Govt may dip into reserves, says SM

Govt may dip into reserves, says SM

Move may be necessary to fund aggressive relief measures in downturn

By Jeremy Au Yong, Political Correspondent

ONE of the country’s sacred cows could be slaughtered during the Budget this Thursday as the Government mulls over a move to dip into Singapore’s rainy-day savings: the national reserves.
The leaders are now considering the unprecedented step of drawing from the reserves to fund the aggressive pain-relief measures needed in this downturn, Senior Minister Goh Chok Tong disclosed yesterday.

‘The issue which the Prime Minister and the Minister of Finance are now thinking over, is whether we should go to the President and ask him for approval to use the reserves for extraordinary measures,’ he told reporters after giving out $100 hongbao and goodies to the poor in his Marine Parade constituency.

But he also cautioned: ‘It’s a difficult decision because once you do that, you may open the reserves for future demands, which may not justify the use of reserves.’

On Friday, Prime Minister Lee Hsien Loong had said the Budget will run into a deficit this year and if necessary the Government will dip into the reserves.

He told reporters: ‘The Government’s job is not to do everything which is asked for but to see which are the items which will be most effective and then how do I raise the money to fund all the things which I need to do, either from the Budget revenues this year or from the reserves.’

Last year, the Government had modified the rules to allow it to spend a larger chunk of investment returns from the reserves.

In 1999, in the aftermath of the Asian financial crisis, the Government had shied away from dipping into reserves, even in the face of a $5 billion Budget deficit. Mr Goh was the prime minister then.

Yesterday, however, he pointed out that a ‘muscular response’ in the upcoming Budget is needed as these are exceptional times - and the key issue is to save jobs.

‘There must be exceptional measures for exceptional times,’ he said.

He gave a sampling of the dire economic news coming in, noting the sharp dive in export figures last month. Singapore’s exports plunged 21 per cent in December, the biggest fall in almost seven years. At PSA, 30 per cent of the cranes are sitting idle.

‘The weather is so bad, and we’ve always said the reserves are for a rainy day. If this is not a rainy day, I don’t know what is a rainy day,’ he said.

Asked how much money the Government may take out of the reserves, he said the amount did not matter. What was important was that the measures justified the use of reserves.

The Government has a hefty war chest to turn to. The reserves include assets managed by the Government of Singapore Investment Corporation (GIC), as well as those owned by the Monetary Authority of Singapore (MAS) and Temasek Holdings.

As of September last year (08), the MAS’ foreign exchange reserves were valued at about $240 billion. GIC’s portfolio is valued at well over US$100 billion (S$148 billion). Temasek Holdings’ portfolio is worth $185 billion but its assets are not covered by the constitutional amendment on net investment returns.

MPs contacted gave mixed responses to unlocking the reserves.

Dr Muhammad Faishal Ibrahim (Marine Parade GRC) and Mr Liang Eng Hwa (Holland-Bukit Timah GRC) said they were in favour if the money was well spent. Mr Liang said using the money to build up the economy and workforce is akin to investing in a different asset.

Mrs Josephine Teo (Bishan-Toa Payoh GRC) however said she would rather wait first to see how bad the crisis gets.

‘The conservative part of me says we really do not know how long this crisis is going to last. Will we risk running out of ammunition when we most need it?’

Financial analysts contacted backed any move to open up the war chest. That, they said, would spur a more aggressive Budget.

Said Dr Chua Hak Bin, Citigroup’s head of Singapore equity research: ‘We were concerned that the Budget was not going to be aggressive enough because of the constraint of having a balanced Budget.’

Nanyang Technological University economist Tan Khee Giap said that factoring in expenditure at the beginning was better than introducing off-Budget measures later. ‘We should budget for the worst and hope for the best,’ he said.

Source : Straits Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Bigger drug firms may now target Asian funds

Bigger drug firms may now target Asian funds

Opportunity for R&D outsourcing as well as for Asian VCs to invest in them

By CHEN HUIFEN

THE credit crunch in the US and Europe could help Asian life science funds like Singapore’s Bio*One Capital attract larger drug development firms to the region, thereby accelerating the development of its own life sciences sector.

Mr Singh: Sees 5-10 per cent growth in Asian healthcare market in 2009
The prognosis comes from Frost & Sullivan associate director Simranjit Singh, who forecasts 5-10 per cent growth in the Asian healthcare market this year.

