S’pore an attractive outsourcing hub: HP

S’pore an attractive outsourcing hub: HP

HP’s Bob Pryor feels the Republic can hold its own against India, writes AMIT ROY CHOUDHURY

DESPITE the growth of India as a major outsourcing destination, Singapore still remains an attractive place to operate out of, according to Hewlett-Packard’s (HP) global boss for outsourcing. Bob Pryor, HP senior vice-president & general manager for outsourcing services, noted that one of Singapore’s biggest plus points is its vibrant and strong labour market. ‘From an economic standpoint the Republic represents a very good place to have a base of operations,’ Mr Pryor told BizIT in an interview last week.

Mr Pryor: He noted that one of Singapore’s biggest plus points is its vibrant and strong labour market and that the Republic is a good place to have a base of operations from an economic standpoint
HP is among the top four global multi-vendor IT solutions and services provider and offers all types of outsourcing services. Globally, it has about 800 outsourcing clients, many of whom are either located in Asia-Pacific or have significant operations in the region. The company has nearly 69,000 professionals, working in 170 countries around the world, engaged in IT services.

Singapore is HP’s Asia-Pacific headquarters and it has around 6,000 employees here.

‘I think Singapore is a very vibrant market in terms of capability; not only to serve the local market but also to serve other countries with skills and expertise,’ Mr Pryor said. The HP official noted that a lot of people ‘have been pretty amazed’ with the success of India in outsourcing and that has created a lot of competition among other countries wanting to become significant destinations for offshore work which can drive higher levels of economic growth.

However, despite this, the skills and competencies available in Singapore ‘as well as the cost base of the employees’ are significant plus factors for doing business here, Mr Pryor noted.

He added: ‘The core infrastructure, network and computing environments that are available in the Republic also contribute a lot to making it an attractive base.

‘Power consumption and cooling (of computer systems) has become an important part of the infrastructure. So having the right environment and core infrastructure to support growth is a key element. The other key factor that Singapore has is what I think is a very stable economic and government environment.’ When asked what other things Singapore could offer to make itself an even more attractive destination, Mr Pryor said: ‘A wish list would include some kind of (financial) incentive that would make it more attractive to move investment and new jobs here.’

One of HP’s biggest outsourcing deals in Singapore is the one it signed with the Singapore Exchange (SGX) in November 2005. Mr Pryor noted that under the deal, SGX outsourced the management of its data centre and IT infrastructure to HP.

Under the contract, HP provides business continuity and availability solutions, service oriented architecture and IT consolidation processes to SGX, he added. Mr Pryor also noted that HP finds the Asia Pacific region a very interesting geography to operate in. ‘It represents two very distinct opportunities. One is from a market perspective and the other is as a low cost, high-value delivery centre.’

As a market, Asia-Pacific is witnessing robust growth in outsourcing services, while HP as a company has been achieving significant growth, Mr Pryor noted.

According to research agency IDC’s IT Services Tracker, outsourcing services during the first half of last year in the Asia-Pacific, excluding Japan (APEJ), grew at a 8.6 per cent annual clip. ‘While we cannot share specific growth figures for HP’s outsourcing services in APEJ, we can say that we have experienced double-digit growth, higher than the market rate in 2007 and are continually gaining market share in our outsourcing business from our competitors,’ Mr Pryor noted.

He added that with the world’s two fastest growing major economies, India and China located in the region, HP expects the growth to continue. The region also represents a robust offshore destination in terms of high level of capabilities and centres of excellence, he noted.

Thus the region is both a market as well as delivery centre, making it exceptionally attractive place to be in, Mr Pryor said.

‘Having very coherent competencies and skills coupled with a cost advantage environment gives the region a huge advantage.’ Mr Pryor noted that late last year, HP signed a significant outsourcing deal with the Indian banking group, the Andhra Bank.

‘Under the deal, HP India will implement a comprehensive core banking solution called Infosys Finance Core Banking Solution, over a five-year period . . . This will enable Andhra Bank to achieve significant cost savings and achieve better business outcomes in the dynamic and competitive banking arena in India.’

