present piece traces the recent history of Singapore's build up in asset management and the preeminence we have established for ourselves in the world of finance. It also introduces ominous rumblings that have recently occurred, which look set to get louder, about our operations as a banking centre.
Part II describes the changed mood of the global community, especially with the election of Barack Obama as president of the United States, towards the financial system here and elsewhere, and how Singapore is increasingly viewed.
The third installment discusses how the impending changes will affect our viability as a banking hub and what may be in store for us if our plans to continue as financial centre do not materialise.
With the world reeling from an economic meltdown and gripped by fears of terrorism, it may be a good time for Singaporeans to start paying attention to what others are saying about the way we make our money.
Change laws, make money
At the heart of the issue is how our city-state has worked its way up the financial ladder. Circa 1998 in the wake of the Asian financial crisis, the Government decided to make Singapore the financial capital of Asia, if not the world.
At about that time Switzerland, the Mecca of secretive banking, came under pressure from the European Union to amend its laws to enable greater financial transparency and to provide information to on accounts suspected to belong to tax evaders from other European nations.
The PAP Government saw the opportunity and introduced legislation to tighten up secrecy protections in our financial institutions to attract investors and account holders fleeing Switzerland.
In 2001 Prime Minister Lee Hsien Loong, then deputy prime minister, finance minister and chairman of the Monetary Authority of Singapore all rolled into one, met with bankers from all over the world to discuss how Singapore could tailor its laws to become a premier banking centre.
Following the consultations, he introduced amendments to the Banking Act to revise secrecy provisions so that "only very few exceptions have been allowed for the disclosure of information relating to a customer's deposit and funds placed for investment" and that "a person who receives customer information will be required by law to keep the information confidential." The penalty for breaking such a law is a fine of up to $125,000 or 3-years' jail or both.
In 2004, trust laws were amended to allow foreigners, especially Europeans, to avoid laws in their home countries that regulate inheritance of an estate by family members.
Financial centre or laundromat?
Mr Lee's efforts worked a miracle. Funds from all over the world poured into our banks and financial institutions. At end-2007, the Monetary Authority of Singapore reported that total assets under management reached $1.173 trillion (approximately US$814 billion) up from $150 billion in 1998, an increase of 682% in 10 years. Eighty-six percent of these funds, which include private banking money, came from outside Singapore. Of these 44 percent was from the Asia-Pacific region and 36 percent from Europe.
We may have gotten a bit of help from websites such as the one below which I came across in the course of writing this piece. It is an expensive-looking but curious website called Offshore-Banking-Singapore.com which describes itself as "the leading information portal for high-net-worth individuals and the mass affluent seeking offshore banking services in Singapore." It adds that:
One of the most attractive aspects of Singapore as an offshore jurisdiction is that it has one of the lowest taxation rates in Asia. Non-residents who park their money in Singapore pay no taxes if that money is earned outside of Singapore, and investment gains earned in Singapore (from stocks for example) are also exempt from tax. Singapore is also one of the few offshore centers which was not included in the EU Savings Tax Directive in 2005, an EU initiative to exchange information on EU citizens parking money abroad for tax reasons. In Singapore, not paying taxes owed to foreign authorities is not a crime. In 2004, Singapore amended its trust laws to allow foreigners to sidestep state interference in many European countries which dictates how inheritance is carved up.
The reluctance of those running this operation to be openly identified is perhaps understandable given that it seems to be giving advise on how to circumvent troublesome laws in other jurisdictions, especially Europe.
Can we afford to be Asia's Switzerland?
Such an approach not only attracts foreign funds but also foreign opprobrium. There are more than concerns that Singapore has become a tax haven in the mould of Switzerland, a place where individuals and corporations go to deposit their cash, often to avoid taxation in their own countries.
Not only have tax evaders found a haven in Singapore, money-launderers are also flocking to the city-state. Former chief economist at Morgan Stanley, Andy Xie, wrote in a private email that was inadvertently leaked to the public, said that Singapore's financial success "came mostly from being the money laundering center for corrupt Indonesian businessmen and government officials.''
In 2006, now bankrupt Merrill Lynch and Capgemini reported that the number of "super-rich" Indonesians living in Singapore is a staggering 18,000 whose wealth amounts to approximately US$87 billion. Much of this wealth, complains the Indonesian Government, came from illegal activities in Indonesia.