Speaking at a breakfast forum recently on the outlook for the healthcare industry, Mr Singh said the bigger biotech companies have traditionally not considered Asian venture capital or private equity because they wanted to tap the wider network and access to talent of larger funds in the West.

As a result, Asian funds have largely invested in mid-size drug companies. He said: ‘Going back four to five years, a lot of VCs in Asia focused on mid-size biotech companies. But now there is a chance to invest in larger companies, bring them here and create collaborative opportunities with local companies.’

The advantages of bringing bigger firms here are many. They tend to have more products in the pipeline, which means higher chances of success compared with smaller outfits with only one or two compounds under development. Bigger biotech firms would also be cashflow positive.

‘Many of them are looking at cutting costs,’ Mr Singh said. ‘R&D outsourcing might be done here, giving other local companies a revenue stream as well.’

Frost & Sullivan valued the Asian healthcare market around US$240 billion last year. Of this, 66.2 per cent came from the pharmaceuticals industry, followed by 21.2 per cent from the medical devices sector.

But Frost & Sullivan senior consultant Louis Payet noted that the healthcare industry is not immune to the weakening global economy. Discretionary spending has fallen amid the downturn, and this will affect businesses that deal in elective surgery, cosmetic treatment and health screening, he said.

On the other hand, the downturn has put pressure on big drug companies to find ways to cut costs. And one way could be to outsource R&D, clinical trials or manufacturing to Asia.

Mr Singh said pharmaceutical manufacturing seems to have been hit hard by the financial crisis with demand for finished products - especially high-value, branded drugs - having fallen. On the other hand, biologics plants will expand in the region as demand for vaccines grows.

Dr Payet said: ‘Healthcare indices, while declining, have still outperformed the broader market. This implies that investors still expect positive activity in the industry in this region.’

Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Smart money should wait for Wall Street to fully capitulate

Smart money should wait for Wall Street to fully capitulate

By R SIVANITHY
SENIOR CORRESPONDENT

IT’S actually quite funny when you really think about it - the US’s printing of money to bail out a sinking ship that was inflated by the printing of money that led to a massive debt and property bubble in the first place.

Of course, with millions of jobs on the line, few people would see the humour in the US’s present plight. But neutrals who have observed the goings-on of the past 15 months would surely appreciate the irony of the present, constant plugging of holes in the US with ever-larger cash injections that so far, have seemed to wield little effect.

Optimists - and these ranks would be heavily populated by brokers and investment bankers - might believe that with so much money being flung at the problem (latest estimates are that the US rescue bill is closing in on US$1 trillion) things must improve, maybe even as early as the second half of 2009. If so, then now is the time to buy.

Pessimists would counter that when a bubble economy collapses, it usually enters a long period of stagnation and possibly depression. (We are reminded here of Ronald Reagan’s famous declaration that ‘a recession is when your neighbour loses his job; a depression is when you lose your job’.)

A case in point is Japan, whose property bubble burst in 1990, leading to a stockmarket crash. Its government eventually cut interest rates to zero (as has the US Federal Reserve now) and expanded its budget deficit sharply (as the US government already has). These actions did manage to avoid an economic collapse but there has been no recovery - Japan has had five recessions in 18 years and the latest looks like the worst. After repeated failed bear rallies, its stock market is still more than 70 per cent down from its all-time high.

A neutral, in the meantime, might say the jury is still out on whether simple money printing and expansion of the budget deficit will work, because a heavily indebted consumer who has no job cannot help to drive the economy out of its mess by spending. As such, scepticism should be the order of the day - until clear signs to the contrary emerge.

Optimists might argue that with so much volatility, it’s best that investors shorten their horizons and if so, the impending inauguration of President Barack Obama in the US on Tuesday, the Singapore government’s impending Budget announcement on Thursday, and Chinese New Year soon after might mean now is a good time to buy because there could be a ‘Chinese New Year rally’.

Pessimists would say that any such rally would be largely through short-covering and would be temporary at best, and that if one does occur, investors should continue to sell into strength since by the government’s own admission, conditions have actually worsened since the start of the year.

A neutral would reply that cash is king and nobody knows where the bottom is. But they would note that all urgings to buy have come from brokers and investment bankers who were painfully wrong last year and should therefore be afforded minimal credibility in the investment advice stakes.

Optimists would reply that 15 months into the bear market may be sufficiently long for the market to fully discount all the bad news, so present prices probably already reflect the worst.