Discussing the challenge that companies like HP face in the outsourcing business from Indian outsourcing service providers like TCS and Infosys, Mr Pryor noted that while the Indian companies have a very strong back-end resources in India, their biggest weakness is in domain expertise in customer facing front office functions. ‘In contrast, HP has a very strong front office and heavy domain expertise and we have built global centres of capability to argument our back office capabilities,’ the HP official said.

He however added that these centres of capability are not necessarily all located in India but in other countries as well.

‘We are building capabilities all over the world. Our competence in hardware, servers and services makes us uniquely placed and we put a lot of emphasis on delivery centres,’ Mr Pryor said.

Most of the work we deliver to our clients are located in a centre of some type, either onshore, near-shore or offshore, he added. ‘We have centres all over the world, like in East Europe, India, China, Singapore and Malaysia… It’s all about supporting clients in the place and language of their choice.’
Source : Business Times - 14 Jan 2008

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Subsidies can be on graduated scale: Khaw

Subsidies can be on graduated scale: Khaw

Under means-testing scheme, difference can be just one percentage point
By CHEN HUIFEN

HEALTH Minister Khaw Boon Wan yesterday revealed that the differentiated subsidies for patients with varying incomes could be calibrated on a graduated scale under the means-testing framework his ministry is working on.
And that scale could be narrowly divided, such that the difference in the proportion of subsidy received by two adjacent income brackets could be just one percentage point apart.

‘For example, today’s Class C is 80 per cent (subsidy level),’ explained Mr Khaw. ‘So for those who are classified as low income, they will continue to enjoy 80 per cent (subsidy).

‘And if we decide that it should be reduced to 65 per cent for high income, then in between, we can just have a very graduated scale. In fact with computerisation, it’s no big deal. We can have one percentage point difference. So you have 80 per cent, 79 per cent, 78 per cent … until 65 per cent, if we decide that 65 per cent (will be the Class C subsidy) for high income (earners). So that way, we don’t have big jumps.’

Speaking to some 500 grassroots members and leaders at a dialogue session in Ang Mo Kio yesterday, Mr Khaw tossed out the possible subsidy caps for the high-income in the different class wards. He said feedback received so far seems to suggest that the reasonable subsidy level for this group is around 65 per cent subsidy if they choose Class C, and 50 per cent for Class B2. These compare with 80 per cent for Class C and 65 per cent for Class B2 today, regardless of their income level.

The audience was largely concerned with the fairness of the means testing system. Mr Khaw stressed that the means-testing framework has to be based on a simple affordability assessment due to the acute nature of hospitalisation. This is why he chooses to use personal income as the assessment tool, rather than household income.

While he agrees with most that the means testing system currently used in nursing homes is ‘more correct’, the suggested assessment tool for hospitals is predictable, less cumbersome and less intrusive. ‘I’m going for simplicity. And because of simplicity, I need to err on the side of generosity. At nursing homes, we have plenty of time to evaluate, collect all kinds of audited information, then the thoroughness will remain.’

That generosity could be extended to retirees who are likely to be assessed on their housing type. He pointed out that they may have less funds in their Medisave because the scheme was only implemented in 1984. The government is mulling over retaining current subsidy levels for this group, except for the very well-off - say, those whose annual property value is at the top 20 per cent. They will have to be subjected to means testing.

Even with the implementation of means-testing, the government will continue to invest heavily in healthcare to cope with the ageing population and higher expectations of patients. Mr Khaw estimates that his ministry will be spending an average of $200 million a year over the next 10 years to expand capacity.

Source : Business Times - 14 Jan 2008

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Would it help if the Fed cuts interest rates before Jan 30?

Would it help if the Fed cuts interest rates before Jan 30?

By R SIVANITHY

SENIOR CORRESPONDENT

YOU’D have to wonder if the US Federal Reserve would bow to market - and undoubtedly political - pressures and cut interest rates before its Jan 30 Federal Open Markets Committee (FOMC) meeting.
With oil still close to US$100 a barrel and the US dollar still weak, the Fed might find it hard to justify such a hurried reduction. But with Wall Street crying out for relief (read: bailout), an emergency FOMC meeting before the next scheduled date cannot be ruled out.

Of course, whether or not lower interest rates would work is another issue - and so far it’s not clear that they would.

