Economy & business — Topics

12 Aug 2013

Companies Participating in Travel Smart Scheme

The Travel Smart scheme currently involves 12 companies with 25,000 employees, each receiving up to $20,000 in subsidies to implement initiatives like flexi-work and cycling facilities, with a review scheduled for early 2014 to plan expansion.
The Ministry plans to customize travel incentive programs with participating organizations to encourage employees to shift travel times outside peak periods, but no specific target number of participating companies has been set yet.
Additional incentives include the Work-Life Grant under the WorkPro program, which offers up to $160,000 to support employers in implementing flexi-work arrangements to improve work-life balance and spread commuter load.

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12 Aug 2013

Implementation of Capital Gains Tax for Foreigners Purchasing Private Housing in Singapore

Mary Liew proposed a capital gains tax on foreigners buying private housing to curb rising prices.
Khaw Boon Wan highlighted that cooling measures have slowed price growth and reduced foreign buying, with prices rising only 1.6% in the first half of the year and foreign purchases dropping from 18% to 8% of total transactions.
The Minister stated the Government has no plans to introduce a capital gains tax but will continue monitoring the market to ensure affordability for Singapore Citizens.

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12 Aug 2013

Foreign Educational Institutions Receiving Financial Incentives from EDB

Mary Liew asked about the number of foreign educational institutions that received financial incentives from EDB, the total amount offered, and whether there was recourse for failed ventures.
Lim Hng Kiang stated that since 1999, EDB provided $73 million in grants and $172 million in loans to 11 foreign educational institutions, with support calibrated to expected benefits for Singapore.
EDB monitors institutions through regular reviews and financial statements, and may require grant returns based on progress and contributions if an institution terminates operations.
All loans must be repaid regardless of whether an institution stays or leaves Singapore.

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12 Aug 2013

Number of New Investments in Aerospace Industry

The aerospace industry in Singapore achieved a record output of S$8.7 billion in 2012 and employed 19,900 people, with 80% being locals and 90% of jobs skilled.
Since the start of 2012, eight new aerospace facilities have opened and six more are under construction by major companies like Bell Helicopter, Cessna, Bombardier, Pratt & Whitney, and Rolls-Royce.
These 14 investments are projected to create over 1,500 new jobs in Singapore at steady state.

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12 Aug 2013

Subsidiaries of Statutory Boards Appointed as Vendors for Government Contracts

The Singapore government has 105 subsidiaries set up by statutory boards and ministries to perform functions in areas like security, education, healthcare, R&D, and the arts, and these subsidiaries are generally divested once their objectives are met.
Over the past five years, 0.8% of public sector tenders were awarded to these subsidiaries, with less than one-fifth of those contracts awarded by their parent statutory boards or ministries, mostly for R&D and prototype studies.
The government emphasizes that procurement requires a level playing field for all bidders, with tenders evaluated and awarded based on the best value-for-money offer, and any unfair treatment is considered improper.

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12 Aug 2013

Stress Tests for Banks in Singapore

MAS conducts annual stress tests on all local and major foreign banks in Singapore, with more frequent tests possible during crises, and completed a test using end-2012 data that showed the banking system remained sound.
The results indicated that local banks have sufficient capital buffers to withstand severe stress scenarios, with credit rating agencies affirming strong ratings albeit with a negative outlook for Moody’s.
MAS does not publish stress test results to protect confidential information and avoid incentivizing narrow risk management, but the public can access other sources like the Financial Stability Review and bank reports to assess risks.

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12 Aug 2013

Singapore's Private Banking Sector

There are currently about 40 financial institutions offering private banking services in Singapore, which is recognized as a leading international centre for this sector.
The growth of Singapore's private banking sector is successful, supported by strong regulation, rule of law, political stability, a robust ecosystem of talent and capabilities, strategic location in Asia, and developed capital markets.
The sector employs about 9,000 people, with over two-thirds being Singapore citizens, creating quality jobs in management, client relations, risk management, compliance, and other functions, and efforts are ongoing to develop a strong Singapore core for sustainable growth.