Pessimists would point out that prices are only being kept afloat by the US government’s bailout money and that if these efforts fail, the downside can be massive. US stocks are only at their lowest in 10 years, which does not gel with an economy mired in the worst depression in 70 years.

A neutral would observe that the market has demonstrated huge inefficiencies over the past few years, failing to recognise risks when they were staring everyone in the face and instead believing the now-discredited mantra that ‘this time is different’.

As a result, the smart thing to do is stay away from stocks until the ranks of optimists thin significantly, the ranks of pessimists swell appreciably, and above all, much clearer signs of capitulation appear - especially in the US, because it can only be a matter of time before this occurs.

Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Businesses hopeful that Budget will help cut operational costs

Businesses hopeful that Budget will help cut operational costs

They are looking forward to a range of tax cuts

By CHEN HUIFEN

(SINGAPORE) Expectations are high among business owners that the forthcoming Budget will contain new measures to help reduce operational costs, stimulate demand and address the liquidity situation.

Help needed: Suggestions to give businesses a boost include cuts in ERP charges for commercial vehicles and in the foreign worker levy
So far, off-Budget measures such as a $2.3 billion business financing package introduced by the government late last year have eased the credit crunch slightly. But businesses are hoping for more.

‘The chamber received feedback from members of larger enterprises that they are not able to benefit much,’ said the Singapore Chinese Chamber of Commerce and Industry. ‘For instance, the loan quantum for bridging loan is insufficient to sustain their operation requirement, which requires fund injection in the range of millions. Others, such as those in the bunkering business, for instance, are not eligible for the loan insurance scheme.’

Lawrence Leow, president of the Association of Small and Medium Enterprises (Asme), said members would like to see the government raising its default risk undertaking for micro loans to 90 per cent, from 80 per cent currently. They also hope the loan quantum for a bridging loan can be raised to $3 million to $5 million, from $500,000.

Aside from tweaking existing schemes, businesses are also keeping their fingers crossed that the government will cut the corporate tax, currently at 18 per cent, by another one to two percentage points.

Since the government has ruled out a GST cut, other ideas have surfaced - food vouchers, cutting miscellaneous taxes like road, TV licence and income taxes, and even a tax holiday this year.

Other moves that could help reduce operational costs include cuts in the foreign worker levy, property taxes, stamp duties, ERP charges for commercial vehicles, as well as rental rebates for government-owned space.

Against a backdrop of weak external demand, the domestic economy has become key. So these cost-cutting measures need to be coupled with private spending stimulants to avoid a deflationary spiral.

Since the government has ruled out a GST cut, other ideas have surfaced - food vouchers, cutting miscellaneous taxes like road, TV licence and income taxes, and even a tax holiday this year, in the hope that consumers will spend the extra cash.

‘During the initial period, it (the extra cash) may go into savings banks,’ explained Singapore Indian Chamber of Commerce and Industry executive director Predeep Menon. ‘But as confidence is restored, the expense will start to happen.’

Small and medium-sized companies are also hoping that more deferred public infrastructure projects will be brought forward, said Asme’s Mr Leow.

‘Perhaps the government could (also) help by enhancing access to non- traditional markets whether through partnerships with local companies or through providing incentives,’ he added. ‘Access to new markets is a long-term solution to build a sustainable business.’

The incentive could come in the form of cost reimbursement for international business travel, and simpler profit repatriation rules, said Phillip Overmyer, chief executive of the Singapore International Chamber of Commerce.

With major developed economies harder hit by the global financial crisis, it may be apt to encourage companies to suss out opportunities in emerging markets.

China, India and Vietnam, for instance, are building up their domestic economies, which will have very different supply requirements from the past when the focus was on selling to the Western markets.

‘So we want our businesses in those markets to understand how to meet and serve these new domestic market needs in these countries because they will be new markets for us,’ said Mr Overmyer.

All said, business owners are hoping for a wide range of measures to be introduced to help them keep their operations going and in so doing, save jobs.

Freddy Sim, chairman of Eternal Financial Advisory, puts it this way: ‘This economic crisis is really a chain effect so everybody will be badly affected. And if you don’t have enough business to sustain the overhead costs, the business will cease.’