It’s very possible that a 50-point cut has already been discounted - something we discussed last week - because even though Fed chief Ben Bernanke on Thursday virtually confirmed that such a reduction would be made soon, the market collapsed on Friday.

Furthermore, rates have already been lowered by one full percentage point in three months to little effect, and it could be that we’re seeing a repeat of the 1990s savings and loan crisis when the Fed cut rates 23 times in the three years between 1989-1992 to little effect.

What does all of this mean for stocks? Probably that it’s not time to buy yet. Last week’s column raised the very real possibility that despite recent volatility, Wall Street stocks had still not fully factored in a looming US slowdown and, given the plunges suffered since then, it turns out we were right.

Coincidentally, that was the topic of a Morgan Stanley (MS) report released last Monday which asked: ‘Is the recession now in the price?’ The answer, as far as the US bond market was concerned, was yes, but, as far as stocks were concerned, the answer was no, with the US investment bank projecting downside of 10 per cent from the start-of-year prices.

Also coincidental was last Monday’s release of a Merrill Lynch report that a US recession isn’t looming, it’s already here. This was based on a dismal December employment report that showed the economy only added a shockingly low 18,000 jobs. Merrill Lynch was less optimistic than Morgan Stanley, estimating 15 per cent downside from start-of-the-year prices.

After Friday’s washout, the major US benchmarks are now down 5 per cent for the year to date. If both the US investment banks are right about the projected downside, then there could be further problems ahead, which investors here might wish to consider before indulging in any concerted buying.

If there is no FOMC meeting before Jan 30, the investors should watch out for a ‘buy in anticipation’ play leading up to Jan 30, which was also discussed in last week’s column. Since a 50-point cut has already been discounted, the logical consequence would be to ’sell on news’.

This might be averted if the Fed does convene an emergency meeting in the interim and/or is more forceful in its language and hints more strongly at greater easing in the months ahead. As it stands now, however, it would be prudent to brace oneself for continued weakness heading into February.

The upshot of all this is that until the dust settles on all the sub-prime issues, such as bank and credit card company losses, and, more worryingly, a US consumer spending slowdown, it probably isn’t time to buy yet - at least not in large quantities.

Those who do so would have to rely on luck, good timing and the ability/discipline to trade the bounces, qualities which only a small minority possess in abundance.

That the market is now populated almost exclusively by professionals that include day traders and hedge funds should be obvious from the fact that the top volume and gainers lists are filled with structured warrants every day, instruments still very much the preserve of professional traders, notwithstanding an increasing retail presence.

For the week ahead, these players will continue to track Hong Kong and the US futures market closely, the correlation between the Straits Times Index and these two markets being near-perfect over the past few months.
Source : Business Times - 14 Jan 2008

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MapletreeLog buys warehouse in S Korea

MapletreeLog buys warehouse in S Korea
MAPLETREE Logistics Trust (MapletreeLog) yesterday said it has agreed to acquire a warehouse in South Korea for 11.6 billion won (S$17.7 million), which will add 0.02 Singapore cents to its pro-forma distribution per unit.
The property is a two-storey warehouse/ distribution centre located in the established logistics cluster of Kyungki. It has a temperature-controlled section and a three-storey office building. Valued at 13.5 billion won, the property is located on freehold land, with a GFA of about 10,911 sq m.

The vendor of the property is Oakline Co, which will lease back the property for a period of four years. MapletreeLog intends to fund the acquisition wholly by debt, but does not rule out alternative means of funding as well.

‘We are very pleased with our first acquisition in South Korea as we continue to expand our footprint in Asia, diversifying our revenue streams across various countries,’ said Chua Tiow Chye, CEO of Mapletree Logistics Trust Management, which manages the trust. ‘This will be the sixth Asian market which MapletreeLog will have assets in.’ Mr Chua added that MapletreeLog will continue to grow its presence in the South Korean logistics real estate sector, seeing that it is a relatively well-developed market.
Source : Business Times - 14 Jan 2008

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US investors hold 16% of Singapore SGX market cap

US investors hold 16% of Singapore SGX market cap

S’pore equities the largest part of their Asian portfolios
By CHUANG PECK MING

(SINGAPORE) Measured by its share of local market capitalisation, American investors’ holdings of Singapore equities are the largest in their Asian portfolios.