Xie added that in order to sustain its economy, Singapore was resorting to "building casinos to attract corruption money from China."
Corrupt ruling generals in Burma are also suspected to be stashing their assets in Singapore, leading many to criticise the PAP Government following the Burmese regime's crackdown on monks and civilian protesters in 2007.
Not too long ago, a friend of mine from Cambodia intimated to me a story about four women, all single, from Phnom Penh depositing $80 million between them in Singapore banks. No questions asked.
"Four single women? $80 million? From Cambodia which is dirt poor?" she asked with a mixture if rhetoric and incredulity, "And no one here bothers to ask how they got the money?" In case anyone thinks that the remark carried sexist overtones, my friend was female and a hard champion of equal rights for women.
In a report in 2000, the United States State Department pointed out that the system in Singapore "provided opportunities for money launderers to conduct a wide range of illicit transactions." (The subject of money laundering is discussed in greater detail in my book A Nation Cheated.)
Of course, the Government denies these charges saying that "our banking and financial system is open and transparent, and our rules vigorously enforced."
Perhaps. But the devil is in the fine-print, so they say. In an exchange of emails, Markus Meinzer of the Tax Justice Network (TJN), an organisation calling for greater action on tax havens, told me that "the main and biggest (but not only) problem with the Singapore tax haven legal structure consists in the requirement of an domestic tax interest being present if a request for criminal assistance in tax matters is made."
This means that if a foreign government requests for information on accounts suspected of tax evasion in Singapore, the Government will only cooperate if and only if the case also involves an evasion of tax due to the Singapore authorities.
This effectively puts paid to foreign governments wanting information about their tax fugitives who stash their money in Singapore. Remember what that curious website, Offshore Banking Singapore, was selling? "In Singapore, not paying taxes owed to foreign authorities is not a crime." If it is not a crime in Singapore then no can do, we will not release information about the tax offender.
This problem was highlighted in a case in 2005 involving a former chief of an Italian bank, Gianpiero Fiorani, who was arrested in Milan for suspected misappropriation of funds. Fiorani had then shifted some of his assets to Singapore through a Swiss bank. The Wall Street Journal reported that when he was questioned by the police following his arrest, Fiorani said that he had moved his funds "to better protect the money" and for "peace of mind."
When contacted about the matter the Monetary Authority of Singapore declined to comment.
It is such unwillingness to cooperate with foreign governments and the lack of transparency that has solidified Singapore's reputation as a tax haven. Part II of this article, which will be posted in a couple of days, looks at how tax havens affect the world's major economies, and how these places are fighting back.
Tax havens are not a new phenomenon. They have been around for decades, acting as shelters for wealthy individuals wanting to avoid paying taxes in their home countries. Singapore has gotten in on the business only recently compared to other places.
But since the advent of the financial crisis a few months ago where some western banks have been wiped out and others left on life-support, some governments have hardened their stance towards offshore banking secrecy. As they find themselves bleeding cash, many of these governments are turning to other means to shore up their finances, one of them being to stop tax monies flowing to offshore secret jurisdictions.
The mood changes
In February 2007, a young US Senator co-sponsored a bill with two of his colleagues to stop tax havens from exploiting loopholes in the US tax structure. They rather straightforwardly called the proposed legislation the Stop Tax Haven Abuse Act.
The proposed legislation describes how Offshore Secrecy Jurisdictions, or tax havens, undermine the integrity of the US tax system, robbing the Treasury of more than US$100 billion each year. It aims to "shut down a lot of these abuses." These jurisdictions, the bill claims, "make it nearly impossible for U.S. authorities to gain access to needed information."
At that time, the young senator said about the legislation: "This is a basic issue of fairness and integrity. We need to crack down on individuals and businesses that abuse our tax laws so that those who work hard and play by the rules aren’t disadvantaged.”
In November 2008, this senator was elected President of the United States. Now President-elect Barack Obama seems intent to crackdown on international tax havens when he assumes power on 20 January 2009. He is expected to introduce wide-ranging tax-reform laws "within weeks" of taking office that "could end years of financial secrecy that have protected the super-rich and international businesses as they move money from one jurisdiction to another."