With additional reporting by Zeinab Yusuf

Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Tax cuts, tax holiday a wild card; higher chance for rebates

Tax cuts, tax holiday a wild card; higher chance for rebates

Revised rules may unlock more funds for govt spending

By LYNETTE KHOO

(SINGAPORE) Cash is king and against the backdrop of such a mantra, one can expect the government to put more money in the hands of businesses and individuals at the upcoming Budget for fiscal 2009.

Some believe the government has more gun powder to cut taxes and dish out more generous rebates, or even offer a tax holiday, as a constitutional framework revised last October may unlock more reserves for government spending.

But tax cuts and a tax holiday remain a wild card for now going by the usually prudent and conservative fiscal stance of the government, market watchers say.

Standard Chartered economist Alvin Liew says he expects both the corporate and individual tax rates to stay untouched, while there could be one-off measures such as partial waiver of profit tax, property tax, personal income tax, and corporate tax.

‘It would be too hopeful to expect further cuts in personal and income taxes without a commensurate increase in other taxes to compensate for the lost revenue,’ he says.

‘Since the GST will not be revised this year, we should not expect income tax cuts that could lead to chronic fiscal imbalances in the future,’ he adds.

The last corporate tax cut was a two percentage-point reduction to 18 per cent in the FY2007 Budget for Year of Assessment (YA) 2008. The personal income tax was left untouched at 20 per cent.

Still, some economists say a reduction in direct tax revenue does look more manageable now given the funding from the two-percentage-point GST increase in 2007, and more funds from a new Net Investment Returns (NIR) framework.

The new framework allows the government to tap up to half of the total returns from investing the reserves to include capital gains, instead of using only the interest and dividend income earned from investing the reserves.

‘We think there is a good case for cuts in corporate and/or personal income tax,’ says Citi economist Kit Wei Zheng. ‘To further ease any potential strain on the fiscal position, the tax cuts could be staggered over two to three years, say one percentage point cut each year.’

Mr Kit adds that he does not rule out downside risk in the amount of funds to be tapped under the NIR framework, as it prices in changes in market value of investments. The government may also want to save some bullets for off-budget measures.

During the past downturns of 1998 financial crisis and 2001 tech recession, the government doled out off-budget packages totalling $12.5 billion and $13.5 billion respectively. Corporate and income tax cuts were made both in FY2001 and FY2002 but not in FY1997 or FY1998.

Some analysts have also tossed the idea of a ‘tax holiday’, which they believe will offer an immediate relief to businesses and households, and facilitate a shift to the ‘pay-as-you-earn’ tax system - tax liabilities based on this year’s income rather than a year ago income.

‘Despite its obvious merit however, it is uncertain if the government is keen to look at this proposal,’ CIMB-GK economist Song Seng Wun says. He estimates that a tax holiday may cost the government $19-20 billion and result in a record primary budget deficit of 8 per cent of GDP.

Hope for generous rebates in this upcoming Budget is less likely to disappoint, market watchers say.

Some reckon that tax rebates could have a greater impact on spending than tax cuts since most consumption is imported and tax savings are likely to be hoarded rather than spent. Any change to the longer term tax rates structure will also be difficult to reverse when economic conditions support a policy reversal, say Ernst & Young tax partners Ang Lea Lea and Pok Soy Yoong. ‘A tax rebate offers the advantage of releasing cash into the economy but leaves the present tax rates structure unchanged.’

KPMG’s head of tax services Owi Kek Hean recommends a one-off corporate tax rebate to be given to help businesses ride the current economic hardship. For individual taxpayers, he suggests a 10 per cent uncapped tax rebate and expanding the zero percent tax bracket of $20,000 to help those at the lowest income level.

Deloitte’s tax partner Ajit Prabhu suggests raising the partial corporate tax exemption from the first $300,000 chargeable income to the first $500,000 chargeable income to reduce the tax burden on the SMEs. He hopes the government will maintain the 20 per cent personal income tax rebate in this year’s Budget and raise the cap from $2,000 to $5,000.

Among its recommendations, PricewaterhouseCoopers (PwC) suggests a scheme to defer individual tax payment for active job seekers who are retrenched to alleviate their short-term financial woes.

The big four audit firms also ask that the government allow the carry back of tax losses beyond one year and remove the $100,000 ceiling for tax losses that can be carried back.

To encourage local firms to remit foreign-sourced income back to Singapore to finance their operations here, tax experts are calling for tax exemption on foreign-sourced income, or a tax amnesty that provides exemption within a certain time.