They piled up US$43.91 billion worth of Singapore shares in December 2006, equivalent to 16 per cent of the market capitalisation of companies listed on the Singapore Exchange, says a new study by the United States Treasury and the Federal Reserve Bank of New York.

Only their South Korean equity holdings - which amounted to 14 per cent of the total domestic market value of listed Korean companies - in their Asian portfolios came close to that.

US accumulations of Japanese and Taiwanese equities were equivalent to 11 per cent of their respective domestic market capitalisations. Their holdings of Chinese equities were the smallest, in terms of the share of domestic market value.

According to the study, foreign investors have been accumulating long-term US securities - both debt and equity instruments - faster than US investors in adding foreign securities to their portfolios from 1994 to 2006.

But between 2004 and 2006, the US holdings of foreign stock grew as fast as foreign holdings of US securities - thanks to larger holdings of equities and bigger gains in these equities in the US investment portfolios.

‘In dollar terms, US holdings of foreign equities increased in value over this period (2004-06) by far more than did the value of foreign holdings of US equities,’ says the study. ‘Although foreign investors’ total holdings of US securities exceed US investors’ total holdings of foreign securities, US residents’ cross-border portfolios are dominated by holdings of equities (77 per cent) whereas only 34 per cent of foreign residents’ holdings consist of equities.’

The fall in the US dollar also inflated the dollar value of US holdings of equity abroad.

Overall, US investors hold about 12 per cent of total foreign equity markets, ranging from a low 3 per cent for China and a high of 22 per cent for Switzerland, according to the study. By comparison, foreign investors hold just over 10 per cent of total US equities outstanding.

US holdings of Singapore equities is thus way above its overall average for foreign equities.

US investments in Singapore shares shot up from US$6.83 billion in March 1994 to US$43.91 billion in December 2006, according to the study. But the sharpest rise came only in 2006, when US holdings jumped 50.9 per cent - against 30 per cent for US holdings of all foreign equities, and 23.7 per cent of all Asian equities - from US$29.11 billion in December 2005.

While US holdings of Singapore equities were small compared to most of the advanced Asian and European economies in absolute dollar terms, they carry more weight in the Singapore market. Thus, a shift in US investment decisions will have a bigger impact on the Singapore stock market than it would have on most other foreign bourses.

According to the study, Europe, led by the United Kingdom, continued to draw the lion’s share - 52 per cent - of US portfolio investments, followed by Asia.

As at December 2006, US investors held US$2.19 trillion in European equities in their portfolios, or about 13 per cent of European market capitalisation. Their Asian equity holdings were worth US$1.05 trillion, or 8 per cent of Asian market value.
Source : Business Times - 14 Jan 2008

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Investors brace for another harrowing week - Wall Street

Investors brace for another harrowing week - Wall Street

Earnings, economic reports ahead add to worries over US economy’s health
By ANDREW MARKS
NEW YORK CORRESPONDENT

IT was another dizzying and harrowing week for US stocks, and with Wall Street’s perception of the economy’s health turning sour, investors should brace for more of the same in the coming week, ahead of a wave of rough earnings and economic reports.

The market is still reconciling the fact that the economy is slowing and might be in a recession. Valuations may be too high compared to the low earnings.
‘It’s hardly a surprise that the stock market keeps slipping back into selling,’ said Jim Herrick, head of equity trading at RW Baird. ‘It’s very hard to gain any kind of buying traction when you get another piece of data pointing to a recession or more financial troubles for the banks every couple of days,’ he said.

Indeed, while stocks seemed on the brink of putting together a rally in the middle of the week, advancing on Wednesday and Thursday, those two days were sandwiched between big losses on Tuesday amid fears of bankruptcy at mortgage lender Countrywide Financial, and again on Friday, despite Bank of America’s announced takeover of Countrywide.

Since the start of January, economists have on average raised their likelihood of a recession occurring from just below 40 per cent to 50 per cent as of the end of the week. Goldman Sach’s Jan Hatzius was the latest and most noteworthy economist to throw his hat into the recession ring, with a report that estimated a better than 60 per cent chance of an economic downturn of about one per cent a quarter, lasting about six months.