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12 Aug 2013

Export and Import (EXIM) Bank for Singapore

Chen Show Mao asked whether the government would reconsider establishing an EXIM Bank to address SMEs' cross-border trade finance gaps or provide evidence that existing schemes like the Internationalisation Finance Scheme have overcome these challenges.
Lim Hng Kiang responded that the government studied the EXIM Bank proposal but concluded existing schemes under IE Singapore, such as the Political Risk Insurance Scheme and expanded Asian Development Bank programs, effectively address financing needs without the risks of a new institution.
He noted that current schemes already support SMEs significantly, with the government sharing up to 75% of risk, and will continue monitoring their effectiveness.

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12 Aug 2013

Trade and Economic Relations with Myanmar

The Government is actively supporting Singapore companies, including SMEs, in exploring opportunities in Myanmar through seminars, an Overseas Centre in Yangon, and business missions organized by economic agencies and trade associations.
The lifting of EU sanctions on Myanmar, including the reinstatement of the Generalised Scheme of Preferences, provides Singapore companies with duty-free and quota-free access to the European market for products manufactured in Myanmar.
Singapore is a significant investor in Myanmar, with S$4.4 billion in investments as of end-2011, and the Government will continue to deepen economic and trade relations as Myanmar reforms its economy.

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12 Aug 2013

Comparison of Premier League Charges in Singapore and Other Countries

Mr Zaqy Mohamad questioned how Singapore's local subscription cost for paid BPL channels compares with charges by other TV operators in major markets and whether MDA foresees other impacts or inconvenience to consumers due to the cross-carriage measure.
Assoc Prof Dr Yaacob Ibrahim clarified that the cross-carriage measure's intent is not to lower pay TV costs, noting that global premium sports content acquisition costs are rising significantly, with BPL rights costs increasing substantially in markets like the UK, Thailand, and Vietnam.
MDA compared Singapore's BPL pricing in PPP terms with bundled offerings in Malaysia, Thailand, Hong Kong, Australia, and the UK, finding Singapore more expensive than Malaysia and Australia but less expensive than the UK, Hong Kong, and Thailand, with competitive bundles and rebates leading to potentially lower prices locally.
MDA is monitoring the implementation of the cross-carriage measure through the Media Market Conduct Code to ensure no discrimination in customer service and will take firm action against any breaches by pay TV operators.

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12 Aug 2013

Repayment of CPF Funds when Co-owners Withdraw from Co-Ownership

Intan Azura Mokhtar proposed reviewing the CPF policy requiring parents to repay CPF funds used for their children's HDB loans when children withdraw from co-ownership to buy another flat with a spouse or fiancé/fiancée.
Tan Chuan-Jin explained that CPF funds must be refunded to maintain retirement adequacy, with a charge on the property ensuring proceeds from any sale are used to repay CPF principal and accrued interest.
He noted that the refund requirement applies when lifting the charge on a property co-purchased with parents, and the child must repay the CPF funds via transfer, cash, or a loan to proceed.

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12 Aug 2013

Ensuring Places at Tertiary Institutes for Singaporeans

Heng Swee Keat affirmed the government's commitment that no Singaporean student will be denied tertiary education at public universities or polytechnics due to financial constraints.
He explained that all Singaporeans receive a tuition grant covering about 75% to 85% of fees, supplemented by a range of financial assistance schemes like bursaries, loans, and scholarships.
The government has increased bursary amounts and expanded eligibility, while also partnering industries to offer scholarships such as the Singapore-Industry Scholarship (SgIS).

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12 Aug 2013

Naming Rights of Sports Hub

Assoc Prof Tan Kheng Boon Eugene questioned why the 2012 naming rights MOU with OCBC Bank was not approved, seeking better management guidelines and an update on facility naming and revenue, and asking how fair value is ensured.
Lawrence Wong explained that the Sports Hub operates under a PPP agreement where the private operator SHPL manages commercial opportunities without government approval, but requires SSC approval for individual facility names.
The Ministry and SSC rejected a proposal to sell naming rights for the entire Sports Hub, deciding to preserve it as a national icon free from commercial naming, while allowing sponsorship deals for individual facilities.
Assessments for naming rights sales involve independent valuations to determine fair value, and details for individual facility naming are still being finalized.

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12 Aug 2013

Curbing Rental Rises at HDB Coffee Shops

Ms Foo Mee Har questioned the Minister for National Development about safeguards to moderate rental increases for HDB coffee shop tenants amid rising transacted prices for these shops.
Minister Khaw Boon Wan explained that HDB does not intervene in stall rental pricing, as it is a business decision negotiated between eating house operators and stallholders.
The Minister noted that while transacted prices of eating houses have increased, transaction volumes remain low, and new supply from HDB and NEA will help keep stall rentals in check.
He added that the government will closely monitor the commercial properties market and intervene if necessary to prevent speculation and excessive price increases.