As the property sector enters a rough patch, market watchers are expecting some temporary measures such as tax rebates for the commercial and industrial segments.

Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Dipping into the reserves to tide over crisis?

Dipping into the reserves to tide over crisis?

Govt mulling over whether it should seek president’s approval to use country’s reserves: SM Goh

By CHUANG PECK MING

(SINGAPORE) For the very first time, the government may turn to the president for the green light to dip into the country’s closely-guarded reserves to tackle what is shaping up to be Singapore’s worst economic slump since 1929.

Prime Minister Lee Hsien Loong and Finance Minister Tharman Shanmugaratnam are currently mulling over whether to make the move, according to Senior Minister Goh Chok Tong.

‘It’s a difficult decision - because once you do that, you may open the reserves to future demands which may not justify the use of the reserves,’ he told reporters at his Marine Parade constituency yesterday. ‘So it’s an issue that the prime minister is thinking over very carefully.’

Mr Goh said these are exceptional times - and the reserves are intended for exceptional times.

‘We’ve always said, ‘the reserves are for a rainy day’. If this is not a rainy day, I don’t know what is a rainy day,’ he said. ‘Nevertheless, it has to be justified to the president. So that’s an issue which the finance minister and the prime minister will have to deliberate quite carefully.’

Asked how much should be drawn from the reserves, he said it depends on the measures that would justify the use of the reserves.

Noting that the latest trade data shows a plunge in Singapore’s trade, Mr Goh said things are going to be ‘very bad’ this year.

He pointed out that 30 per cent of the cranes at PSA are sitting idle, with shipping freight rates close to zero.

‘We must have a muscular response in the Budget,’ he said. ‘The key issue for us is how to save jobs. Of course, to have economic growth, you have to stimulate demand. But this time, it’s a global recession; it’s beyond us. We can do what we can in Singapore, but it’s not going to solve our economic problem.’

Mr Goh said the government’s focus would be on saving jobs. ‘We have to try to save costs wherever we can, train every trimmed worker, but primarily try and keep costs down, so that as many jobs as possible can be saved.’

To deal quickly with the economic problems, the government has brought forward the Budget by a month to this Thursday.

On the investigations into failed financial products, such as those linked to Lehman Brothers, Mr Goh said there are lessons learnt, and more measures would be put in place. But he declined to discuss the details yesterday.

‘I would not want to go into this because there’s a question asked in Parliament,’ he said. ‘That question will be answered, plus your question.’

Parliament meets today.

Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Obama stimulus plan holds potential for Singapore firms

Obama stimulus plan holds potential for Singapore firms

IE S’pore urges firms to look abroad as govts up spending
By CHUANG PECK MING

(SINGAPORE) Incoming United States President Barack Obama will be seeking to spend US$1 trillion to kick-start the US economy. International Enterprise Singapore wants a cut of the spending for Singapore companies.
Chong Lit Cheong, IE Singapore’s chief executive, told reporters last Friday that its offices in the US will be watching the new administration closely to flesh out more details of President Obama’s stimulus package before his agency can spell out how and in what areas Singapore companies can benefit.

But he reckoned that a big chunk of the money in the package will be earmarked for building new infrastructure and shoring up existing ones - an area where Singapore companies have built a nice track record.

Markets virtually everywhere are in a slump - and global demand still has more room to fall. ‘However, with governments worldwide boosting domestic demand spending to stimulate growth, this is an opportune time for Singapore companies to capitalise on opportunities abroad,’ IE Singapore said in a press statement embargoed for release today.

Mr Chong said IE Singapore, the government’s trade promotion arm which also doubles as the agency pushing Singapore companies to venture abroad, will be stepping up its efforts and provide more resources to help local companies go international and win projects.

 
 
So expect Finance Minister Tharman Shanmugaratnam to allocate more money in the Budget to help Singapore businesses expand overseas.

IE Singapore spent $769 million last year to assist 41,000 companies here to generate more than $11 billion in projected sales overseas. Among those the agency helped: Amtek Engineering, which started a manufacturing plant in Hanoi, Vietnam, and expects to rake in overseas sales of $20 million; Frasers Centrepoint, which secured a residential project in Suzhou Industrial Park in China; and Taihua Food Industries, which clinched a deal to contract pack sauces for Sam’s Club, a Mexican company.

The number of companies on IE Singapore’s ‘help’ list has grown by 68 per cent since 2006, while the value of support given to them rose 33 per cent.