‘The market is still reconciling the fact that the economy is slowing and might be in a recession,’ said Paul Nolte, director of investments with Hinsdale Associates. ‘Valuations may be too high compared to the low earnings.’

Investors will have plenty of opportunity to begin judging just how out of whack valuations are on an earnings basis as the fourth quarter earnings season shifts into high gear this week. Last Friday, investors reacted with a big sell-off to a downbeat report from American Express which took a charge of US$440 million on missed payments and estimated lower profits throughout the year.

American Express’s 10 per cent decline helped drag the Dow Jones Industrials to a 246.79 points, or 1.92 per cent decline to 12,606.30. The S&P 500 did a little better with a dip of 19.31 points, or 1.36 per cent to 1,401.02, while the Nasdaq Composite did a little worse than blue chips, giving up 48.58 points, or 1.95 per cent, at 2,439.94.

The major averages each finished the week with heavy losses. The Dow shed 1.5 per cent, and the S&P 500 ended down 0.7 per cent. The Nasdaq was the worst performer with a loss of 2.6 per cent. Over the first 10 trading days of 2008, the Dow is down 5 per cent, while the S&P 500 is off 4.2 per cent, and the tech-heavy Nasdaq has plunged by 8 per cent.

Investors will have more big-name companies’ earnings reports and forecasts this week, with fourth quarter results expected from major banks and bellwether technology firms.

Genentech kicks things off today, followed tomorrow by Citigroup, US Bancorp and Intel. Wednesday brings reports due from JP Morgan Chase and Wells Fargo, Thursday from Merrill Lynch, Washington Mutual and IBM. On Friday, it’s General Electric’s turn.

Thomas Lee, JP Morgan chief equities strategist, has a dour outlook on the fourth quarter profit season’s effect on the market. ‘The fourth quarter is unlikely to turn bears into bulls,’ he wrote in a research report, predicting a 10 per cent profit decline for the S&P 500 in the quarter, following a 5 per cent decline in the third quarter.

But investors will likely be paying as much attention to the week’s economic reports as the earnings reports, and that could prove to stocks’ advantage, as the Federal Reserve’s upcoming interest rate meeting looms larger.

The rising spectre of a recession has also raised the chances that the Fed will chop rates by 50 basis points at its Jan 30 meeting. Goldman also predicted that the Fed will cut the Fed Funds rate to 2.5 per cent this year to stimulate the economy.

Based on chairman Ben Bernanke’s comments last week, the Fed appears ready to knock rates down by half a per cent right away, but with oil prices in the US$90’s and other commodities soaring, strong inflation numbers could make it hard for the Fed to be very aggressive, said Lehman Brothers’ economist Ethan Harris.

Reports to be released this week include December producer prices and retail sales on Tuesday, the consumer price index, industrial production data, a housing market index, and the Fed’s Beige Book on Wednesday. On Thursday, housing starts, weekly jobless claims and the Philadelphia Fed survey will be released. Friday will bring a key consumer sentiment survey along with leading economic indicators.

Source : Business Times - 14 Jan 2008

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Singapore Construction demand could set new record

Singapore Construction demand could set new record

Analysts estimate $24 billion worth of contracts were inked in 2007
By UMA SHANKARI
(SINGAPORE) Construction demand in 2007 exceeded official estimates and is likely to have hit $24 billion, analysts said.

Key to GDP growth: Singapore’s booming construction sector has once again emerged as a major growth driver, after being in the doldrums for about eight years following the Asian Financial Crisis of 1997/98.
At present, the official forecast for last year’s construction demand is $19-$22 billion. But in just the first ten months of 2007, construction demand hit $18.5 billion. In addition, several major contracts were also awarded in the last two months of the year.

‘A ballpark estimate suggests that contracts awarded could have reached $23 billion for the whole of 2007,’ said Citigroup economist Kit Wei Zheng. CIMB-GK economist Song Seng Wun is slightly more bullish - he expects construction demand for last year to come in at $24 billion.

Singapore’s construction sector has once again emerged as a major growth driver, after being in the doldrums for about eight years following the Asian Financial Crisis of 1997/98.

Last August, industry regulator Building and Construction Authority upped its construction demand forecast for 2007 from its earlier estimate of $17-$19 billion.

