Saturday, 4 May 2013

Watz Buzzing - 4 May 2013

Singapore falls to record-low place in press freedom ranking

Yahoo! Newsroom - Singapore achieved its worst-ever press freedom ranking in an annual report by Reporters Without Borders (Yahoo! file photo)

Singapore fell 14 places to a record 149th position in terms of press freedom, according to an annual report by non-governmental organisation Reporters Without Borders (RWB).

Coming ahead of World Press Freedom Day, which was observed Friday, the report showed this is the city-state’s worst performance since the index was established in 2002.

On the list, Singapore is wedged in between Russia and Iraq, with Myanmar just two places behind. The former junta-led country jumped up 18 spots in this year’s ranking. 

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 Whither Singapore?

There is a statue of Sir Stamford Raffles on the banks of the Singapore River that stares roughly in the direction of the city-state's Parliament. A plaque there, purportedly where Raffles landed in 1819, credits him for having "changed the destiny of Singapore from an obscure fishing village to a great seaport and modern metropolis".

But after some three decades of spectacular economic growth, has the beginning of the end for this island-nation arrived? Many of those who arrive from elsewhere to make a living in Singapore must come to Upper Circular Road, a short walk east of Raffles' effigy. The ministry of manpower hands out those sought-after employment passes here, in a slick, air-conditioned office. Appointments are given online; the offline turnaround time is almost ridiculously short. This is, in many ways, the epitome of the country's efficiency, but increasingly for Singaporeans, also the most significant signal of fault lines that threaten their society.

So significant, in fact, that it triggered one of the largest protest rallies in the city-state's recent history. Some 4,000-5,000 Singaporeans braved the rains this February to demonstrate against a government white paper that projects immigrants constituting about half of the country's population by 2030.

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Singapore No Longer Home to World's Strongest Bank - Bloomberg

Bloomberg, 2 May 2013

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S'pore not cheapest, but must remain competitive

Singapore must continue to uphold its reputation as a competitive and dynamic city worth investors paying a premium for, even if it is not necessarily the cheapest.

This was Prime Minister Lee Hsien Loong's call yesterday at the May Day Rally, in which he said attracting quality investments and creating better jobs are key to growing the economy.

But as the country tightens up on foreign hires, Mr Lee said it has to be "very careful" to remain a competitive place for doing business. "If we make it difficult for companies to get the skills and talent they need, they will go elsewhere," he said.

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Singapore's poor lose out to foreign wealth

Singapore's lower-class citizens are losing out to foreign workers as the affluent move in.
Many wealthy individuals come to invest in property and park their assets, attracted by Singapore's low taxation rate of 20 percent.

The influx of money is making Singapore one of the richest cities in the world. But the low tax rate also means no social security net, given the plummeting wages among the poor as foreigners take up blue-collar jobs. 

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Singapore Must Be Careful Not to Overdo Labor Curbs, Lee Says

Singapore must avoid going too far on foreign-worker curbs to remain competitive in attracting businesses and investors, Prime Minister Lee Hsien Loong said.

The island should be careful not do “overdo” measures to restrict the inflow of overseas labor as it will raise the cost of doing business and make it harder for companies to operate in the city-state, Lee said in a Labor Day speech to more than 1,000 union leaders and members today.

“If we make it too difficult for companies to get their skills and talent which they need here, they will go elsewhere,” Lee said. “Investors are watching us closely. We must not send the wrong signal that Singapore no longer welcomes business or that they are turning away talent.”

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One Step Forward, Two Steps back

PM Lee reiterated his commitment to improve the lives of Singaporeans when he said: “Our economy is maturing, and we are reducing the inflow of foreign workers. But we must continue to create opportunities for ourselves, develop new capabilities and improve the lives of Singaporeans,” in his May Day speech (–inclusiveness–pm-lee-in-may-day-message-012454835.html). While I do not doubt his sentiments, I wonder if the government has truly laid the groundwork to “improve the lives of Singaporeans”.

No doubt, there have been more attempts at engagement but it is unfortunate that strong elements of clamping down on free political expression still remain and the government has shown no desire to eradicate these. The ISA is still retained; there is still no political engagement vis a vis Section 377a; Alex Au ran into some trouble with regards to certain comments left on his blog and the list goes on. The latest being the Nizam Ismail saga. Does PM Lee not realise that improving the lives of Singaporeans goes a whole lot further than mere economic prospects?

Of course, I am not downplaying the importance of economic growth but for the lives of Singaporeans to be truly enhanced, they will need to have the right to freely make their political and social views known. They need to feel heard and be heard by the government they have voted for. More crucially, Singaporeans need to have the security of knowing where they stand with their elected government.

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The important thing about Singaporean public finances and sovereign wealth funds that even most Singaporeans fail to grasp is their absolute centrality to most any economic and even many social issues.  You simply cannot discuss most any major issue in Singapore today without weighing the importance of Temasek, GIC, and Singaporean public finances.

It was with great interest that I recently saw an article entitled “Why Our Saving Rates are Among Highest in the World but We Have No Money for Retirement?”.  The well intentioned author lays the blame primarily at the feet Singapore’s “transformation into an open economy” and “heavy reliance on large multinationals and imported workforce…” but overlooks the most important factor, the role of Singaporean financial policy and specifically GIC and Temasek.  Let me explain.

