In establishing China Investment
Corporation {CIC} - which is an equivalent to Singapore Government
owned investment company - Temasek Holdings, has China learnt the
horribly expensive lessons that Temasek has paid in buying into the
sovereign assets of other countries ?
CIC says it won't invest in sensitive
industries
Investment - 9 November 2007
China Investment Corp (CIC) will not buy into foreign oil, airline
or telephone companies, AP reported. Vice finance minister Li Yong
made the remarks yesterday at a conference in Beijing. A third of
CIC's funds will be invested abroad, and another third will be used
to buy Central Huijin, which controls state-owned banks. The rest
of the funds would be spent on Agricultural Bank of China and China
Development Bank. The bank acquisitions are likely to be profitable
for CIC. These are the first public comments by Beijing on the
investment strategy of CIC, China's US$200 billion sovereign wealth
fund. However, Li's remarks were not confirmed by either the
Finance Ministry or CIC.
Was Temasek's overseas investments - to own sensitive
telecomunnication entities that possess satelite assets - a
strategic move based on commercial principles, without any
political assessments or guidance from the political leadership
from the Government that owns Temasek ?
There were so many warning signs after receiving negative responses
even from countries that practise supposed ''open'' economies - especially when
there were howls of negative nationalistic reactions to Temasek's
offers to takeover telcos from Australia to Europe, as well as
strategic defense related industries in the USA.
Can the Singapore Government divorce its responsibilities
from Temasek's mistakes ?
We are currently seeing the fallout of Temasek's grab in sovereign
assets of Indonesia and Thailand, while at the same time its
gung-ho forays to outbid others to gain majority stakes in foreign
banks are causing dent that will amount to at least '30 to 50 percent' of the original
values paid.
With China picking up the lessons paid for by Temasek, will our own
self-acclaimed elites even bother to learn, or will they resort to
selling other assets, so as to fill up the big
hole in the accounts and show positive results ?
Similar detailed report of the news item can be seen in the
following site:
Taiwan News Online, with the same copyright
report being published in the Singapore Straits Times, Friday, 9
November 2007.