There is also a sense that this year, construction demand will exceed the previous peak of $24.4 billion seen in 1997.

‘The construction sector is expected to remain a key driver to GDP growth in 2008,’ said Kim Eng’s research team. ‘The combined construction budget of the two Integrated Resorts amounts to over $12 billion and there is burgeoning demand from the residential property segment.’

Citigroup, for one, predicts that the pipeline of future contracts will likely remain large, supporting construction growth well into the second half of 2008 and 2009. ‘Given the synchronised supports from the integrated resorts, residential and commercial property boom and infrastructure projects, construction demand could well exceed the previous 1997 peak this year,’ said Citigroup’s Mr Kit.

Apart from the two IRs and infrastructure projects, the large pipeline of residential projects could yield between $12-15 billion of contracts awarded over the next two years, he said.

OCBC Investment Research analyst Serene Lim also pointed out that the government intends to raise the value added of Singapore’s energy industry to $34 billion in 2015 - an increase of about 70 per cent from current levels. The initiatives include probable plans to build an oil refinery with a capacity of 150,000 barrels per day, a liquefied natural gas terminal and biodiesel production plants, she said.

A recent report by construction cost consultancy Rider Levett Bucknall says that Singapore is on the upturn of the construction activity cycle, having recently emerged from a trough.

Analysts are also bullish on the prospects of construction firms in 2008.

‘The going will continue to be good for local builders as they enjoy strong order books and margins expansion,’ said Kim Eng Research.

Source : Business Times - 14 Jan 2008

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Singapore Industry players feel pinch of rising hotel rates

Singapore Industry players feel pinch of rising hotel rates

They are a concern for leisure travel sector; the going may get tougher for Mice operators also
By ARTHUR SIM

(SINGAPORE) The average daily hotel room rate for 2007 is expected to have hit a record $200. And although 2,000 new rooms will be added this year, there will be no let-up in rising rates.

‘Spending one night in Singapore is equivalent to spending two to three in Bangkok or Denpasar.’

- A tour operator

For 2008, consultancy firm HVS International tips a 15 per cent year-on-year rise in the average room rate (ARR) to $230, then a further 13 per cent rise to $260 in 2009.

But these increases are lower than that last year. According to the Singapore Tourism Board (STB), the ARR rose 23 per cent year on year between January and November 2007. For the month of November, it hit a record $226.

In comparison, the ARR for the same period in Hong Kong was $221.80. And the estimated ARR for Shanghai (which HVS notes was comprised of mostly high-end hotels), was $277.

Pressure on room rates will likely ease with new supply. For 2008, HVS reckons government land-sale sites could yield more than 4,600 rooms. But the actual number will depend on the take-up of such sites - and their cost.

HVS managing director David Ling said: ‘As demand for the economy and mid-tier segments is expected to surge, the land-sales programme for hotel projects should be tailored to locations that encourage developments of this type. Such sites are likely to be outside the prime area due to land costs.’

STB has been encouraging the industry to develop a range of options to add to the hotel mix to cater to different markets.

STB director (travel and hospitality business) Caroline Leong said: ‘In terms of hotel room rates, while we are seeing a record in Singapore, we are actually just keeping up with market rates in Asia. Also, prices are determined by demand.’

Industry players will be monitoring room rates closely.

Chan Brothers Travel executive (marketing, communications) Jane Chang said: ‘Rising rates are a concern for the leisure travel sector as it becomes increasingly difficult to source rooms at competitive prices.’

Chan Brothers also has a meetings, incentives, conference and exhibitions (Mice) arm, and on the upside, Ms Chang said: ‘Despite the increase in rates, bookings remain high as demand for corporate travel continues to grow.’

A tour operator who spoke on condition of anonymity bemoaned the skew towards the Mice sector. Many Singapore hotels now prefer to take corporate bookings, he said.

‘I believe top-notch hotels earn up to 60 per cent of their revenue from corporate travellers. Five years ago it was the reverse.’

Also in Singapore, accommodation can eat up as much as 26 per cent of a package-tour budget, the operator pointed out. ‘Spending one night in Singapore is equivalent to spending two to three in Bangkok or Denpasar.’