The US is not the only country intent on resolving the tax haven problem. In 2005 the European Union adopted the Savings Tax Directive to combat taxes lost to tax havens. European countries like Austria, Luxembourg and, of course, Switzerland have come under pressure to stop their tax haven practices.
The Organisation for Economic Co-operation and Development (OECD) is also hot on the pursuit of tax havens. The OECD lists four factors to determine if a jurisduction is a tax haven or not:
- Whether the jurisdiction imposes no or only nominal taxes.
- Whether there is a lack of transparency
- Whether there are laws or administrative practices that prevent the effective exchange of information for tax purposes with other governments on taxpayers benefiting from the no or nominal taxation.
- Whether there is an absence of a requirement that the activity be substantial
"The political climate on the issue of tax havens has changed dramatically over the past three months," says Jeffrey Owens, director of the Centre for Tax Policy Administration at the OECD. Owens has spearheaded the organisation's drive to crackdown on international finance secrecy for more than a decade and says that the financial crisis has intensified the attack on havens.
At the G20 summit convened in Washington DC last month, leaders there agreed that the matter of tax shelters "should be vigorously addressed." They pledged to cooperate on international regulation of the financial system which included a promise to work together to "protect themselves against 'noncooperative' offshore tax havens."
They also wanted to impose controls on hedge funds and ratings agencies, and also "force all the world's secrecy and tax havens to cease and desist their resistance to disclosure."
French President Nicolas Sarkozy said: "We are in the 21st century and the French view is that we cannot continue into the 21st century with a system established in the 20th century." He wanted more regulation of the international finance -- including tax havens.
Germany's De Spiegel reported Chancellor Angela Merkel as saying: "We want to further develop policies against tax havens and will support France in this during the [EU] presidency," said Merkel. And this was in April 2008 before the financial meltdown.
The international effort seems to be producing results. Last month clients of top Swiss Bank UBS buckled under pressure and agreed to cooperate with the US Inland Revenue Service to pay back taxes evaded in past years. In return, the US tax authorities would grant the offenders amnesty and not proceed with criminal prosecution. It is believed that some 20,000 US citizens have worked with bankers at UBS to avoid paying taxes.
Singapore not far away
As the squeeze on traditional tax shelters like the Isle of Man, Cayman Islands and Switzerland intensify, tax evaders are moving their money to Singapore which many say is one of the last holdouts against the global drive for transparency. While some jurisdictions may be moving towards becoming more transparent (for example Aruba, the Dutch Antilles, the British Virgin Islands, Bermuda) and others have made political commitments to do so (Cayman Islands and the Bahamas), Singapore has been adamant in its non-cooperation.
In fact, as described in Part I, the Singapore Government has played the role of Switizerland's heir apparent to perfection, energetically persuading the wealthy from all over the world to come and park their funds here.
The PAP disavows such a claim. "Singapore is not a tax haven," Foreign Minister George Yeo insists, "We are a low-tax country but not a tax haven. We're an international financial centre so banking secrecy is very important. It is protected by law. But at the same time we do not condone drug money or terrorism money or money laundering -- these are crimes."
But the world doesn't seem to believe him. US Senator Carl Levin, one of the three co-authors of the Stop Tax Haven Abuse Act, lumped Singapore with the world's leading tax havens. The American lawmaker said of his proposed bill: "In effect, tax havens sell secrecy to attract clients to their shores. They peddle secrecy the way other countries advertise high quality services. That secrecy is used to cloak tax evasion and other misconduct, and it is that offshore secrecy that is targeted in our bill." He identified a list of 34 jurisdictions as tax havens:
- Antigua and Barbuda
- British Virgin
- Cayman Islands
- Cook Islands
- Costa Rica
- Hong Kong
- Isle of Man
- Latvia Lichtenstein
- St. Kitts and
- St. Lucia
- St. Vincent and
- the Grenadines
- Turks and Caicos
Forbes magazine reported that the OECD had named four countries Austria, Luxembourg, Switzerland and Singapore that were not making sufficient effort to counter tax evasion and still had retained restrictions on access to banking information for tax purposes.
Another report added: "Interestingly enough, Singapore is the jurisdiction that has been favoured by many seeking to remove assets from the European Union and the other nations that signed up to the EU Savings Tax Directive." It warned that Singapore needs to be careful how it pushes the boundaries of secretive banking as "the influence and far reaching authority of the Organisation for Economic Co-operation and Development should never be underestimated."
