Necessity of Not Publishing Total Assets under GIC's Management to Defend the Singapore Dollar against Speculative Attacks

Debated in Parliament on 3 Oct 2023.

Summary written by AI (learn more)

Gerald Giam asked if it is still necessary to keep the total assets under GIC's management unpublished given that official foreign reserves already exceed the typical range needed to defend the Singapore dollar.
Lawrence Wong explained that reserves must be sufficient for both routine exchange rate defense and extreme tail-risk scenarios, including large capital outflows or emergencies that threaten national security.
He emphasized that disclosing the full size of reserves could undermine Singapore’s ability to deter speculative attacks, similar to how military capabilities are kept confidential to protect national interests.

Questions identified by AI (learn more)

Full Transcript

Gerald Giam Yean Song

Mr Gerald Giam Yean Song asked the Deputy Prime Minister and Minister for Finance as the Official Foreign Reserves (OFR) managed by MAS currently stand at 70% of GDP and the Reserves Management Government Securities held by MAS can bring the OFR to 106% of GDP, whether it is still necessary to avoid publishing the total assets under the management of GIC so as to defend the Singapore dollar against speculative attacks.

Lawrence Wong

The Monetary Authority of Singapore (MAS) has explained that the amount of official foreign reserves (OFR) needed to ensure confidence in Singapore’s exchange rate-centred monetary policy and in Singapore’s macroeconomic stability is between 65% to 75% of GDP. The OFR ensures that MAS has the wherewithal to defend the Singapore dollar against speculative attacks. But we need to prepare for more extreme tail-risk scenarios. That could include a crisis of unprecedented scale that causes an outflow of capital in excess of what MAS holds. It could also be emergency scenarios precipitated by state or non-state actors that threaten our economy and livelihoods or even our existence as a nation. Recent events around the world have underscored that our peace and security should not be taken for granted. Just as our defence forces do not reveal the full extent of our weaponry and military capabilities, it is not in Singapore’s interest to disclose the full size of our reserves.

Summary written by AI (learn more)

Gerald Giam asked if it is still necessary to keep the total assets under GIC's management unpublished given that official foreign reserves already exceed the typical range needed to defend the Singapore dollar.
Lawrence Wong explained that reserves must be sufficient for both routine exchange rate defense and extreme tail-risk scenarios, including large capital outflows or emergencies that threaten national security.
He emphasized that disclosing the full size of reserves could undermine Singapore’s ability to deter speculative attacks, similar to how military capabilities are kept confidential to protect national interests.

Questions identified by AI (learn more)

Necessity of Not Publishing Total Assets under GIC's Management to Defend the Singapore Dollar against Speculative Attacks | PAPERCUTS

Necessity of Not Publishing Total Assets under GIC's Management to Defend the Singapore Dollar against Speculative Attacks

Debated in Parliament on 3 Oct 2023.

Summary written by AI (learn more)

Gerald Giam asked if it is still necessary to keep the total assets under GIC's management unpublished given that official foreign reserves already exceed the typical range needed to defend the Singapore dollar.
Lawrence Wong explained that reserves must be sufficient for both routine exchange rate defense and extreme tail-risk scenarios, including large capital outflows or emergencies that threaten national security.
He emphasized that disclosing the full size of reserves could undermine Singapore’s ability to deter speculative attacks, similar to how military capabilities are kept confidential to protect national interests.

Questions identified by AI (learn more)

Full Transcript

Gerald Giam Yean Song

Lawrence Wong

Summary written by AI (learn more)

Gerald Giam asked if it is still necessary to keep the total assets under GIC's management unpublished given that official foreign reserves already exceed the typical range needed to defend the Singapore dollar.
Lawrence Wong explained that reserves must be sufficient for both routine exchange rate defense and extreme tail-risk scenarios, including large capital outflows or emergencies that threaten national security.
He emphasized that disclosing the full size of reserves could undermine Singapore’s ability to deter speculative attacks, similar to how military capabilities are kept confidential to protect national interests.

Questions identified by AI (learn more)

Necessity of Not Publishing Total Assets under GIC's Management to Defend the Singapore Dollar against Speculative Attacks

Summary

Questions Identified

Full Transcript

Gerald Giam Yean Song

Lawrence Wong

Summary

Questions Identified

Necessity of Not Publishing Total Assets under GIC's Management to Defend the Singapore Dollar against Speculative Attacks

Summary

Questions Identified

Full Transcript

Gerald Giam Yean Song

Lawrence Wong

Summary

Questions Identified