While he expects more hotel rooms and budget airlines to bring costs down, he said: ‘At the moment the number of packages we book has been decreasing and our margins are slimmer.’

Even for Mice operators, the going may get tougher.

Dilys Yong, immediate past-president of the Singapore Association of Convention and Exhibition Organisers and Suppliers, and president of Mice organiser HQ Link, said: ‘The quoted average room rate for 2007 is bearable for exhibitors and average trade visitors, but not budget trade visitors. However, the fact is that during the run-up to big events, room rates are even higher than the quoted average rate due to a shortage of rooms.’

As such, Ms Yong says that while the forecast 2008 average room rate is still ‘bearable’, actual rates will be higher.

Budget Mice visitors will find it virtually impossible to get a room, as Ms Yong reckons affordability in this segment is limited to $120 per night.

Inbound travel depends partly on the strength of the economy in the traveller’s home country, and SA Tours marketing and communications manager Ruth Lim noted: ‘There is an influx of leisure tourists to Singapore at this point as generally, these economies are rather robust.’

Until six months ago, SA Tours did not have an inbound leisure travel arm, but Ms Lim said: ‘Our inbound tourism clientele base has been steadily increasing.’

Source : Business Times - 14 Jan 2008

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Singapore Prices of CNY goodies to go up

Singapore Prices of CNY goodies to go up

Rising cost of fuel, raw materials to blame for 10-20% rise, say shops

By Lin Xinyi

BE PREPARED to spend 10 per cent to 20 per cent more on foodstuffs this Chinese New Year.
Suppliers, manufacturers and retailers have told The Straits Times that the costs of basic ingredients for festive goodies such as pineapple tarts, love letters and kueh bangkit have gone up.

Those in the trade cite the same reasons for the price hike: Increases in raw material costs and in operational costs from higher fuel prices.

They say that the increased costs come from the general upswing of prices last year, but the shortage of supplies and price increases now gripping Malaysia have not crossed the Causeway.

While some retailers say they will pass on some of the costs, others have chosen to absorb them to keep their regular customers.

However, the higher prices may not dampen demand in this market, estimated to be worth $10 million a year.

At Poh Guan Cake House, for example, business has been ‘comparable’ to last year despite the boxes of goodies costing $1 more each. Owner Chan Kim Ho said: ‘I am not worried that demand will be affected. In fact, we are swamped with orders.’

Glory Food Products managing director Andrew Chin said: ‘The prices have gone up for everything - oil, sugar, butter. And flour - that is the worst.’

Mr Png Geo Lian, chairman of the Association of Chinese Wheat Flour Merchants of Singapore, said flour prices jumped thrice last year. A 25kg bag which cost $20.40 in August now costs $30.90.

The 50 per cent increase is the result of a worldwide shortage of wheat caused by severe droughts and crop delays in Australia, the United States and Canada.

Mr Chin, saying that Glory products will cost 10 per cent more, said: ‘I have no choice but to cover my costs.’

Even Ban Hock Trading, which has kept prices on its line of goodies steady for 15 years, can no longer do so.

Accounts executive Melissa Lau said prices will be 10 per cent to 20 per cent higher.

‘The increases have been too tremendous. In 1994, cooking oil cost 28 cents per litre. It is $1.20 now,’ she said.

At Bengawan Solo, 80 per cent of the products will cost 6 per cent to 8 per cent more, said director of business development Henry Liew.

He said: ‘We feel we have to adjust our prices, but even so, it won’t cover our cost increases.’

Poh Guan Cake House’s Mr Chan said many customers were regulars, ’so I won’t want to raise prices too much’.

Both NTUC FairPrice and Cold Storage supermarkets have kept the prices of festive goodies sold under their house brands steady, but have raised those under other brands by between 10 per cent and 25 per cent.

Price increases have also hit Mandarin oranges and Chinese sausages.

Mr Tan Chin Hian, managing director of Ban Choon Marketing, a leading fruit importer here, said the oranges will cost about 10 per cent more as a result of higher freight charges and the appreciation of the Chinese yuan.

An 8kg carton of Mandarin oranges will cost $14, up $1.

Marketing manager Angela Goh of manufacturer Golden Bridge said a kilogram of Chinese sausages will cost $2 this year, 10 per cent more.