The EU itself is exerting pressure on Singapore to lift its shield on information on European tax evaders. Germany's foreign minister was in Singapore earlier this year and had a "heated debate" on the subject of tax evasion.
"The subject is being discussed with a certain amount of emotion in Germany, and rightly so," the German minister said at a news conference, "because (European) states are losing substantive assets when large entities avoid being taxed. I trust this is being understood here. In questions of tax law and tax secrecy Singapore and the European Union are not always of the same opinion. About that we unfortunately have to talk about."
Even the chairman of the Swiss Bankers' Association, Mr Urs Roth, is pointing (hypocritical) fingers at Singapore. Comparing his country and ours, Mr Roth noted that Singapore's banking secrecy provisions are even stronger than the ones in Switzerland. He pointed out that while Singapore is not getting as much attention at the moment compared to Switzerland "I would guess that it is a question of time."
Jeffrey Owens of the OECD summed up the matter for Singapore most cogently: "The political climate is changing and I do not think that Singapore is correctly reading the political signs that a change is about to come."
(Conclusion of this analysis will discuss how the PAP's move towards turning Singapore into a tax haven has hurt Singaporeans and Singapore's interests.)
In Part I of this article, I talked about how Singapore came to establish itself as a tax haven and money-laundering hub. Part II discussed how we were increasingly coming under the spotlight of the international community for indulging in such activity. This third and final installment examines whether foreign funds parked here have benefited Singaporeans and why we should discontinue the practice of being an offshore secrecy centre as an economic strategy.
But why should Singaporeans care? Isn't it good that we have become fabulously rich from all the money pouring in to our banks? Clean money, dirty money, it's still money. We get to use it and that's all that matters.
Unfortunately, that's not all that matters. Building our nation up as a secretive tax haven is neither good politics nor good economics. The strategy is, at best, risky and, at worst, downright dangerous for Singaporeans both on the domestic and international fronts.
Second class citizens
Let's start with the domestic scene. From an economic standpoint, does becoming an offshore banking centre really benefit Singaporeans? We see the ultra-luxurious property at Sentosa Cove, the Bentleys and Maseratis zooming around on our streets, and immediately think that Singaporeans are more than a fortunate lot.
Not quite. Such trappings are built for and owned by overseas financial magnates whom the PAP Government so desperately craves. But while these super-rich foreigners live it up here Singaporeans, especially those in the lower income bracket, see their fortunes go in the other direction.
For all the hoopla about our economic prowess, we have an income disparity that is akin to those of Third World countries: Our Gini coefficient among employed households, a measure of income inequality, has been rising through the years. Its figure of 48.5 is between developing countries like Argentina (49) and Ecuador (46), and almost double that of European countries like Sweden, Denmark and Germany. It is even higher that those of Japan, South Korea and Taiwan (non tax haven Asian economies) which have Ginis around the mid-30 mark.
Between 1998 and 2003, the average household monthly income of the poorest 20 percent of the population decreased by nearly 15 percent while the richest 20 percent increased by 11.7 percent. In that same period, while the average wage dropped for the poorest 40 percent of households, their expenditure continued to outstrip their income.
Indeed expatriates love Singapore, ranking our country "one of the least stressful places in the region." In fact, the quality of life is so good that in 2007 foreign businesspeople found Singapore the best place in the world to live.
Locals, on the other hand, find the city one of the most stressful places o live in. As a result, among the various Asian societies, Singaporeans are most likely to have suffered depression, stress, and fatigue. Another study showed that job-related stresses continue to be the biggest problems for working Singaporeans. Because of the system, an increasing number of adult Singaporeans are driven to seek the help of mental professionals due to financial woes. Marriages are also being torn apart because of economic pressures at home. This subject is discussed in greater detail in A Nation Cheated.
The stark difference in lifestyles between the wealthy expatriate and the indigent Singaporean is perhaps best characterised by Carol John and Madhupati Singhania. Ms John, a Singaporean housewife, struggles on $700 a month. She goes to bed at night in a one-room flat with her three young children sleeping on thin mattresses on the floor.
"I can't save anything, it's so difficult for me," John says in a report by Reuters. "We don't benefit at all from the economy. As far as I know, my husband's pay hasn't gone up."
