Singapore PM: Let’s tackle cost fears together

Singapore PM: Let’s tackle cost fears together

Govt will play part, including in Budget; S’poreans must also make adjustments

By Li Xueying

PRIME MINISTER Lee Hsien Loong assured Singaporeans yesterday that their concerns about the rising cost of living, including food prices, have been heard - and are being addressed.
But Singaporeans themselves will, at the same time, have to make adjustments, he said. One suggestion: Go for cheaper house brands.

‘We can overcome this problem by working together. People making adjustments, the Government doing its part. We must stay together even during difficult periods,’ said Mr Lee.

Speaking to 1,400 residents and grassroots leaders at a Chinese New Year dinner at his Teck Ghee constituency, he, however, rejected calls for the Government to control the prices of essential goods.

‘Residents asked, ‘Why can’t the Government just control the prices?” he recounted.

His response: Singapore is an open economy and imports all its food.

‘We can’t just order wholesalers and retailers to fix or reduce prices. They have to pay the overseas suppliers - who will bear the loss?’

If the Government subsidises essentials, it will be ‘very expensive, and also ineffective’. As higher-income households spend more, such subsidies will benefit them more than the poor.

It is better to use the money instead to help the needy more directly, he said.

Thus, there are measures such as the Workfare Income Supplement Scheme as well as the Public Assistance Scheme, which is being reviewed.

At the same time, the Government is diversifying food sources, such as by importing frozen chicken from Brazil.

Consumers can also go for supermarket house brands, which are cheaper.

‘No need to buy branded bread,’ he said in Mandarin to laughter. ‘Bread is bread, rice is rice.’

Most important of all is to grow the economy so wages will go up, he stressed.

Noting that 2007 was a good year, with workers receiving significant pay rises and bonuses, he quipped that government revenues ‘have not been too bad either’.

Thus, Finance Minister Tharman Shanmugaratnam will distribute ‘a little hongbao’ in the Feb 15 Budget, especially for the needy.

‘But we must be realistic,’ he said. ‘I read the wish list for the Budget in the newspapers, all hoping that the Government will give out exciting goodies.

‘The Government will definitely help. But we cannot just distribute money and make the problem go away.

‘Even with a good harvest, or during Chinese New Year, the Minister for Finance is not the cai shen ye!’ he said, referring to the God of Fortune in Chinese mythology.

Inflation here hit a 25-year high in December, when the Consumer Price Index (CPI) jumped 4.4 per cent from a year ago. In particular, food prices were 5.5 per cent higher.

In a sign that the cost issue is high on the Government’s agenda, four Cabinet and junior ministers - besides Mr Lee - spoke separately on it at the weekend, assuring that the Government will help.

The subject took up the bulk of Mr Lee’s 20-minute speech, delivered both in English and Mandarin.

He started by noting that the Year of the Rat is beginning under ‘more challenging circumstances’ compared to previous years.

The financial markets are in turbulence, and the United States economy is slowing.

And the clouds will not be going away soon. In fact, Mr Lee warned that ‘we must expect more uncertainties ahead’.

He expects the CPI to be high this year, especially in the first half: ‘Last year, it was about 2 per cent. This year, it may be 5 per cent, it may even be more.’

Already, prices of Chinese New Year goodies such as pineapple tarts and bak kwa have increased, he noted.

But putting the grim outlook in perspective, he said that higher food prices is a global problem. Similarly afflicted are Malaysia, Indonesia and even Latin America.

On the whole, though, Singapore is in strong shape: ‘We expect the economy to keep growing, though slower than last year. Whatever it is, I am confident that we can weather the storm.’

Calling on Singaporeans to stay with the Government and to keep Singapore competitive and growing, Mr Lee concluded: ‘Then, whether it is the Year of the Rat or the Ox or Tiger, we will have the resources to deal with the challenges that come our way.’
Source : Straits Times  - 04 Feb 2008

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Singapore PM Lee says govt will help mitigate rising costs of food

Singapore PM Lee says govt will help mitigate rising costs of food
By Hasnita A Majid
SINGAPORE: Prime Minister Lee Hsien Loong has assured Singaporeans that the government will help mitigate the rising costs of food.

Speaking at the Teck Ghee Lunar New Year celebrations, Mr Lee said revenues have been strong and the government will be distributing help – especially to the poor and elderly – in the upcoming Budget debate.

But Singaporeans must also make necessary adjustments.

Mr Lee said: “I expect the inflation to be higher this year than last year, especially in the first half of this year. Last year, the inflation was about 2 percent. This year, it may be 5 percent, it may be even more.”

Singapore is not the only country experiencing rising food prices. Prices in China and India are also going up, due to affluence and more consumption demand.

Adverse weather conditions in Australia and China are also sending food prices upwards.

Some measures that the government will undertake to ease the situation are to diversify the country’s food sources and encourage consumers to switch to house brands, which are cheaper and give better value.

Lower income families can expect relief in the form of the government’s Workfare Scheme, which paid out S$150 million last month, benefiting some 290,000 workers.

The Public Assistance Scheme is also being reviewed.

Mr Lee said: “Most importantly, we need to grow the economy so that incomes will go up. Last year we had a good year, so wages, bonuses went up. And NTUC did a survey and found that last year, the bonuses which workers were getting were the highest bonuses in any year since 1990 - which means nearly in 20 years, we have not had such good bonuses.

“Lots of people are working, unemployment has come right down. We had 230,000 more jobs last year and unemployment has gone down to 1.6 percent.”

The prime minister added that being an open economy that imports all its food, Singapore cannot simply control the prices of food essentials as this will hurt the retailers and suppliers, resulting in shortages and queues.

And if the government subsidises these essentials, it will be costly and ineffective as the subsidies would also go to those who are not poor.

Mr Lee said while the government will help, Singaporeans must also do their part to work together to keep the country strong and competitive.

Source : Channel NewsAsia  - 04 Feb 2008

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S’pore GIC to buy Westin Hotel Tokyo for US$723m

S’pore GIC to buy Westin Hotel Tokyo for US$723m
TOKYO: The Government of Singapore Investment Corp (GIC) has agreed to buy the Westin Tokyo luxury hotel for 77 billion yen (723 million US dollars) from Morgan Stanley, a newspaper said Sunday.

The parties have reached a basic accord on the purchase of the land and the building located in Tokyo’s high-end residential and commercial district of Ebisu, the Nikkei business daily said.

They plan to complete the deal by late February, the newspaper said.

GIC will likely have the hotel continue its current operations and aim to increase the asset’s value by making it a long-term investment.

The purchase indicated that Japan’s real estate market is relatively attractive though other ones around the world are suffering from the US mortgage crisis, Nikkei said.

GIC is one of the world’s largest sovereign wealth funds, with more than 200 billion US dollars in assets under management, the report said.

In December and January, GIC made large investments in UBS AG of Switzerland and Citigroup Inc of the United States. Last year, it acquired Hawks Town, a commercial complex in Fukuoka Prefecture, western Japan.

Morgan Stanley purchased the Westin Tokyo for about 50 billion yen from Japanese brewer Sapporo Holdings Ltd in 2004. - AFP/ac

Source : Channel NewsAsia  - 04 Feb 2008

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