Among retailers who have chosen to absorb the price hikes is Upper Cross Street shop owner Choong Tzien Tao, who said: ‘Since it is not very drastic, I would maintain the same price rather than risk losing my customers.’
Source : Straits Times - 14 Jan 2008

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Singapore Toa Payoh Lorong 8 completes main upgrading programme

Singapore Toa Payoh Lorong 8 completes main upgrading programme

By Wong Siew Ying,
SINGAPORE: Residents at Toa Payoh Lorong 8 are enjoying a 38-million-dollar facelift of their estate.

A total of 1,532 households from 11 blocks now have a better living environment.

Besides new covered linkways and an amphitheatre, residents can now live amidst lush greenery. Other enhancements include playgrounds, pavilions and barbeque pits.

The lifts have also been upgraded with more security features and will now stop at every floor.

The precinct comprises 3-, 4- and 5-room flats and was built in the mid-1970s.

Residents paid between S$3,000 and S$6,000 to have their neighbourhood revamped. For one resident, the value of his flat has appreciated by 15 times since he bought it decades ago.

Dr Ng Eng Hen, Manpower Minister and MP for Bishan-Toa Payoh GRC, said: “They are telling me that the value of the flat has gone up and they are very happy with it. They feel that everyone can benefit from the common facilities, so that’s quite useful.”
- CNA/so

Source : Channel NewsAsia  - 14 Jan 2008

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Singapore Bayshore Park residents fail to form en bloc sales committee

Singapore Bayshore Park residents fail to form en bloc sales committee

By Ansley Ng,

SINGAPORE: Yet another attempt to put Bayshore Park on the en bloc market has been nipped by poor attendance, and residents who are not interested in selling are fed up with the repeated efforts.

They now want to consult Law Minister Prof S Jayakumar — who is also their Member of Parliament (MP) — during a Meet-The-People session.

The meeting on Saturday to form an en bloc sales committee for the East Coast condominium could not proceed as a quorum of 30 per cent was not fulfilled.

This is the second time an attempt to start an en bloc movement in the 1,100 unit Bayshore Park has been thwarted.

Last September, a group called for a meeting to form a committee to sell the estate but had to disband after objection from other residents on legal grounds.

A group of opposing residents had sent a lawyer’s letter to the old committee challenging its constitution and its validity under the amended Land Titles (Strata) Act, tweaked in September last year to improve transparency and balance competing interests.

At least 30 per cent of the 21-year-old estate’s sole proprietors have to be present in order for the extraordinary general meeting (EOGM) to go ahead for any en bloc push to proceed.

Bayshore Park is one of the most prominent properties along the East Coast and developments at the 21-year-old condominium — which is more than 1 million sq ft in size — is keenly watched by marketing agents and developers alike because of its prime seafront location and vast land area.

Saturday’s poor turnout was due to an inconvenient location, said a resident who is a member of the group leading the en bloc charge. Because of space constraints, the meeting was held at Bedok Community Centre instead of inside the estate.

More than 20 per cent of sole proprietors had turned up and some did not make it in time for the 2pm deadline, said the resident, who declined to be named.

Despite the setback, he told Today another meeting would be called within four to six weeks.

Residents against selling their homes were happy that another attempt at en bloc has failed but are concerned that there is nothing to stop another bid to call for an en bloc EOGM.

One resident, who declined to be named, said: “It is clear that the level of interest only belongs to one group of hardcore people who want to sell. But under current laws, it appears that there is no end to it.”

Every time an extraordinary general meeting is called, the estate ends up forking up to $10,000 in postage and logistic charges to host the meeting, he said.

The resident added that those against selling the estate want clarification on how many en bloc EOGMs can be called within a short period of time.

Mr Donald Han, managing director of property consultancy Cushman and Wakefield, said that if pro-en bloc groups repeatedly try despite failures, they will have to work harder on the ground to get more support each time.

“There is nothing to stop them from setting up the general meeting. But if they keep doing it, people might get tired and they might get less support,” said Mr Han. - TODAY/fa

Source : Channel NewsAsia  - 14 Jan 2008

Singapore Property - Buy , Sell , Rent , Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

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