Contrast this with Mr Singhania was attracted to Singapore's grandiose living standards for foreigners. He bought a luxury yacht costing him $435,000. He wants to buy a bigger one for $1.3 million.
"You've got everything you want in Singapore,” he says, "you want to buy a fast car, you want to buy a big boat, you want to buy an aeroplane, whatever you need, you can get in this country."
Who really benefits?
But why be so concerned about rich people putting money into Singapore, a reader of this website asked? Can anyone who puts money into our pockets for safekeeping harm us? The simplest answer is yes.
With the explosion of foreign funds in Singapore came inflation. Many will remember how property values skyrocketed earlier this year. Rental, both for office as well as residential space, doubled overnight in some areas. And with restrictions on foreigners purchasing property scaled back, property sale prices also ballooned.
The escalation of property prices increased inflationary pressures. The Consumer Price Index hit 6.3 percent in the recent past, a record high in more than a quarter of a century, wiping out gains made in income increase of about 3 percent. Of course other factors, such as oil prices, contributed to the increase in prices but there is no gainsaying that the influx of wealthy foreigners played a major hand in adding to inflationary woes.
What about jobs? Doesn't increased wealth mean more jobs for Singaporeans? Yes and no. More jobs are created when foreign funds come in but many of these jobs don't go to Singaporeans. In 2007, more than 60 percent of the jobs created went to foreigners. As of that year, one in three workers in Singapore were not Singaporeans.
Other repercussions are less obvious. Take the recent F1 grand prix held here for example. There was never a doubt for whom the event was catered. With tickets going for as much as $1,000 and more (luxury suites were priced at $8,000), the average Singaporean was decidedly not the target spectator. And yet Singaporeans were stuck with the bill. The three-day racing extravaganza cost US$105 million to host and the Government committed us to paying 60% of this amount -- for the next five grand prixs. Retail businesses that were caught within the cordoned-off racing circuit suffered severe losses in revenue and were asking for compensation from the authorities. Hotels on the circuit front were under-booked.
"The only person who walked away from the race with a smile was Bernie Ecclestone," a correspondent told me recently. "It's just not a money-making enterprise for anyone except its owner."
Ethics-shmethics. Money is money
It is silly to bring in the issue of morality and ethics in business, some say. The name of the game is to get rich and namby-pamby notions like morality and ethics have no place in such an important the race. Tax haven money or no, it is still funds that we desperately need.
In the first place, Singapore does not need such funds to survive. We want them to make ourselves glamourous. Needs and wants are two different things.
In the second place, ethics has everything to do with the business. The misery that retail investors are suffering over the toxic minibonds that became worthless overnight when Lehman Brothers went bankrupt is a good reminder that morality plays a large part in how we run financial systems. It was the avarice of bankers that led to the collapse of the financial system as we know it. If it needs to be said again, greed and unethical practices are not good motivators of wealth-making. Yet, these are what Singapore's financial system has come to depend on as we get deeper into becoming a tax haven and financial laundromat.
Of course the PAP policymakers are all for turning Singapore into an offshore banking centre; they benefit mammothly from the strategy. By encouraging money to be parked in Singapore, banks here engorge themselves with money. Top bankers reap the dividends and pay themselves huge salaries and bonuses. By pegging their salaries to the biggest earners in the country, PAP ministers strike the mother lode. In 2007, the ministers upped their salaries by 85 percent.
While becoming a top financial centre may be good for the eilte, both local and foreign, it does little in terms of creating jobs in the numbers that would significantly benefit the people.
The Government made the decision to turn Singapore into a tax haven because it was the easy thing to do. All it needed was some skilfull rewriting of the law and a handsome advertising campaign to lure big, and often dirty, money to our banks of which the Government itself owns a goodly portion. The Wall Street Journal reported that that Prime Minister Lee Hsien Loong "has personally overseen the city-state's private-banking push."
As a result, the number of private banks operating in Singapore nearly doubled from 20 to 35 between 2000 and 2005. Credit Suisse moved its international private-banking sector to Singapore from Zurich. A banker said that Singapore "will be the fastest growing offshore private-banking centre in the next five years."
Of course the alternative economic strategy, as discussed below, is not politically viable, at least not for the PAP. Fostering dynamism and creativity means having to open up the political space which the PAP is loathe to do. The combination of making money on Easy Street while remaining solidly authoritarian was an opportunity too delicious to pass up.