IE Singapore said its assistance for companies in the coming months ‘will be tailored towards helping them overcome challenges, including market access and capability development’.

‘IE Singapore’s existing programmes continue to be taken up by Singapore firms, indicating continued interest to venture abroad,’ the agency said. It stressed that small and mid-sized enterprises would continue to benefit from IE Singapore’s ‘range of broad-based services’.

‘In fact, these programmes are becoming even more relevant in times like these,’ it added.

IE Singapore will concentrate mainly on China, India, the Middle East. Vietnam, Latin America and Africa. It will also target international organisations, which are expected to offer some $150 billion worth of business projects yearly.

‘Over the last three years, Singapore has secured less than 0.1 per cent of the pie,’ IE Singapore said. ‘These internationally financed projects constitute a potential new growth area of business opportunities for Singapore-based companies.’

IE Singapore and the European Bank for Reconstruction and Development (EBRD) recently set up a technical cooperation fund worth $636,000.

‘The fund will create mindshare within the EBRD’s 30 countries of operation of Singapore’s competencies and development experience in urban transport and related urban solutions,’ IE Singapore said. ‘It will facilitate Singapore players to diversify into Central Asia and Eastern Europe.’
 
 
Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com

Washington gears up for Obama - WASHINGTON

Washington gears up for Obama - WASHINGTON

(WASHINGTON) Excitement is swelling across the United States and the world as Barack Obama prepares to be sworn in tomorrow as the nation’s first black president, witnessed by the largest inauguration crowd in history.
Mr Obama is ‘a man whose history reflects the enduring promise of our land’, outgoing President George W Bush said on Thursday as he bade farewell to the nation in a televised address.

Washington is proudly gearing up to host the inauguration of the 44th president, which draws the curtain on Mr Bush’s controversial eight-year reign.

But with some two million people expected to attend the event along with a veritable ‘who’s who’ of Hollywood stars, sporting heroes and political heavyweights, the tightest security operation ever mounted in the nation’s capital swung into action at the weekend.

Nothing on this scale has been seen since the 1965 inauguration of John F Kennedy’s successor Lyndon Johnson, attended by 1.2 million people. And anxious security officials have been poring over plans for months. More than 12,500 active troops and military reservists, and thousands of police are being drafted in as a security blanket descends on the city.

 
 
Some nine square kilometres - a huge swathe of the downtown area encompassing the White House, the National Mall and the Washington Monument - is being locked down from this afternoon until just after dawn on Wednesday, with traffic restrictions in place already from Saturday.

Despite the fervour to be among those witnessing history, officials and even Mr Obama’s transition team are warning would-be spectators to think seriously about attending, with the young, old and infirm urged to stay away.

Mr Obama has encouraged people to take part via the Internet, or by watching television, or by joining one of several events leading up to the inauguration which kicked off Saturday with his train ride from Pennsylvania to Washington.

Yesterday, tens of thousands were due to surround the Lincoln memorial for a free concert with such stars as Bruce Springsteen, Bono, Beyonce and Mary J Blige, with the incoming president to take a starring role.

But the spotlight will be tomorrow when Mr Obama and Vice-President Joe Biden will take the oath of office towards midday on the steps of Capitol Hill.

Mr Obama will swear on the Bible which once belonged to his hero, assassinated president Abraham Lincoln.

There will be a song from Queen of Soul, Aretha Franklin, as well as performances by Yo-Yo Ma, after the incantation to be given by controversial pastor Rick Warren.

Ten huge video screens and 100 loud speakers are being erected for the crowds. Afterwards, Mr Bush will depart for his ranch in Texas, and Mr Obama will host a luncheon in the Capitol building.

Then a parade will march down Pennsylvania Avenue to the White House where Mr Obama and his family will take up residence.

The festivities will continue long into the night as Washington rocks around the clock with a flurry of inaugural balls.

Mr Obama is hosting 10 official balls, but some of the unofficial balls may well be the place to be seen. The first ball that Mr Obama and the new first lady will attend has been dubbed ‘The Neighbourhood Ball’, offering free tickets to residents in a break with past parties which have usually only catered to a powerful, wealthy elite. — AFP

Source : Business Times - 19 Jan 2009

Singapore Property - Buy, Sell, Rent, Invest

Mindy Yong

(+65)91002985

mindy@mindyyong.com