Let’s take a very simple example to illustrate the point.  Let’s assume that a Singaporean worker started earning an average Singaporean wage in 1980 and earned an average wage every year through 2011 according to IMF and Singapore Ministry of Finance data.  Every year the employee and the employer paid the mandated CPF contributions.  To further simplify, and be generous to the Singaporean government, let’s assume that the savings are earning the highest rate of return of the CPF contributions.  For instance, I assume that current CPF savings are earning 4% rather than 2.5%.  This saves the difficulty of estimating the weighted return percentage and is very generous to the Singaporean government. (I want to emphasize that I am fully aware that 4% is not the primary rate but rather 2.5%.  I want to be extremely generous to the government as the numbers are still quite different).

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Air France Pulls A380s From Singapore to Put on Shanghai Route

Air France (AF)will begin serving Shanghai three times weekly with Airbus SAS double-decker A380s, taking superjumbos off its Paris-to-Singapore line for use on the China route.

Air France serves Singapore seven times weekly, currently four times weekly with A380s and three times a week with Boeing 777-300s. All Singapore flights will now use the smaller Boeing plane, said Ulli Gendrot, a spokeswoman for the airline in Paris.

Air France-KLM (AF)’s policy is to ensure optimum use of its planes in adapting its offer to take into account demand and market context,” Gendrot said in an e-mail.

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Singapore bets on Glencore shares with $250 mln swap

Singaporean sovereign wealth fund GIC is seeking to swap a $250 million portion of its holding in Glencore International Plc convertible bonds into shares in the company, in a vote of confidence as the commodities trader wraps up its takeover of miner Xstrata Plc .
Just days ahead of a May 2 completion date for Glencore's tie-up with Xstrata, GIC, a shareholder in both, said it wanted to sell part of its investment in Glencore's 2014 bond via an accelerated bookbuild.

It said on Monday, however, that it aims to use at least part of the sum raised to simultaneously buy shares in the commodities trader, boosting its existing stake.

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In a twice yearly review, the Monetary Authority of Singapore (MAS) said on Tue (30 Apr) that Singapore’s job market will remain “tight” this year amid the continued tightening in foreign manpower. 

As such, Singapore’s wages will grow at a faster pace in 2013, contributing to higher labor costs and price pressures to businesses even as the economy expands at a “modest” pace.

The Govt has been tightening curbs on foreign workers in response to the low productivity as well as Singaporeans’ increased anger towards Govt’s liberal FT policies over the years. The minimum wage requirement for foreign S-pass holders has been increased from $1,800 to $2,000. Since Sep last year, the Govt has also changed the dependant privileges for foreigners working in Singapore:

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Did the MND review report on AIM transaction answered questions?

Just on Friday, Ministry of National Development released its long awaited review report on the AIM transaction after a further extension from the previous scheduled release date 4 days ago . The review had been called upon by Prime Minister Lee Hsien Loong on 9th Jan 2013 after growing public criticism over the tender for the 14  town councils’ software management contract being awarded to Action Information Management (AIM) Pte Ltd, a company owned by Peoples’ Action Party (PAP)  in 2010.

In the last statement which The Online Citizen released on the AIM transaction in Jan this year, we highlighted a series of problems on the Coordinating Chairman of the PAP’s town councils, Dr Teo Ho Pin’s statement on his clarification for the transaction with the town councils. TOC delivered the same questions from that statement to Dr Teo’s email on 23rd January but we have not heard from him till date.

So looking at the 37 page review report released by MND, have our questions been answered?

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Khaw Boon Wan's Ministry of National Development clears the controversial PAP Town Council-AIM software deal, which PM Lee gladly accepts

Yahoo! News Singapore, 3 May 2013
A probe into the sale of the People's Action Party (PAP)'s Town Council management software to Action Information Management (AIM) has found no evidence of any misuse of public funds.

A report submitted to Prime Minister Lee Hsien Loong by the Ministry of National Development (MND) found that the controversial AIM deal had complied with the Town Councils Act and Town Council Financial Rules.

In its findings, the report stated that the main issue at hand was whether the interests of residents had been protected, if there had been a conflict of interest for the parties in the deal and if there had been any misuse of public funds.

In a press release Lee said that the government "accepted the findings". Full story

  1. PM Lee: I accept the findings of MND review – AIM deal is ok - TR Emeritus
  2. Hsien Loong accepts MND’s review on AIM - My Singapore News
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Every citizen in the world should read this

The Alaska Model: a citizen's income in practice - Politics in Spires: by Karl Widerquist
"You don’t have to be resource rich to have a resource dividend."
 "The most resource-poor countries in the world are probably Hong Kong and Singapore, where millions of people are crowded together on a little island, and they have to import almost all their consumption goods. But these countries have fabulously valuable real estate. I wouldn’t be surprised if a tax on Singapore’s land could support something much larger than the Alaska Dividend."
"Think like an owner. Think like a monopolist. Think like Johnny Carson."
This provides excellent advice on citizen income / unconditional basic income.

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