In the meantime, however, the other sectors of our economy continue to languish. Our non-oil domestic exports which account for about 70 percent of gross domestic product plunged in the second half of the year. Exports, led by electronics and pharmaceuticals, fell 15 percent in October while industrial production dropped 13 percent. We continue to find it hard to compete in the manufacturing sector because we have become too expensive and, at the same time, lack the innovative know-how to come up with new products and services that the world will buy.
Quite aside from ethical considerations, indulging in offshore secrecy funds is not good politics. When the international community starts putting on the pressure on Singapore to stop its practice, as it is already doing, what do we fall back on as a game-plan for our economy?
To be sure, tax evaders don't only come from wealthy countries. Developing economies are also suffering from the drain of tax dollars to secretive financial jurisdictions like Singapore. Mr Angel Gurria, Secretary-General of the OECD, commented that: "Developing countries are estimated to lose to tax havens almost three times what they get from developed countries in aid. If taxes on assets hidden by tax dodgers were collected in their owners' jurisdictions, billions of dollars could become available for financing development."
Relations with Indonesia, for instance, continue to be rankled by allegations that Singapore harbours tax fugitives and wealthy businessmen who made away with billions of dollars during the financial chaos when Suharto was toppled. The latest accusation (see the post following this one) is that money embezzled from a state account has found its way into a bank in Singapore.
But while rich nations are able to fund programs to address the problems of tax havens, poor countries don't have the same resources. As a consequence, global poverty becomes even more entrenched. The world's opinion makers are beginning to see that poverty on such a scale is a threat to international stability and security. Power-mongering ideologues and terrorists feed on such economic deprivation to cause mayhem. World leaders are awakening to the reality that urgent action is needed to remedy the imbalance.
Add this to the breakdown of the financial system in the US, fueled by the unbridled greed of bankers and brokers in Wall Street, the international mood against tax havens is taking an ominous turn. There is wide recognition that something must be done to rein in a financial system gone wild, and tackling the problem of tax havens is one of them.
Jeffrey Owens, director of the Centre for Tax Policy Administration at the OECD, pointed out that all offshore secrecy centres will face more pressure from industrialised nations as the growing financial crisis forces governments to look for lost tax monies.
Prime Minister Lee Hsien Loong has, rather belatedly, acknowledged that the US may start exerting pressure on Singapore to stop its tax haven act.
Not only are industrialised nations putting the squeeze on jurisdictions that thrive on banking secrecy, poorer nations are also wanting to see such practices eradicated. So the question before us in Singapore is: Do we thumb our noses at the broader world community and continue to rake in the dollars regardless of how much damage we are inflicting diplomatically? If we are going to maintain our stance, are we heading for a head-on collision with other major economies? Unless we are assured that we will come out on top in such a fight, we may want to seriously re-evaluate our position as a tax haven.
In other words, is the PAP's strategy of making us a "financial centre" a viable one?
But what do we do if we cannot continue to get our hands on easy money from tax evaders and money-launderers? How do we remain viable as an economy?
Simple. We do what hard-working, smart, and honest people do.
First, we need to reduce the cost of doing business in Singapore. Our land prices, dictated by the Government, have made it prohibitively expensive for businesses, especially for the locals.
Taxes and levies are another scourge. Whether it is the ERP, GST, foreign workers levy, road tax, radio and TV licence fees, the PAP is squeezing the lifeblood out of people and businesses. Take, for example, the foreign-workers levy. The Government should do away with the tax but ensure that a portion of the amount saved by employers go towards increasing the workers' wages. This way, employer and employee benefit.
We also need to democratise our political economy. This means that Singaporeans must be allowed to become the drivers of economic growth rather than the Government. Private enterprise, and not the GLCs, must lead our economy. If Singapore develops politically and its citizens find their rightful place in society, we will have the foundations of a system that is free and enterprising, one that will stimulate the entrepreneurial mind.
Depending on wealth as an offshore secrecy centre is both economically risky and politically untenable. The benefits from such an arrangement overwhelmingly go to a select few and not average Singaporeans. Let us get back to basics and make our money by working hard. And if we have the good fortune of becoming rich, let it be through our industry and enterprise. Depending on immoral earnings is not the way forward. (30 Nov 2008)