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12 Aug 2013

Dependency Ratio Ceilings for New Growth Industries

The Ministry provides limited flexibility on dependency ratio ceilings for new growth industries, but only on an exceptional basis to address temporary skills gaps, and applies strict criteria tied to high productivity and value add.
Various government schemes, such as the Singapore-Industry Scholarship and the Development and Apprenticeship Programme, are in place to promote skills transfer and groom local talent for leadership roles in key sectors.
The Ministry has tightened criteria for Employment Pass and S Pass applications to reduce reliance on foreign talents, resulting in a decline in Employment Pass numbers in 2012, with further measures to ensure fair consideration for Singaporeans to be announced later.

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12 Aug 2013

Impact of Slowdown in China's Growth on Singapore

The Minister noted that while China's economic growth has slowed, the impact on Singapore's exports and tourist arrivals has so far been limited, with non-oil domestic exports to China continuing to rise and tourist arrivals remaining resilient.
A gradual slowdown in China is expected to have limited impact due to Singapore's diversified export and tourist markets, but a sharp slowdown could significantly affect Singapore, especially if regional economies are also impacted.
China is rebalancing its economy toward consumption and services, creating opportunities for Singapore in sectors like urban solutions, consumer goods, and professional services, with many Chinese companies already using Singapore as a regional base.
The Singapore government will support industries through free trade agreements, trade fairs, and agency assistance to help companies internationalize in China and position Singapore as a gateway for Chinese businesses and tourists.

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12 Aug 2013

Quarterly Services Index

Chen Show Mao proposed a new quarterly services index to complement existing monthly manufacturing export figures for timely measurement of services exports in sectors like transport, travel, financial, and business management.
Lim Hng Kiang responded that the Department of Statistics already compiles and releases quarterly services export estimates in line with IMF standards, published in MTI’s economic surveys, and these cover the requested categories.
The exchange highlighted the availability of existing quarterly data for services exports, addressing the need for timely performance calibration without instituting a new index.

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12 Aug 2013

Impact of Malaysia's Temporary Ban on Fish Exports to Singapore

Ms Faizah Jamal raised concerns about ensuring Singapore's food security and supply in light of Malaysia's temporary ban on certain fish exports.
Minister Khaw Boon Wan stated that the ban had minimal impact, as the affected fish species constituted less than 4% of total fish imports in 2012, and importers sourced alternatives from countries like Thailand and Vietnam.
He highlighted that Singapore's food supply remains resilient due to a diversification strategy, importing over 100 fish species from more than 60 countries to buffer against shortages and price volatility.

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12 Aug 2013

Jobs for Singaporeans

Members of Parliament raised concerns about ensuring fair consideration for Singaporeans in hiring, including extending dependency ratio ceilings to Employment Pass holders, reviewing the Employment Pass framework, and introducing labour market testing to prioritize local talent.
The Acting Minister for Manpower emphasized the need to balance protecting Singaporean core workforce interests with maintaining competitiveness, citing international consultations, public feedback, and industry discussions that highlight the risks of overly rigid policies and the importance of merit-based hiring.
The Ministry is working on a framework to reinforce responsible hiring practices without being overly prescriptive, aiming to level the playing field while encouraging Singaporeans to upgrade their skills to meet job demands and support economic growth.

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12 Aug 2013

Curbing Excessive Borrowing

The government acknowledged concerns about rising household debt but asserted that Singapore's overall household balance sheets remain healthy, with cash and deposits exceeding debt, and the debt-to-income ratio lower than its peak a decade ago.
A segment of borrowers, estimated at 5-10%, is considered over-leveraged with debt servicing burdens above 60% of income, primarily due to housing loans, but most are high-income individuals with single loans, reducing immediate default risk.
The government has introduced proactive measures such as loan-to-value limits and tenure curbs for car loans, and new rules on unsecured credit to restrain imprudent borrowing and manage household debt.
Officials emphasized ongoing vigilance, including monitoring interest rate normalization impacts and preventing credit-driven property price surges, while noting the resilience of both macro and micro household financial positions.
The discussion highlighted the need for prudence in lending and borrowing, with a focus on avoiding complacency despite the current stability of household balance sheets.

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